Foreign direct investment (FDI) in China rose to a new high of US$61 billion in 2004 from US$54 billion in 2003, making it the world's third largest investment destination, according to a United Nations study. Only the US with an FDI of US$96 billion and the UK with US$78 billion recorded higher totals. But these figures, which contrasted a 14% overall drop in FDI flows to industrialized countries, can be explained by increased activity in the volatile merger and acquisitions market as opposed to Asia's "greenfield" investments. China and Hong Kong accounted for two-thirds of all foreign investment coming into Asia.
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