China January foreign direct investment rises in sign of confidence

Tue Feb 18, 2014 6:11am EST
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BEIJING (Reuters) - China drew $10.76 billion in foreign direct investment (FDI) in January, up 16.1 percent from a year earlier, the Commerce Ministry said on Tuesday, a sign that confidence in the world's second-largest economy remains firm even as growth cools.

The majority of the new investment, some $6.33 billion, went into China's services industry, while investment in manufacturing fell 21.7 percent, the ministry said.

Ministry spokesman Shen Danyang told a media briefing that China's economic reforms and opening up of the services sector, helped boost confidence of foreign investors.

"The double-digit growth in FDI in January answered the question of whether China's investment environment remains favorable," Shen said.

"We expect foreign direct investment to maintain sound momentum this year."

China has shifted its focus on attracting FDI inflows to high-end manufacturing, a modern services sector and energy saving and environmental industries, Shen said.

FDI in China's distribution services sector rose 7.4 percent in January from a year earlier, while FDI in the telecommunications equipment and computer sector rose 9.2 percent and that in the transportation equipment sector tumbled 62 percent.

China has attracted a steady flow of foreign investment every year since joining the World Trade Organization in 2001, as businesses jumped at the chance to enter the world's most populous country.

FDI inflows into China in 2013 rose to a record $117.6 billion.   Continued...

People stand outside a UNIQLO shop in Beijing, August 24, 2013. REUTERS/Petar Kujundzic