China expects foreign investment to stay steady at $60 billion in 2006, report says
SHANGHAI, China – China expects foreign investment to remain at about $60 billion in 2006 and has no plans to restrain such flows from overseas, a state media report said Monday.Foreign direct investment in 2005 totaled $60.3 billion in 2005, down 0.5 percent from 2004, when such investment totaled $60.6 billion, the Commerce Ministry reported.China’s heavy reliance on foreign investment to build up its industrial sector, especially export manufacturing, has prompted a debate over whether the country might be too dependent on outside funding – and vulnerable to sudden downturns due to external shocks, such as the Asian financial crisis of the late 1990s.A Commerce Ministry official, Hu Jingyan, downplayed such concerns.”So far, no sectors in any parts of China have been monopolized by foreign funds, which are by no means in control of China’s economic life line,” the official Xinhua News Agency cited Hu as saying.The report said foreign investment accounts for less than 3 percent of the market share in industries which are key to the nation’s economic development, said Hu, director of the ministry’s Foreign Investment Department.Hu said foreign investment was mainly focused on the high-tech, machinery and electronics industries.China’s accumulated foreign direct investment totals $600 billion, accounting for about 35 percent of the country’s gross domestic product, a little bit higher than the world average level, the report said.But taking into account the country’s population of 1.3 billion, foreign direct investment per person is only $41, less than half the world average, it said.
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