FDI in figures

The absorption of FDI flow is part of China's opening up to the outside. According to a recent report by Ernst & Young, China has become the most attractive country for FDI. China is an unexploited market and a potential for considerable growth due to several reasons:
- It's the biggest internal market in the world with 1.3 billion potential customers;
- it's a rapidly growing market (minimum 8% growth per year); and
- the labor costs are low even if this situation is changing in certain areas;
- with the development of the Western provinces, China offers new opportunities, particularly in the Sichuan province.

Why you should choose to invest in China

Strong points

China has a rapidly expanding market, which was not overly affected by the 2008-2009 financial crisis. With a strong potential, a wealth of employees and potential partners eager to learn and evolve, the country is a base for low cost production.

Weak points

A changing legal context, administrative complexity, the difficulty for foreigners to learn the way of conducting business, both culturally and in practice, a poor middle management level and a very high staff turnover are factors which are often crippling in market acquisition.

Government measures to motivate or restrict FDI

In the foreign investment guide published by the State Commission for Development and Reform in November 2007, the Chinese government made it known that investments in sectors or Chinese companies that already have "a relatively strong production capacity with advanced technologies 'will not be encouraged', while investments in high technology, production of equipment and new materials, and in the services sectors, as well as in the recycling economy, clean production, use of renewable energies and environmental protection, will be welcomed as they are sectors in which China needs foreign companies.

Bilateral investment conventions signed by China

China has signed bilateral agreements for investments with several countries.
To see the list of the countries, click here.
To see the conventions, click here.

Procedures relative to foreign investment

Freedom of establishment

Varies according to the sector. Necessity to submit its 'business plan' for prior approval to setting up.

Acquisition of holdings

The acquisition of majority interest in a local company is authorized in China according to the sectors.

Obligation to declare

The agency for promotion of foreign investments in the country facilitates getting information on authorizations necessary for setting up.

Competent organization for the declaration

Requests for specific authorizations

Necessity for all projects to submit a business plan subject to approval by competent authorities.

Finding assistance for further information

Investment aid agency

Invest in China

Other useful resources

The heading dedicated to business opportunities of the Chinese agency for international investors