China’s Foreign Investment Attraction Efforts: A Positive Outlook for the Future

Despite a slight decrease in foreign investment capital in the first quarter of 2023, China has made efforts to attract more investors and improve the business environment. According to data released by the Chinese Ministry of Commerce, foreign investment in the first quarter fell by 26.1%, amounting to 301.7 billion yuan or 41.7 billion USD, but this was still stronger than the same period in 2019. The decline can be partly attributed to a high base in the same period last year, but it is important to note that compared to the fourth quarter of 2023, foreign investment capital increased by 41%.

Speaking at the Boao Forum for Asia last month, deputy director of China’s foreign exchange administration Xu Zhibin stated that China’s foreign direct investment developments were “basically in line with global trends.” He emphasized that China is making efforts to attract more investors and improve its business environment, as seen in Premier Li Qiang’s pledge at the China Development Forum in Beijing in March to implement reforms and create a “more open China” and collaborate with the world.

In response to these efforts, on April 19, China announced measures to promote foreign investment. These measures include support for foreign organizations to issue bonds domestically and loosening restrictions on foreign strategic investments in Chinese listed companies. Beijing is also encouraging foreign technology companies to raise funds through bond issuance and creating favorable conditions for foreign investors to participate in Chinese technology companies. Additionally, the country plans to approve foreign investment in Chinese stocks and bonds efficiently.

Overall, despite a slight decrease in foreign investment capital in the first quarter of 2023, China remains committed to attracting more investors and improving its business environment. The government’s initiatives are expected to have a positive impact on future investments and help drive economic growth.