Assistant Minister of Commerce Chen Jian attended and addressed the Press Release of the Country-Specific Report Series for Promoting China’s Overseas Investment. The following is the full text of his speech:

The coastal city Xiamen once again has the honor to welcome the distinguished guests from all over the world. On the occasion of the 10th China International Fair for Investment and Trade, on behalf of the Ministry of Commerce, let me extend my warm welcome and sincere thanks to the distinguished guests and friends from all circles attending the Press Release of the Country-Specific Report Series for Promoting China’s Overseas Investment.

It is China’s new guideline for the opening up endeavor in the new era to adhere to making paralleled efforts in attracting foreign investment and investing abroad to uplift the overall level of opening up. It is a key strategic decision made by the Chinese government in order to adapt to the new circumstances brought about by the economic globalization and China’s WTO membership, to better engage itself in the international competition and cooperation in wider areas and at higher levels, and to better utilize both the domestic and international markets and resources.

It is well-known that owing to the increasing economic globalization, countries all over the world are getting more and more interconnected. Reinforcing international cooperation, giving full play to each party’s advantages to make up its short points and ultimately achieve common development, is not only the keen wishes of all peoples in the world, but also the natural choice of every nation that seeks for economic development opportunities and ways to confront the challenges from globalization. China's "Going Global" strategy is beneficial to both the economic development of China, and better regional economic cooperation and common development of all countries.

The global economy is running well, and the trend will go on in the coming period of time. The latest IMF report in April this year raised its forecast on the world economic growth in 2006 to 4.9%, 0.6 percentage point higher than its prediction in last September. 2006 will then be the fourth consecutive year with economic growth of over 4%. It is predicted that in 2007, the global economy will grow also at a high speed of 4.7%.

The global cross-border FDI shows the following tendencies:
1, The global FDI is picking up its growing speed. After it dropped to the bottom in 2003, global FDI began to recover in 2004. In 2005, it reached US$ 895 billion, up by 29%. According to a survey by UNCTAD, most multinational companies, experts and investment promotion agencies are optimistic about the growth of FDI in the short and medium term .
2, The proportion of FDI to developing countries is steadily growing. The share rose from 27% in 2003 to 31.4% in 2005. In 2004, it even created a historical record of 35%. In general, the gap between the developed and developing countries is shrinking. The Asia-Pacific region continues to be a popular area for FDI, while southeast Europe, CIS countries and Africa have a huge potential.

3, FDI to the developed countries regains a rapid growth. In 2005, the FDI flowing to the developed countries increased by 38% year on year. In 2005, the UK and the US were the top 2 countries in terms of FDI inflow, boasting US$219 billion and US$106 billion respectively.
4, Cross-border merge and acquisition remains to be the main form of foreign direct investment.
5, The off-shore outsourcing of multinational companies’ internal services is more and more popular, becoming a key engine for cross-border direct investment. With the rapid development of the information technology, multinational companies, for the sake of saving cost and improving their competitiveness, begin to outsource some of the services.

We should also take note of the risks facing global FDI. UNCTAD believes these risks include investment and trade protectionism, lower-than-predicted economic growth in industrialized countries, unstable financial situation in the major sources of FDI, global terrorism, price fluctuation of oil and other raw materials, etc. All this problems may affect the prospect of FDI growth in the short and medium term.

With the development of the Chinese economy and industry restructuring, more and more Chinese companies are investing abroad, covering increasingly wider sectors. Examples include China Petroleum, SINOPEC, Haier, Lenovo, Huawei, ZTE, and WONCORE, which have taken the lead in investing abroad. A larger number of SMEs in different industries, out of the need to develop themselves, are also making overseas investment. It has become an important way for companies to internationalize.

In order to better implement the strategy of “Going Global” and provide more information to the business community, under the guidance of the Ministry of Commerce, the Investment Promotion Agency, in cooperation with the IPAs of the relevant countries as well as some academic institutes, drafted the Country-Specific Report Series for Promoting China’s Overseas Investment. These report series, taking into consideration the key concerns of the businesses, present country-specific information on such major aspects of each country’s different investment environment and characteristics as macro economic situation, industry structure, investment laws, policies and incentive measures, taxation regulations, procedures for the establishment of foreign-invested enterprises, investment cost, daily life tips, and investment services. With rather complete, accurate, easy to read and needy information, the Report Series can be considered an authoritative and valuable reference. It is a good guide for Chinese companies that are looking for a proper place and sector to invest, or new business opportunities and development space.

With the further development of the Chinese economy, there will be more Chinese companies expanding globally in the future. However, the Chinese companies are still at the beginning stage in making overseas investment. There is a long way to go for them to become successful multinational corporations. The Chinese government will, as always, support and encourage the qualified companies to invest globally by offering them more services.

I hope, the Investment Promotion Agency, as a professional agency for investment promotion in China, will continue to implement the strategy of “ Attracting in FDI” and “Going Global” by offering more and better services conducive to expanding cross investment and other forms of international cooperation and communication in order for common development.


Assistant Minister Chen Jian addressed at the Press Release of the Country-Specific Report Series for Promoting China's Overseas Investment


(Source: Network Center of MOFCOM)