Foreign direct investment in China has declined for a third month. The commerce ministry said at a briefing in Beijing investment fell 5.7% to $5.98 billion in December from a year earlier.
House prices in the nation’s 70 major cities fell for the first time on record in December, and exports are waning because of recessions in the U.S. and Europe.
Ma Yu, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation in Beijing, said, ‘Multinationals will become even more cautious in expanding. A lot of the foreign investment that rushed to China over the past few years to gain from a stock and property boom is leaving.’
The number of new companies set up by U.S. investors in China fell 32% in the first 11 months of last year. For European investors, the decline was 23%.
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