China foreign expenditure up

China invested more money abroad last year than foreign firms piled into the country, data showed yesterday, a first for the world’s second-largest economy.Overseas direct investment soared more than 18% to an all-time high above US$145 billion (N$2 trillion) last year, exceeding the US$135.6 billion of foreign direct investment.This “historic breakthrough” was a result of the “enhancement of China’s comprehensive national power”, deepening cooperation, and Beijing’s strategy of encouraging Chinese firms to “go abroad” in search of growth, the government said.Chinese firms “have to make use of international resources and markets to transform and upgrade”, the commerce ministry’s representative Zhang Xiangchen told reporters at a news conference.“We feel companies currently are keen to go abroad and actively integrate into global innovation, manufacturing and market networks.”The data was revealed in the 2015 Statistical Bulletin of China’s Outward Foreign Direct Investment.China’s economy grew at its slowest pace in a quarter of a century last year, and continues to decelerate as the country faces multiple development bottlenecks.Among these are manufacturing overcapacity, insufficient domestic demand and increasing energy and resources consumption.To enhance their competitiveness, cash-flush Chinese firms have sought to acquire foreign brands, technologies and resources.Last year Chinese firms conducted US$54.4 billion of mergers and acquisitions, including the takeover of Italian tyremaker Pirelli by state-owned ChemChina. And 2016 has seen an even greater flurry of activity.In the first eight months of this year, M&A surged to US$61.7 billion, the ministry said, as Chinese companies scored massive investments, from Hollywood studio Legendary to leading German robotics firm Kuka and Swiss seed giant Syngenta.“We think Chinese companies’ overseas takeovers can help them acquire high-end production elements such as design, research and development, marketing and service to upgrade their positions in the global value, industrial, logistics chains,” said Zhang, adding that they can also contribute to the economies of host countries.But problems remain for these firms as they pursue overseas expansion, he said.“Some companies went with overseas takeovers blindly. We found some firms did not make sufficient research into basics such as the purpose and necessity of overseas M&As. Some... rushed to expand while some were driven by irrational reasons to simply follow the craze or show off.”But while China goes on a buying spree, foreign partners in the US and EU have complained of a lack of reciprocal access to Chinese industries, with many sectors off-limits or restricted to outside investment. Among them are telecommunications, media, energy, and legal and financial services.China’s stock of investment in the European Union totalled US$64.5 billion in 2015 and US$40.1 billion in the US, data showed.In an appearance in New York this week China’s premier Li Keqiang said “China’s door, once open, is unlikely to be closed”, the state-run China Daily reported. He added that there are “tremendous investment opportunities” between the US and China and assuring business leaders.

China foreign expenditure up

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Namibian Sun 2025-07-01

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China foreign expenditure up

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Namibian Sun 2025-07-01

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