FDI heads north

Government data showed foreign direct investment shifting directions in dramatic ways. Hainan-bound FDI plummeted 60% year on year, and Fujian-bound FDI 39%, in the first seven months of 2004. Guangdong, once the recipient of the lion's share of FDI, recorded a year-on-year decline of 10% in the first seven months of 2004, Shenzhen falling by 18%. The gainers included Yunnan province, which saw FDI skyrocket 578%, and western Shanxi with 203%. Guangxi Autonomous Region and the northern coastal provinces of Shandong and Liaoning made up the rest of the top five FDI gainers, all with increases near 100% or above. A ministry of commerce official said foreigners had a better understanding of the China market and were adjusting investments and spending more, moving more aggressively into financial services, the chemical and energy sectors, car-making, telecommunications, logistics and consumer products.