Published on 16.02.2012

China in Focus: Spreading the Wealth

The geographical distribution of inbound FDI continues its dramatic shift.

According to the Economist Intelligence Unit, China's richest regions owe much of their success to the early advantages derived from openness to foreign direct investment. Inland China is set for a comparable influx of outside funds in the next five years, as the geographical distribution of inbound FDI continues its dramatic shift. The proportion of the long-favoured rich eastern provinces in total FDI fell from 80% in 2000 to 60% in 2010 as foreign investors pressed further inland. The move beyond the traditional centres is set to continue the Economist Intelligence Unit forecasts that the share of the eastern seaboard in total FDI will fall below one-half by 2015. Among the new FDI powerhouses from inland China, Chongqing in particular is set for impressive gains as it overtakes traditional FDI destinations like Shanghai.