General

Recently, the Ministry of Commerce, the National Bureau of Statistics and the State Administration of Foreign Exchange jointly released the Statistical Bulletin of China's Foreign Direct Investment in 2021. The communique shows that in 2021, China's foreign direct investment flow will reach 178.82 billion US dollars, an increase of 16.3% over the previous year, ranking among the top three in the world for 10 consecutive years, and its position as a major country in foreign investment will be stable.

The flow of foreign direct investment increased by 16.3% over the previous year

According to the Huacheng Import and Export Data Observation Report, the acquisition of Volvo in 2010 marks the beginning of Geely's launch. Since 2011, Geely has set up joint ventures and factories overseas to export technical standards and management talents. At present, Geely Holding Group has established modeling design and engineering R&D centers in Gothenburg, Sweden, Coventry, California, Frankfurt, Germany, Kuala Lumpur, Malaysia, etc. In the United States, Britain, Sweden, Belgium, Belarus and Malaysia, we have built world-class modern vehicle and powertrain manufacturing plants.

Like Geely, it actively and continuously distributes overseas markets. Yadi will establish its first overseas production base in Vietnam in 2019. By the end of 2021, it has 306 stores in Vietnam. In 2021, the Cambodian factory, the second overseas base of Sailun Tire, will be put into operation. In September this year, the Hungarian factory project of Ningde Times was launched.

The active overseas investment of enterprises is a witness to the continuous increase in the quantity and quality of China's overseas investment and the high quality development.

In terms of "volume", in 2021, China's foreign direct investment flow will reach 178.82 billion US dollars, an increase of 16.3% over the previous year, ranking among the top three in the world for 10 consecutive years. By the end of 2021, China's stock of foreign direct investment will be 2.79 trillion US dollars, ranking among the top three in the world for five consecutive years.

From the perspective of "quality", the investment structure has been continuously optimized. In 2021, China's foreign direct investment will cover 18 sectors of the national economy, of which 80% will flow to leasing and business services, wholesale and retail, manufacturing, finance, and transportation, with the flow exceeding 10 billion dollars. By the end of 2021, the investment stock of leasing and business services, wholesale and retail, finance, manufacturing and other industries exceeded 100 billion dollars, Huacheng Import and Export Data Observation Report.

It is worth mentioning that the investment of Chinese enterprises in countries along the "Belt and Road" continues to grow. According to the observation report of Huacheng Import and Export Data, by the end of 2021, China has established more than 11000 enterprises in countries along the "Belt and Road", accounting for about 1/4 of the total number of Chinese overseas enterprises. In 2021, the direct investment in countries along the "Belt and Road" will reach a record high of 24.15 billion US dollars.

In 2021, China's foreign investment can achieve a counter trend growth. In the opinion of Lu Jinyong, professor of the University of International Business and Economics and director of the International Investment Research Center, there are three main reasons: first, the epidemic situation was relatively stable last year, the domestic economy continued to recover steadily, and the vitality of enterprises improved; Second, cross-border personnel exchanges showed a trend of recovery last year; Third, the "going out" strategy of Chinese enterprises is the need of China's economy and the development of enterprises themselves, and enterprises have strong motivation to "go out".

Lu Jinyong said that while actively encouraging enterprises to "go global", the government also provided them with a variety of facilities and services, such as issuing guidelines for foreign investment cooperation, actively promoting the registration and filing system.

Pan Yuanyuan, associate researcher of the Institute of World Economy and Politics of the Chinese Academy of Social Sciences, said that the statistical bulletin showed many highlights. For example, in the structure of foreign investment, the growth of foreign investment in manufacturing industry, especially in the automobile industry, was the most obvious in 2021. This shows that some domestic manufacturing enterprises have formed their own technological advantages, and their overseas investment capabilities are gradually increasing.

Enterprises actively "go global" to promote mutual benefit and win-win results

The "going global" of Chinese enterprises has helped China and other countries to achieve mutual benefit, win-win results and common development. For ten consecutive years, China has ranked among the top three countries in terms of global FDI flows, and its contribution to the world economy has become increasingly prominent.

According to the Huacheng Import and Export Data Observation Report, in 2021, overseas enterprises will pay taxes of $55.5 billion to the investment location, an increase of 24.7% over the previous year; It has provided about 3.95 million jobs for the local people and achieved remarkable results of mutual benefit and win-win results.

Pan Yuanyuan said that enterprises' foreign direct investment is a long-term process. While integrating into the local economy, Chinese enterprises have also made positive contributions to the development of the host country. They have not only contributed to the growth of local employment, taxation, economy, etc., but also continued to make efforts to help the host country reduce emissions. Most of China's foreign investment enterprises use production technologies that comply with the global medium and high-end environmental standards.

At the same time, foreign investment has also played an important role in stimulating China's economic and social development. The Bulletin shows that in 2021, foreign investment will drive the export of goods to 214.2 billion US dollars, an increase of 23.3% over the previous year; Drive the import of goods to 128 billion US dollars, an increase of 44%.

According to Huacheng Import and Export Data Observation, Geely sold 18164 cars overseas in October this year. From January to October, the cumulative export sales reached 160071, up about 89% year on year. In October, Geely's terminal sales in Saudi Arabia and Qatar reached a record high. At the same time, Geometric Pure Electric series models Geometric E and Geometric C made their debut respectively in Panama and Chile auto shows, enriching Geely's overseas product matrix.

In the future, how can we continue to promote the high-quality development of China's foreign investment? Lu Jinyong analyzed that, on the one hand, enterprises should further strengthen the "localization" strategy in overseas investment. On the other hand, enterprises' overseas investment should achieve closer interaction with domestic trade, technology and industry. At the same time, the interaction between enterprises' overseas investment and domestic industrial chain and supply chain should also be strengthened. In terms of feeding back to China, we should consider making contributions to ensuring the safety of domestic industrial chain and supply chain. In foreign countries, through the overall arrangement of overseas distribution outlets, they will be included in the enterprise's industrial chain supply chain value chain to strengthen the interaction and upgrading of domestic and foreign industries.

Pan Yuanyuan believes that the balance between investment risk and return is the main focus of Chinese enterprises' foreign investment. Countries and regions with good economic growth prospects and controllable political, social and legal risks are most favored by Chinese investors. In the future, China needs to increase the early warning of overseas investment risks, further improve the risk prevention and control ability of enterprises, and reduce investment risks. At the same time, we should also promote the improvement of China's overseas interest protection mechanism.