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China's use of foreign direct investment (FDI) is expected to increase 5 percent over last year despite the gloomy world economic outlook, Ma Xiuhong, assistant minister of Foreign Trade and Economic Cooperation (MOFTEC), said yesterday.
This is an indicator that FDI in China has bailed out of the negative influences of the 1997 Southeast Asian financial crisis and picked up steam.
Due to the financial tumult, China's use of FDI stalled in 1998, declined by 11.37 percent in 1999 and rose only by 0.93 percent year-on-year, according to statistics from MOFTEC.
Ma said a slowdown in the world's economic growth would cause investors to be cautious and even delay their investment decisions.
But, she said, China's rapid economic growth for three years and the country's good economic performance in the first quarter of this year would make the country a favoured target for foreign investors against the gloomy background of world economic outlook.
China's gross domestic product increased by 8.1 percent in the first quarter, higher than many economists had predicted, an official report of the National Bureau of Statistics said on Tuesday.
Ma said the Chinese Government would also try its best to attract foreign investors into the country.
She said the government is revising the directory of industries that foreign investors are encouraged, restrained or forbidden to enter.
"We will bring out the directory as soon as possible,'' Ma said at a press briefing on the fifth China International Fair for Investment and Trade (CIFIT) in Beijing yesterday.
She said it's possible that the directory will come out before China joins the World Trade Organization (WTO).
She refused to disclose details on the revision but said it will expand the number of industries that foreign investors are encouraged to enter and relax the control on foreign investors' entrance.
Ma also highlighted the important role of the annual CIFIT event in attracting foreign investments.
The CIFIT, sponsored by MOFTEC and co-organized by the Fujian provincial government and the Xiamen municipal government, takes places in Xiamen from September 8 to 12 each year.
During the first four sessions of the fair, a total of US$48.3 billion foreign capital was contracted to finance 9,141 projects and trade volume of US$3.8 billion has been achieved, according to the organizers.
Zhang Xunhai, deputy director of the foreign investment department of MOFTEC, said the fair will also encourage domestic companies to invest overseas while attracting foreign investors.
Seminars on the investment policies of China, South Africa, Egypt, Jordan, Nigeria, Viet Nam, South Korea, Brazil, Chile and Mexico will be held during the fair, he said.
He added cooperation in the information technology industry, auto manufacture industry and chemical industry was also a dominant theme at the fifth session of the fair.
(China Daily 04/19/2001)
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