China News Agency, Beijing, December 28th: The story of foreign capital entering China is not over
China News Agency reporter Xia Bin
In recent years, foreign media have hyped up the words "foreign capital withdraws from China" every once in a while, but in the face of the facts, such voices always seem so "weak".
Look at the latest two sets of data.
On the one hand, foreign capital is accelerating its deployment in the Chinese market.
According to the Ministry of Commerce of China, from January to November this year, the actual use of foreign capital in the country was 1.15609 billion yuan (RMB, the same below), which has exceeded the scale of last year and increased by 9.9% year-on-year on a comparable basis.
South Korea, Germany, Britain, and Japan have the highest growth in investment in China, of which South Korea's actual investment in China has increased by 122.1%.
The Hyundai hydrogen fuel cell power system project base with a total investment of 5 billion yuan was settled in Guangdong, the new factory of Siemens CNC Nanjing Co., Ltd. with a total investment of more than 2 billion yuan was put into operation, and L'Oreal "joined hands" with Shanghai to establish the first investment company in China... This year Since then, many well-known foreign companies have spent real money to invest in projects, build new factories, and expand production capacity in China.
On the other hand, foreign capital bought A shares.
Entering November, the net inflow of northbound funds resumed. As of December 22, the total net inflow of northbound funds was 92.2 billion yuan, and it reached 101.787 billion yuan in the past year.
In fact, for any open capital market, it is normal for foreign capital to enter and exit in stages, and the same is true for A shares. Looking at it from a longer time perspective, short-term net outflows have never changed the foreign capital’s interest in A shares. "Long Love".
Why can China maintain the strong momentum of foreign capital inflow?
One is the potential to accommodate foreign capital.
In short, there is still a large gap between the proportion of foreign capital utilized in the Chinese market and the allocation of Chinese assets in global institutions, compared with the global status of the Chinese economy.
Andrew McFarrie, Global Chief Investment Officer of Fidelity International, said bluntly that a multi-asset portfolio is very attractive to investors. Compared with the size of the Chinese market, Chinese assets are still "underweight" in the world, and there will still be growth in the future potential.
According to statistics from the United Nations Conference on Trade and Development, China's foreign direct investment will reach a record US$181 billion in 2021, ranking second in the world.
However, the flow and stock of China's FDI (foreign direct investment) accounted for only 1% and 11.9% of GDP respectively. These two indicators ranked 19th among the top 20 economies that attracted the most foreign investment in the world. China, the second largest economy, remains a "blue ocean" for foreign investment.
The second is the ability to introduce foreign capital.
Plant a sycamore tree and attract the phoenix to live there.
Insisting on expanding opening up and improving the business environment, China has made concerted efforts in policy support and system reform to make foreign investment into China more efficient and convenient.
It can be seen that China has further reduced the negative list of foreign investment access this year, gradually relaxed the access threshold in key areas, and continued to reduce market access restrictions; six cities including Shenyang, Nanjing, Hangzhou, Wuhan, Guangzhou, and Chengdu were included in the expansion of the service industry. Open comprehensive pilot projects; release the "Catalogue of Industries Encouraging Foreign Investment (2022 Edition)" to further create a first-class business environment that is market-oriented, ruled by law, and internationalized.
The two-way opening of the financial market is always on the way: expanding the scope of Shanghai-Shenzhen-Hong Kong Stock Connect, officially launching ETF transactions under the interconnection; establishing and improving the system for foreign institutional investors to participate in the exchange bond market; studying and formulating policies for foreign capital to apply to specific short-term trading systems, etc. .
China's open attitude has injected confidence and broadened channels for foreign capital to enter the capital market.
The third is to retain the charm of foreign investment.
It is the core appeal of foreign capital to "add money" to hope to catch the "free ride" of China's growth. No one wants to miss the "gold nuggets" opportunity behind the good prospects of China's economy.
At present, most of China's economic data has recovered, and the cyclical upward trend of macro fundamentals has gradually established. Many institutions' forecasts for China's GDP growth next year are quite "bright".
The International Monetary Fund predicts that China's GDP growth rate will be 4.4% in 2023, which is 1.7 percentage points higher than the global average expected growth rate in 2023.
According to the latest report of the International Financial Forum, the global economic growth will reach 2.8% in 2023, and the Chinese economy is expected to grow by 4.6%, significantly higher than the global economic growth rate.
BHP Billiton CEO Mike Henry recently attended a conference organized by Reuters, saying that China has all the basic elements needed for sustained economic growth in the next 20 years, and the endogenous power of China's economic development will continue to increase.
Foreign media bad-mouthing China's economy can't stop foreign capital from "voting with their feet" towards China.
As Xing Ziqiang, Chief China Economist of Morgan Stanley, said recently when looking into China's economic prospects, the story of China's attracting foreign capital inflows is not over yet.