January foreign investment in China dips 7.3%, extends fall

BEIJING (REUTERS) - China's foreign direct investment (FDI) inflows fell 7.3 per cent last month from a year earlier, extending last year's series of consecutive year-on-year declines and highlighting still sluggish global economic conditions.

The Commerce Ministry said on Wednesday that China drew US$9.27 billion (S$11.49 billion) in FDI last month, down from December's US$11.7 billion. Investment inflows from key Asian economies and the United States were down in the latest period.

FDI is an important gauge of the external economy to which China's vast factory sector is oriented, though it is a small contributor to China's overall capital inflows compared with exports, which were worth about US$2 trillion last year.

The FDI data followed stronger-than-expected trade figures, which pointed to a solid recovery in domestic and external demand that signals the world's second-largest economy is gaining momentum after growth last year eased to a 13-year low, albeit at a 7.8 per cent clip that is the envy of the world's major economies.