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China's ODI growth to continue: US Congress report

2011-03-31 11:19

WASHINGTON - The trend of China's growing investment in foreign countries is expected to continue, said a US Congressional research panel in a report released Wednesday.

"Chinas investments abroad are growing despite an overall decline globally in foreign direct investment (FDI) following the 2008 financial crisis," said the US-China Economic and Security Review Commission (USCC) in its report -- Going out: An overview of China's outward foreign direct investment (ODI).

"That trend in Chinese investments abroad is likely to continue, since China's huge foreign exchange reserves are an increasing source of mobile capital and is a key part of China's official government policy," writes the report.

The report noted that growth in China's ODI flows has become very significant in recent years, going from less than $100 million in flows in the 1980s to $56.53 billion in 2009, making China the fifth largest originator of ODI.

Despite the impressive growth trends, however, Chinese ODI remains relatively small: China, including Hong Kong and Macao, accounts for just 6 percent of global ODI stock currently, said the USCC, which was created by the Congress in 2000 to focus on US-china bilateral trade and economic relationship.

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