China Becomes World’s Second-Largest Source of Outward FDI

CHINA ROSE TO THE POSITIONof the world's secondlargest source of outward foreign direct investment (FDI) for the first time in 2016, according to the World Investment Report 2017 published on June 8. The United States remained the largest investor worldwide, while the Netherlands ranked third.

FDI outflows from China increased 44 percent yearon-year to US$183 billion last year, driven by a surge in cross-border mergers and acquisitions by Chinese firms, according to the report, which was jointly released by the United Nations Conference on Trade and Development (UNCTAD) and the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce.

James Zhan, director of UNCTAD's investment and enterprise division, said China's outward investment will stay at a high level as the country pushes forward Belt and Road development and international industrial capacity cooperation. However, the country's outbound investment needs improvement in quality and may face challenges from protectionism, Zhan cautioned.