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MOFCOM Department of Outward Investment and Economic Cooperation Comments on the Outward Investment and Cooperation Situation of China in January-July

On August 16, official of MOFCOM Department of Outward Investment and Economic Cooperation made a comment on China’s outward investment and cooperation in January-July of 2016. In January-July, China’s outward investment and cooperation maintained a good development trend. Chinese domestic investors carried out the non-financial direct investment in 5,465 outward enterprises in 156 countries and regions, with an accumulative investment of RMB$ 673.24 billion (US$ 102.75 billion), up 61.8% year on year. The contract value of newly signed foreign contract projects was RMB 746.82 billion (US$ 102.75 billion), up 3.6% year on year. By the end of July, there were 995,000 Chinese labors overseas.

The official introduced that, China’s outward investment and cooperation presented the following features in January-July:

1. The outward investment maintained a rapid growth with a steady growth rate. Since the beginning of this year, China’s direct investment outward has been keeping a steady growth with the investment outward volume exceeding the utilization volume of foreign investment. China has become a net capital exporter. At the same time, the growth of investment outward was steady. In July, the direct investment outward reached US$ 13.89 billion, down 9.5% month on month, going down for three consecutive months compared with that of April, whose investment outward reached US$ 19.99 billion.

2. The investment regions were relatively centralized, and the developed countries and regions grew rapidly. In January-July, the Chinese inland’s investment in Hong Kong, ASEAN, EU, Australia, U.S., Russia and Japan reached US$ 75.09 billion, accounting for 73.1% of the total direct investment outward in the same period. The investment flow to the U.S., Germany and Australia grew rapidly, with the rate reaching 210%, 200.6% and 74.3%.

3. M&A has become the main pattern of direct investment outward and large-scale M&A projects increased. In January-July, the Chinese enterprises carried out 459 M&A projects in 63 countries and regions, covering 15 industries like information transformation, software and information service and manufacturing, with the actual transaction amount reaching US$ 54.3 billion, accounting for 52.8% of the total investment outward over the same period. The actual transaction volume of M&A in January-July has surpassed the total volume of 2015, and the proportion in the total outward investment in the same period also exceeded that of 2015, which was 34%. There were 12 projects whose actual M&A volume were over US$ 1 billion.

4. Investment and cooperation in countries related to “Belt and Road” saw steady progress with large growth potential.
From the day when the “Belt and Road” was proposed to July this year, China had invested US$ 51.1 billion in related countries, accounting for 12% of China’s total direct investment outward; there are 12.5 thousand newly-signed contract projects with the countries alongside , with the contract volume reaching US$ 279 billion; there are 52 economic and trade cooperation zones established by Chinese enterprises in related countries, with the investment reaching US$ 15.6 billion, creating US$ 0.9 billion tax revenue and about 70,000 jobs for the host country.