Published on 16.08.2012

China - More inland choices

Until just a few years ago, the Pearl River Delta (PRD), Yangtze River Delta (YRD) and the Beijing-Tianjin axis were regarded as the three prime areas for foreign investment. Now they have been joined by a reinvigorated north-east—especially Liaoning province and, more specifically, the city of Dalian. For certain types of industries, such as electronics, a handful of inland clusters (notably Chengdu and Chongqing in western China) have also become attractive venues.

Inland opportunities have provided an impetus for foreign companies to continue to move fresh funds into the country. The 2008-09 global financial crisis reversed the investment growth trend briefly, with foreign direct investment (FDI) dipping by nearly 3% in 2009. However, according to the Ministry of Commerce, growth resumed the following year with an increase of 17% in 2010, followed by a further rise of 9.4% in 2011 to US$116bn. FDI flows declined by 3% in the first six months of 2012, as companies paused their investment plans owing to greater uncertainty in the global economy, but are likely to pick up again next year.

Full article at EIU.com