China draws more foreign investors in January, witnessing a y-o-y growth of 74.4%: Ministry of Commerce
Multinational companies remain optimistic about the development opportunities in the Chinese market, evident in their great enthusiasm in investing more in China, an official from China's Ministry of Commerce (MOFCOM) said on Friday, as the nation welcomes a good start to the Year of the Dragon.
Despite the skepticism in the West over China's market attractiveness to foreign capital, the number of newly established foreign-invested enterprises has increased significantly in the first month of 2024, against the background of continuous growth last year.
Data from MOFCOM on Friday shows that in January, there were 4,588 newly established foreign-funded enterprises in China, a year-on-year increase of 74.4 percent.
China attracted 127.69 billion yuan ($17.74 billion) in foreign investment last January. Due to factors such as a high base, the data of this January showed a slight decline, but there was a 20.4 percent increase month-on-month, the ministry's official said.
The strong foreign investment was reflected in the robust stock market on Friday, an indication that foreign investment continues to enter the Chinese market.
The structures of foreign investment have continued to improve in terms of industries.
Investment in high-tech manufacturing increased by 40.6 percent in January, of which the medical equipment and instrumentation manufacturing industry jumped by a whopping 558.8 percent, continuing the trend of industrial structure optimization and manufacturing recovery growth since last year.
The robust growth stands as strong evidence of how foreign enterprises are involved in industrial transition and upgrade in China against the backdrop of the nation's continuous promotion of high quality development of the economy, the MOFCOM official said.
In a notable trend, the investment growth from some developed countries has shown a faster pace, despite the intensified hype by some Western media and politicians over "foreign capital leaving China."
Specifically, investment in China from countries including Germany, Australia and Singapore saw big growth. Germany's investment grew by 211.8 percent year-on-year, followed by a 186 percent increase from Australia and 77.1 percent from Singapore, according to the data from MOFCOM.
Generally speaking, the investment situation in January continued the characteristics of last year's scale fluctuation and structural optimization, the official said.
In 2024, the ministry will continue to increase its efforts to promote foreign investment. The ministry will make good use of the foreign-funded enterprise roundtable and problem and appeal collection and management system for foreign-funded enterprise in China to further deepen communication with foreign-funded enterprises and help solve difficult problems, the official said.
The remarks came as the A-share market saw robust growth on Friday, closing at 3,000 points, the first time returning to this level since December last year. The active influx of foreign investors is considered one of the driving factors.
On Wednesday, the net inflow of northbound funds was approximately 13.6 billion yuan, reaching a new high since 2024, and continued the net inflow trend on Thursday, according to media reports.
The Chinese government's efforts to improve the market situation for foreign investors have been intensified.
From Thursday to Friday, the 2024 national foreign investment work conference, chaired by China's Vice Minister of Commerce and Deputy International Trade Representative Ling Ji, was held in Beijing. The meeting noted that attracting and utilizing foreign investment is of great significance to building a new development pattern, promoting high-quality development, and achieving Chinese modernization.
Commerce units of all levels are urged to fully implement the opinions on further optimizing the foreign investment environment and increasing efforts to attract foreign investment.
The meeting calls for the further strengthening of service guarantees for foreign-invested enterprises and projects and continuing to optimize the foreign investment environment.