On June 8, the Ministry of Commerce held its regular press conference. Spokesman Sun Jiwen answered the hot issues that concern media at home and abroad. Here is the record.
Q: UNCTAD released the World Investment Report 2017 —— Investment and Digital Economy on June 7, according to which, Chinese outward FDI increased while the inward FDI decreased in 2016. What is the comment of MOFCOM on these two numbers?
A: We have noted that according to the World Investment Report 2017 —— Investment and Digital Economy published by UNCTAD on June 7, Chinese outward FDI registered 183 billion dollars in 2016, a historical high, and FDI inflow to China was 133.7 billion dollars, declining by 1% year on year.
According to the statistics of MOFCOM and the State Administration of Foreign Exchange, Chinese businesses invested 183.2 billion dollars as FDI in 2016 (among which 170.1 billion was in the non-financial sector), making China the second largest home country for FDI for two consecutive years. The fast-growing Chinese outward FDI has not only benefited Chinese companies, helping Chinese products, equipment, technologies and services going abroad and transforming and upgrading Chinese economy, but also boosted economic growth of host countries and the world, thus enabling mutual benefit and common development. Our statistics show that overseas sales of Chinese businesses reached 1.5 trillion dollars, paid 40 billion dollars in tax to host countries, and hired 1.5 million foreign employees.
The Report also shows that the FDI inflow to China decreased by 1% from the previous year. The stability of Chinese inward FDI was hard-won against the backdrop of the general fall of transnational investment and a drastic 15% decline of FDI to Asian developing countries. Meanwhile, the FDI inflow has been more concentrated in high-end industries. In 2016, China’s hi-tech service industries utilized over 95.5 billion yuan of foreign investment, an 86% increase compared with the previous year. The Report ranks China as the third largest recipient of FDI, testifying to the fact that China remains to be an attractive destination to global investors.
Q: The Business Confidence Survey in 2017 released by the European Union Chamber of Commerce in China on May 31 indicated that over half of European companies in China were disappointed at China’s investment climate, believing they were less welcome in China, and half of its member companies claimed suffering from discrimination. What are MOFCOM’s comments?
A: We have noticed the criticism and suggestions on China’s investment climate by some European companies from the Business Confidence Survey in 2017 released by the EU Chamber of Commerce in China.
I want to emphasize two things here.
First, China has always been committed to opening its market to foreign capital. China will never close its door but only open it wider. Investors from Europe are always welcome in China. However, China and the EU have different priorities, momentum and tempo in terms of opening up due to the differences in economic development and industrial structures. Areas and levels of opening up cannot simply be compared. It is not about reciprocating every sector that is opened up. What matters most is to strike a balance between the overall benefits for the two sides.
Second, we’ve noted that the Business Confidence Survey indicates a majority of European companies in China have seen improved performance. Among responding enterprises, 55% reported an increase in revenue in 2016, a rise of five percentage points from 2015. 71% said their profits before taxes approached the 2011 peak. 51% planned to expand presence in China, increasing by four percentage points on the basis of 2016. 55% held an optimistic view on growth, a rise of 11 percentage points compared with 2016. 61% believed China plays an increasingly important role in their global strategies. All these show that European companies’ investment confidence and returns in China have a marked increase instead of decrease.
According to the State Council’s Measures on Expanding Opening Up and Actively Utilizing Foreign Investment, MOFCOM and other relevant departments and local governments are working to speed up reform on the foreign investment administration regime, slash restrictive measures and create and uphold a level playing field. We will look at the comments and suggestions proposed by the Survey conscientiously, hold seminars to invite more views from foreign companies and associations in China when appropriate and actively coordinate with relevant ministries to address reasonable concerns.
Data source: Ministry of Commerce People’s Republic of China