BEIJING — Overseas investment into China rebounded last year after declining in 2012, official data showed yesterday, as confidence in the country’s growth potential picks up. Investment by China also rose and officials said it could overtake the incoming total this year — although Chinese businesses shied away from the European Union and Japan as market and political tensions become strained.
Foreign direct investment (FDI) into China, which excludes financial sectors, totalled $117.59 billion last year, the commerce ministry said, adding it had “steadily rebounded”.
The figure is up 5.3 per cent from the $111.72 billion posted in 2012, when it skidded 3.7 per cent for the first time in three years in the face of economic weakness in developed markets and a growth slowdown at home.Louis Kuijs, Hong Kong-based economist with Royal Bank of Scotland, said some strength in the economy, “especially in the second half of 2013″, and Beijing’s plan to transform its growth model helped investor confidence.
“The intentions of the government to change China’s pattern of growth to increase the role of domestic demand perhaps stimulated foreign companies to invest more,” he said.
Chinese overseas investment rose 16.8 per cent to $90.17 billion last year, the ministry said, as mainland firms continue to buy foreign assets, particularly energy and resources, to power the world’s number two economy.
“China’s overseas investment will probably exceed FDI next year or in 2016, if not this year,” ministry spokesman Shen Danyang said.
Though destinations such as Russia and the United States saw sharp increases, investment in the European Union and Japan fell.
Investment in the EU fell 13.6 per cent at a time when the two sides are embroiled in trade disputes including on Chinese solar panels and European wine. There was also a 23.5 per cent slump in investment in Japan, as Asia’s two top economies remain engaged in a territorial row that has led to frostier relations.
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