BEIJING, Nov 13 (Reuters) - Chinese firms wanting to invest overseas are likely to turn more to developing countries in the face of rising protectionism in the West, the head of one of the country's biggest banks funding overseas development said on Thursday.
China, which often says its companies face barriers in investing in the West, is currently awaiting a Canadian ruling on state-owned CNOOC Ltd's $15.1 billion bid to buy Nexen Inc.. Canada has delayed its decision twice.
"We can expect that in the near future, the trend of slow growth and high unemployment in some economies won't change, resulting in added layers of protectionism against Chinese companies and rendering their "going out" more difficult," Li Ruogu, president of the Export-Import Bank of China, said in a written response to Reuters questions.
Ex-Im Bank is one of the main source of loans for Chinese firms, particularly state-owned firms, investing abroad.
China's response will be to diversify markets and broaden trade and investment ties with developing countries, he wrote.
That strategy would run counter to the trend of the few years since the global financial crisis, when Chinese firms shifted their focus from resource or infrastructure investments in Africa, Australia, Asia and Latin America to buying corporate stakes in mature markets, particularly Europe.
China is still more of an investment destination than a source of funds, but that is changing. Ministry of Commerce figures show China attracted almost twice as much foreign investment as it made in 2011.
The Ministry's calculations show inbound foreign direct investment (FDI) rose 9.7 percent last year. Outbound non-financial FDI grew just 1.8 percent in 2011, but improved considerably in 2012, rising nearly 29 percent on year in the first nine months to total $52.5 billion.
Officials want that to average 17 percent in the five years to the end of 2015, amassing $560 billion of investments in the process.
China's sovereign wealth fund will focus more of its $482 billion firepower on Asia both to beat a rise in protectionism in the West and to boost exposure to rapid regional growth, chairman and chief executive Lou Jiwei told Reuters in an interview earlier this week.
Chinese officials responding to questions about protectionism during this week's Communist Party congress have not mentioned opening their own market further to foreign investment. Chinese protectionism is a growing complaint from foreign companies seeking to buy stakes or gain market access in China.
Li said he expected more industrial consolidation in China, particularly among state-owned firms, but added that the market would determine the scale.