Increasing emphasis on services investment

Foreign companies committed US$28.4bn in service-company investments in 2003, a 49.7% year-on-year increase, according to He Manqing, a deputy director of the ministry's Multinational Research Centre. Contracted foreign investment targeting manufacturing rose only 36.2%, she told an investor conference in Beijing. The data corroborates what the OECD and other groups have found in changing FDI trends, namely that investors are targeting services to capture opportunities generated by China's fast-growing middle-class consumer market. Foreign multinationals invested US$550bn setting up half a million enterprises in the last 20 years, according to the Ministry of Commerce. Manufacturing overall still accounts for 72.8% of foreign investment over the two decades, but that share would decrease as financial services companies invested more as restrictions were lifted, she said.