China has emerged as the world’s third largest investor as foreign direct investment (FDI) from the Communist giant jumped by 17.6 per cent last year defying a global pattern, according to the 2012 Statistical Bulletin of China’s Outward Foreign Direct Investment (ODI) by the Ministry of Commerce.
Even as global ODI slid 17 per cent last year amid uncertainties facing the world economy,
China is now the world’s third-largest investor, following the US and Japan. China currently holds about $3.30 trillion foreign exchange reserves. About $1.20 trillion is invested in US bonds.
China was the world’s sixth-largest investor in 2011, with an ODI flow of $74.65 billion. Last year’s increase represented acceleration from 8.5 per cent in 2011, when the global economic recovery was weak in the face of continuing financial turmoil in Europe and the US.
The surge in ODI was mainly driven by domestic enterprises eager to tap overseas markets and profit from using global resources. Whereas the Chinese Government has introduced measures to encourage outbound direct investment in pursuit of the ‘going abroad’ strategy, and the country’s outward FDI maintained robust growth in recent years.
China’s non-financial ODI went up 13.3 per cent last year to $77.73 billion, accounting for 88.5 per cent of the total. Financial ODI surged 65.9 per cent to $10.07 billion, the bulletin said. Investment in the US jumped 123.5 per cent to $4.05 billion, making it the second-largest destination for China’s ODI, the report said. The total ODI to the developed economies was around $13.51 billion. Chinese investors have established about 22,000 overseas enterprises in 179 countries and regions, “and about 79.2 per cent of them made profits or maintained a balance.
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