FDI in nation optimized, upgraded

BEIJING — For some time, some have fixated on the isolated statistic of a decline in foreign direct investment to undermine confidence in the Chinese economy. The reality is that FDI in China is being optimized and upgraded.

It's misleading not to consider these figures within a global context, as a decline in FDI is not unique to any single country.

According to the United Nations Conference on Trade and Development's Global Investment Trends Monitor, excluding higher values in a few European conduit economies, global FDI flows had dropped by 18 percent in 2023, affected by economic uncertainty and rising interest rates. India's FDI inflows fell by 47 percent, the Association of Southeast Asian Nations saw a 16 percent decline and the United States experienced a 3 percent drop.

From January to July, China's actual use of FDI exceeded 500 billion yuan ($70.2 billion). Affected by a high base a year prior, the scale of investment attraction decreased year-on-year, but remained at a relatively high level in the context of the past decade. In particular, nearly 32,000 foreign-funded enterprises were newly established in China in the first seven months, a year-on-year increase of 11.4 percent, according to official data.

In an era of global economic instability and rising protectionism, a dip in FDI is to be expected, particularly from a high base. Yet, China remains focused on finding opportunities amid challenges. As the country fosters high-quality development, foreign investment is shifting from short-term "hot money" to long-term commitments, with stronger institutional and innovation capacities.

China's commitment to high-standard opening-up provides ample opportunities for foreign investors to engage in its industrial transformation, consumer market growth and urban development, allowing them to gain significant benefits.

A recent Harvard Business Review article listed four key strengths of China's economy, namely its innovation ecosystem, investment in the Global South, ultra-competitive markets and 1.4 billion consumers, and suggested that leaders of multinational corporations seize opportunities in China.

With a steadfast commitment to high-standard development and high-level opening-up, as well as a willingness to share its growth with global partners, China will remain a leading destination for foreign investors. As many foreign executives believe, the next China is still China.

Xinhua