Foreign direct investment (FDI) into China was down to US$30 billion (S$40.3 billion) in 2023, a level not seen since the 1990s and almost 90 per cent less than the peak inflows of 2021. Forward-looking indicators, such as announced greenfield investments and mergers and acquisitions, also show a distinct move away from investment in China.
Clearly, attitudes towards investing in China are changing. Numbers from fDi Intelligence, a service that tracks announced FDI deals, suggest that China will continue to lose share in global FDI – and that India, Vietnam, Mexico and others are gaining. Surveys of the European and American chambers of commerce also reveal a growing share of companies that seek diversification away from China.
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