FDI into China falls to loweat in four years

16 Sep 2014

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China's foreign direct investment was down in August to its lowest level in over four years, in the latest sign that the second-largest economy in the world was losing steam.

Even as foreign-investment figures tended to fluctuate from month to month, the reading on today from China's Ministry of Commerce came as the third consecutive monthly decline.

It also came amid growing weakness in the economy's industrial production, fixed asset investment, manufacturing and real estate sector. Foreign investment fell last month from the US, Europe, Japan and Southeast Asia, the ministry said in a statement, while it was up from South Korea and the UK.

Market Watch quoted Oliver Barron, Beijing-based senior analyst with North Square Blue Oak, an investment bank as saying, with the Chinese data recently, a slowdown in industrial China, the older economy, had been seen. He added, this suggested FDI was reflecting the overall trend of restructuring, as companies involved in those sectors saw a slowdown.

According to the commerce ministry, China attracted $7.2 billion of foreign direct investment in August, down 14 per cent from a year earlier, its lowest level since July 2010.

This compared with $7.81 billion in July, which was itself down nearly 17 per cent from a year earlier. FDI in the January-August period, meanwhile, was down 1.8 per cent as against  the year earlier to $78.34 billion.

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