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China’s Q1 Foreign Direct Investment Showed a 4.6 Percent Annual Increase

On March 25, China’s Ministry of Commerce announced that foreign direct investment data for the first quarter of 2021 was 206.14 billion yuan (US$31.79 billion), a year over year increase of 4.6 percent. The data showed that foreign non-financial direct investment was 160.81 billion yuan (US$24.76 billion), a year-over-year decrease of 4.9 percent. The amount for the completion of contracted projects was 195.31 billion yuan (US$30.07 billion), roughly the same as the same period last year. The newly signed contract value was 347.24 billion yuan (US$534.62 billion), a year-over-year decrease of 10.2 percent. In addition, 74,000 individuals from different labor forces were dispatched overseas. At the end of March 590,000 personnel were working abroad.

Below are four major highlights:

1) “Belt and Road” countries showed a steady growth in investments. In the first quarter, China’s non-financial direct investment in these countries was US$4.42 billion, an increase of 5.2 percent year over year. The value of newly signed contracted projects was US$31.34 billion, and the completed contract value was US$17.75 billion, an increase of 19.4 percent and 12.4 percent year-over-year respectively.

2) The investments in manufacturing, information transmission and other fields showed a rapid growth. In the first quarter, investment in manufacturing was US$3.84 billion, a year over year increase of 17.8 percent; the investment in the information transmission industry was US$1.62 billion, a year over year increase of 20.9 percent.

3) Foreign investments from local enterprises have increased. In the first quarter, foreign non-financial direct investment by local enterprises was US$20.03 billion, a year over year increase of 9.9 percent, accounting for 80.8 percent of the total foreign direct investment in the same period. The year over year growth of foreign investment from the eastern, central and western regions reached 7.2 percent, 45.6 percent and 6.3 percent respectively.

4) Foreign contracted projects are mostly in infrastructure. In the first quarter, the value of newly signed contracts for overseas infrastructure projects was US$41.2 billion, and for the completed contracts, it was US$24.6 billion, accounting for 77 percent and 81.6 percent of the total respectively.

Source: Sina, April 25, 2021