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Ministry of Commerce and Other Authorities Issue the 2018 Statistical Bulletin of China’s Outward Foreign Direct Investment

On September 12, the Ministry of Commerce, the National Bureau of Statistics and the State Administration of Foreign Exchange jointly issued the 2018 Statistical Bulletin of China’s Outward Foreign Direct Investment (hereinafter referred to as the Bulletin), officially releasing the statistics of China's OFDI in 2018.

The Bulletin is divided into six parts, introducing China's OFDI situation: the brief situation of China's OFDI, features of China's OFDI, China's OFDI in major economies, the composition of the OFDI, regional and industry distribution of OFDI enterprises, and comprehensive statistical data.

The Bulletin shows that China's OFDI in 2018 mainly has the following characteristics:

First, OFDI’s flow and stock ranked among the top three in the world, the proportion of both hitting a record high. In 2018, China’s OFDI was US$143.04 billion, down 9.6% year on year. Under the situation that the total OFDI outflow decreased by 29% year on year globally, falling for 3 years continuously, slightly lower than that of Japan (US$143.16 billion), , China becomes the second-largest foreign investor. At the end of 2018, China's OFDI stock reached US$1.98 trillion, 66.3 times of the stock at the end of 2002. Its OFDI stock rose from 25th to 3rd from the perspective of countries and regions, second only to the US and the Netherlands. China's influence on global OFDI has been expanding. The proportion of China’s flow rate in the world has exceeded 10% for three consecutive years, and in 2018, the number became 14.1%, up 3 percentage points over that of the previous year. At the end of 2018, the stock amount accounted for 6.4%, up 0.5 percentage points over that of the previous year. Each percentage point is a record high. From the perspective of two-way investment, China's OFDI in 2018 is basically the same as China’s foreign investment attraction.

Second, the investment covered 188 countries and regions around the world, and the stock of investment was relatively concentrated. By the end of 2018, more than 27,000 Chinese domestic investors had established 43,000 OFDI enterprises in 188 countries and regions around the world, and more than 80% of the countries (regions) in the world had Chinese investment. China has set up more than 10,000 overseas enterprises in the countries along the Belt and Road routes. In 2018, the direct investment flow was US$17.89 billion, and the year-end stock was US$172.77 billion, accounting for 12.5% and 8.7% respectively. The geographical distribution of China's OFDI was highly concentrated, with the top 20 countries (regions) accounting for 91.7% of the total.

Third, the investment industry was widely distributed and the categories were complete. The stock of the six major industries exceeds US$100 billion. In 2018, China's OFDI covered 18 major sectors of the national economy. Among these, leasing and business services, finance, manufacturing, wholesale and retail, and other industries accounted for over 70% of the total investment. The investment flowed mainly to information, scientific research and technical services, electricity production, culture, and education grew rapidly. The stock in the six major areas of leasing and business services, wholesale and retail, finance, information transmission, manufacturing, and mining all exceeded US$100 billion, accounting for 84.6% of China's OFDI stock.

Fourth, the OFDI of local enterprises rose against the trend, and the proportion of foreign investment in non-public economic holdings increased. In 2018, non-financial OFDI flow of local enterprises reached US$98.26 billion, with a year-on-year increase of 14%, accounting for 81% of non-financial flow nationwide. The OFDI of Guangdong, Shanghai and Zhejiang ranked among the top three in 2018. The non-public economic domestic holding entities invested US$75.57 billion in 2018, with a year-on-year increase of 11.2%, accounting for 62.3% of total OFDI, increasing by 13.6 percentage points over the previous year.

Fifth, overseas enterprises made significant contributions to the taxation and employment of the host country, and the win-win effects of foreign investment were remarkable. In 2018, the total amount of taxes paid by overseas enterprises to the countries where they invested was US$59.4 billion, employing 1.877 million foreign employees, accounting for more than half of the total number of employees in overseas enterprises, increasing by 167,000 compared with that of the end of the previous year. In 2018, the overseas Chinese enterprises were in good operating condition, and over 70% of the enterprises were profitable or leveled off.



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