China FDI Up 7 Percent in August

Sept. 17 – Foreign direct investment into China rose by 7 percent compared to the same period last year, the first rise in the past 11 months.

Chinese state media reported that the mainland attracted US$7.5 billion in foreign investment during August. However, Ministry of Commerce spokesman Yao Jian cautioned against optimism, saying that one month’s figures were not enough to suggest a recovery was in place from the global economic crisis.

According to Chris Devonshire-Ellis, the founding partner of Dezan Shira & Associates – the firm behind this publication – inquiries for new, first time investment into Asia at the firm had “nearly completely dried up” in the first half of this year but were now “starting to show signs of recovery across the board,” in China, India and Vietnam.

“Twelve months ago, MNcs globally cut back on plans for international investment and what plans there had been were put on hold.” Devonshire-Ellis said. “Now we are seeing an increase in interest in FDI throughout Asia, however I do not expect any strong recovery until global investment budgets for 2010 have been put in place and signed off by the boards of such companies. Assuming the worst is over then I believe we may start to see FDI pick up from Q2 next year.”

Dezan Shira & Associates helps foreign companies with FDI in China by providing business advisory, corporate establishment, audit, accounting, tax and payroll services.