Beijing: China`s foreign direct investment (FDI) rose an annual 1.7 percent last year, although the pace slowed from 2013 as a cooling economy and shifting drivers of growth weighed on offshore investment flows.
China attracted a record $119.56 billion from foreign investors last year compared to $117.6 billion in 2013, the Ministry of Commerce said in a statement on its website on Thursday.
Outbound direct investment (ODI) surged 14.1 percent to a new high of $102.9 billion as Chinese corporate appetite for foreign investments grew, although ODI failed to overtake FDI as some had predicted, the commerce ministry told reporters on Friday. ODI growth, however, slowed from 16.8 percent in 2013.
Growth in FDI also slowed from 5.3 percent in 2013, and was the weakest in two years, indicating that the economic cooldown and shifting composition of the Chinese economy are starting to temper foreign sentiment.
Investment flows into China are an important gauge of the health of the world economy and is also a good indicator of where capital is flowing within the country.
The data showed that the government-led shift away from investment-heavy industries toward services and consumption is taking hold with service sector FDI increasing 7.8 percent, while manufacturing FDI declined 12.3 percent.
Services made up 55.4 percent of overall FDI, with manufacturing taking up 33.4 percent.
FDI in December leapt 10.3 percent from the same month in 2013 to $13.32 billion, MOFCOM said.
Investment from South Korea rose 29.8 percent year-to-date, the fastest in 2014, followed by Britain with 28 percent growth. Japanese FDI fell 38.8 percent while EU investment declined 5.3 percent.
Data next week is expected to show China posting its lowest annual gross domestic product growth in 24 years.
The central government has acknowledged that GDP will slow as it seeks to reform the economy and find new engines of growth, all while navigating the risks of a cooling property market, excess factory capacity and sluggish investment.
