Chinese Embassy in the UK refutes foreign media claims over FDI data
Published: Mar 12, 2024 02:32 AM
A view of Shanghai, China's major financial hub and destination for foreign investment Photo:VCG

A view of Shanghai, China's major financial hub and destination for foreign investment Photo:VCG

The Chinese Embassy in the UK on Monday slammed foreign media reports claiming that foreign direct investment (FDI) to China has fallen to a 30-year low, noting relevant reports are biased, misleading and unprofessional.

In a statement, a spokesperson for the embassy also highlighted record levels of FDI to China despite short-term fluctuations and China's increasingly prominent advantages in attracting foreign investment, while stressing China's door will open wider for foreign businesses.

Citing a recent indicator from China's State Administration of Foreign Exchange (SAFE), many foreign media outlets have hyped the claim that FDI to China has slumped to a 30-year low. The Financial Times, for example, said that the SAFE's direct investment liabilities figure is a gauge of foreign capital flowing into the country and, at about $33 billion in 2023, is the lowest since 1993.

"The UK media reported a one-sided interpretation of relevant Chinese statistics, seriously misleading readers, and exposing the relevant media's unprofessional and inaccurate reporting on China-related economic news," the spokesperson for the Chinese Embassy in the UK said in the statement.

The spokesperson noted that increases and declines in global FDI is normal, and fluctuations in global FDI has intensified in recent years due to the economic impact of the COVID-19 pandemic, the sudden shifts in monetary policies of developed economies, and the increasingly complex global political situation. The spokesperson singled out the US' high interests, which added to financing costs and declining investments among multinationals.

"China's FDI is basically in line with global trends. Interpretation of relevant data requires comprehensive consideration of its historical base and fluctuations. A decline in data in a certain year cannot simply lead to the conclusion that 'foreign capital has fled China,'" the spokesperson said.

In fact, foreign investment into China has remained on historical high levels. According to data from the Chinese Commerce Ministry, FDI to China in actual use stood at $163.3 billion in 2023, which is the third-highest on record, after the levels in 2021 and 2022. The number of newly established foreign-funded entities surged by 39.7 percent year-on-year to 53,766. Investments from France jumped 84.1 percent, from the UK 81 percent, and from the Netherlands 31.5 percent.

The spokesperson also noted that China's advantages in attracting foreign investment are becoming more prominent, including its economic recovery, improving business environment, solid industrial foundation, and a vast consumer market.

"Generally speaking, the fundamentals of China's long-term economic growth have not changed. China is accelerating the development of new quality productive forces. China's door is opening wider and wider. The quality of its high-level and institutional openness is getting higher and higher. China will definitely remain a hot spot for foreign investments," the spokesperson said.

Such a sentiment is also shared by many global multinational companies, including those from Europe and the US, which are stepping up investment in the Chinese market, despite foreign media slanders against the Chinese economy.

In interviews with more than half a dozen foreign companies and business groups, the Global Times found that many multinational companies operating in China have drawn great confidence in their prospects in the Chinese market from the two sessions, where top officials put a heavy emphasis on greater efforts to attract foreign investment. More than just growing optimism, many global businesses are actually increasing investments and expanding in the Chinese market.

Global Times