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Foreign Companies Up in Number, Down in Capital

Experts have weighed in on fresh foreign investment figures from China's Ministry of Commerce

By Zhang Qingchen Updated Aug.25

China added 17,703 newly-funded foreign companies between January and July, up 12 percent on the same period last year, according to figures from China's Ministry of Commerce. But total foreign investment dropped 1.2 percent year on year to 485.42 billion yuan (US$72.66 billion) for the same period. 

The numbers split experts, with some saying China's popularity as a foreign investment destination had decreased, while others said they merely showed a natural fluctuation. 

Chen Fengying, a researcher at the China Institutes of Contemporary International Relations, described the situation as a temporary downturn in comments reported by the Party news portal People's Daily Online

At present, China was in an economic and industrial transition and foreign businesses had been forced to adapt to new policies, Chen said. But the increase in new foreign companies showed foreign investors were bullish about China’s new industries, she said.

Zhao Ping of the China Council for the Promotion of International Trade said China's approach to courting foreign investment was changing, seen in efforts to optimize the business environment and narrow gaps between domestic and foreign investment, as well as reducing restrictions.