China FDI growth to pick up amid challenges

Foreign direct investment (FDI) in China will rebound in 2015 on the back of a robust expansion in the first six months, Vice Commerce Minister Wang Shouwen has said.

Wang expected the FDI in China for the whole 2015 to grow around four percent to 125 billion U.S. dollars, compared with a 1.7-percent expansion recorded in 2014.

Official data showed on Friday that the FDI rose eight percent in the first half of the year to 68.4 billion U.S. dollars, accelerating sharply from 2.2 percent in the same period last year.

Wang attributed the improvement to China's continued efforts in widening pilot reforms in free trade areas, fewer government restrictions and active promotion of opening up in certain industries and inland areas.

However, he warned that FDI growth will probably drop in the latter half mainly due to a slow economic recovery in major FDI sources and the tapering of U.S. quantitative easing.

China became a net capital exporter for the first time in 2014 when the FDI was outnumbered by outbound direct investment (ODI).

In the first six months of 2015, China's ODI grew 29.2 percent to 56 billion U.S. dollars, a higher speed but less volume than that of the FDI.