February 21, 2017 / 4:30 AM / 2 years ago

Foreign investment is not leaving China: commerce minister

BEIJING (Reuters) - China’s commerce minister on Tuesday sought to assuage concerns that foreign investment is leaving the country, saying claims to that effect were “biased.”

China's Commerce Minister Gao Hucheng attends a session during the 2016 G20 Trade Ministers Meeting in Shanghai, China July 10, 2016. REUTERS/Aly Song

In comments made to reporters, Gao Hucheng didn’t elaborate on the ministry’s views though data over the past few months have shown a pick up in fund outflows.

“In recent years some products have indeed moved offshore but at the same time many high-end industries have moved to China,” Gao told reporters.

Foreign direct investment to China fell 9.2 percent in January to 80.1 billion yuan.

An annual survey from the American Chamber of Commerce in China released last month showed that more than 80 percent of its members felt less welcome in China than before and most had little confidence in China’s vows to open its markets.

Since late last year, authorities have also been tightening restrictions on capital outflows, reining in what officials have called “irrational” outbound investment.

The curbs probably explained a fall in outbound direct investment, which plummeted 35.7 percent in January to 53.27 billion yuan, the weakest in over a year.

Gao added that consumption will continue to grow rapidly this year, while the foreign trade environment will remain complex.

Cooperation is the only option for the U.S.-China trade relations as a healthy relationship is beneficial for both sides, he said.

Although there have been disagreements between the two countries in the past, they were solved through negotiation, Gao added.

Tensions between China and the United States have heightened since the start of the year after U.S. President Donald Trump criticized Beijing for harming American companies and consumers by devaluing its yuan currency.

Throughout his election campaign, Trump threatened to levy punitive tariffs against China in order to bring down the U.S. trade deficit, keeping global markets on edge.

Reporting by Elias Glenn; Writing by Sue-Lin Wong; Editing by Shri Navaratnam

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