Xiuping Zhang

Provincial Competitive Industries

This chapter is divided into 4 parts to introduce the past and present condition of provincial industries in the eastern, central, western and northeastern provinces in Mainland China.

History of Foreign Investment in China

This book focus on investing in Mainland China and investment abroad from Mainland China. The foreign investment in China started in 1979 from the first Sino-foreign joint ventures called Beijing Aviation Food Co., LTD. Since then, the foreign direct investment in China developed in a dramatic speed. Since 1993, China has become the largest developing country in the world to attract foreign direct investment (FDI for short), and in 2002 it surpassed the United States as the world’s first foreign direct investment host. At end of 2015, China has approved a total of 838,087 foreign investment projects, and the amount of actual utilization of foreign capital has accumulated to 1479.401 billion dollars.

Development Report of Asia Direct Investment in China

The first stage (2000–2005), Japan’s investment in mainland China ushered in a new development stage of synchronous growth with the world’s investment in mainland China. The total contract amount reached

Chinese Policies on Encouraging Foreign Investment

3.68 billion in 2000. In 2001, the growth rate of Japanese companies’ investment in mainland China far exceeded that of the world’s investment in mainland China, the total contract amount and the total use amount both accounted for more than 40%. In 2002, its investment in mainland China continued to show growth momentum, and Japanese companies accelerated in transferring its production bases to China, as China was increasingly becoming a global production base after joined the WTO. Annual report by Japan External Trade Organization noted that the main reason for a substantial increase of Japan’s investment in China in the second half of 2005 was that Japanese automobile manufacturers began to invest in China by a large-scale. Simultaneously, Japanese electronics manufacturers started to expand investment, increasing the supply of electronic products in China’s market. In addition, Japan’s investment of chemical pharmaceutical, finance and insurance, wholesale and retail, machinery and other industries in China surpassed

Policy of Overseas Investment

254 million.

Chinese Investment in Asia

The changes of Chinese policies on foreign capital began from the Convention of the 3rd Plenary Session of the 11th Central Committee of the Communist Party of China in December 1978. In this session, the central government decided to shift the focus of the work from political movement to the economic development, to reform and open up, and to accelerate the pace of socialist modernization. Since 1978, the process of FDI encouragement policies of China have been consistent with the reform and opening up. It’s an important part of China’s economic system reformation. The FDI encouragement policy in China can be summarized into two aspects, namely, FDI regional policies and FDI industrial policies, which will be represented in detail in the following two sections.

Chinese Investment in South America

The Chinese government has launched a series of policies and measures to support foreign projects contracting and foreign investments, even set up a Foreign Economic Cooperation Fund to support enterprises to explore the international markets.

Chinese Investment in North America

South Asia contains more than 1.6 billion residents, and the large population not only creates tremendous market demand directly but also supplies abundant cheap labor force. South Asian countries have rich natural resources, which consist of 14 mineral resources such as petroleum, natural gas, coal, copper, iron and so on. Constrained by funds and technology, these resources market is not well developed at present, but has great potentialities. Given the fact that infrastructure construction is delayed, the governments in South Asian countries need to construct a batch of large-scale roads, ports, airports, railways, power facilities and telecommunications. It predicts a broad market in engineering construction and electric power development. In a sum, the huge population, abundant natural resources and enormous size of to-be-built infrastructure constructions arise great opportunity for Chinese and global firms.

Chinese Investment in Africa

In the process of China’s “go-out strategy”, China continue to increase foreign investment. The Middle East, central Asia, Africa are the main investment districts, because South America is distant, the investment to there is comparatively less than other place. However, in recent years, China has put more strength to South America. The investment to the South American market has been significantly increased; Greely group, Geely automobile, etc. have been entering to the market of the South America.

The History of Chinese Direct Foreign Investment

In the past 10 years, China’s direct investment in North America showed a rising trend. The investment area gradually expands and the investment industries increased diversely. Mergers and acquisitions in North America were more active than other regions.