In 2023, the actual use of foreign capital in the country will reach 11,339100 million yuan, although a year-on-year decrease of 80%, but this is not a signal of "foreign capital withdrawal" from China. Notably, in the third quarter, China's balance of payments foreign direct investment (FDI) saw a net outflow of US$11.8 billion, the first time since the State Administration of Foreign Exchange (SAFE) released quarterly data in 1998, which has sparked a lot of discussion and speculation.
However, in the complex context of the current global economic environment, such flows are in line with the laws of the market. Global foreign direct investment (FDI) fell by 18 per cent across the board last year, with inflows from advanced and developing economies falling by 28 per cent and 9 per cent, respectively. Faced with the impact of multiple factors such as the slowdown in world economic growth, rising geopolitical risks and weakening external demand, the investment confidence of enterprises has been greatly reduced, and volatility is inevitable. Although there has also been a withdrawal of foreign capital in China, it has been stable and progressive, and it is not as unbearable as the outside world portrays.
Zhang Fei, deputy director of the Foreign Investment Research Institute of the Ministry of Commerce Research Institute, pointed out: "China's investment scale accounts for about 15% of the world's total, which still ranks first among developing countries and the forefront of the world. "Since breaking through the trillion yuan mark for the first time in 2020, the scale of China's foreign investment has remained at this level, and many of the foreign investment withdrawn from China are labor-intensive low-end industries, which is the inevitable result of China's industrial transformation and upgrading, in line with the law of economic development, and is not worth exaggerating.
This is also confirmed by the latest data on German investment in China, which increased by 43%, reaching an all-time high of 11.9 billion euros. In the past three years, German companies have invested as much in China as in the previous six years combined, which shows that German investment confidence in China has been steadily increasing.
Although some countries** have been working hard to decouple from China, the reality shows that this approach is difficult to stop companies from investing in China. The West's decoupling plan has been challenged, which is completely contrary to objective economic laws and simply not feasible. The U.S. is trying to push for the so-called "U.S.-China decoupling," but this is only a means of self-comfort. The United States turned its attention to other markets, trying to reorganize the ** chain with these countries, only to find that it was impossible to bypass China. Mexico has overtaken China to become the largest importer of the United States, but this is largely because many factories in Mexico simply relabel "Made in China" goods and sell them to the United States, and these goods are not counted in the China-US quota. The protectionist policy of the United States ultimately hurt its own economy, and the war provoked by Trump also ignored the deep integration of the Chinese and American economies, resulting in serious losses for the American economy.
U.S. Treasury Secretary Janet Yellen has warned that a rift in the U.S. economy will have a serious impact on the relationship between the two countries and the global economy, which will affect the advancement of major issues such as global climate change, economic recovery, and artificial intelligence. The single-mindedness of the United States has led to the partial decoupling of China and the United States, which will have an impact on both the United States and China. However, China has its own ** chain and industrial chain, which ensures the resilience of the economy and can calmly deal with the crisis when it comes, while the United States does not have such a large room for manoeuvre.
Protectionism has distanced the global economy from the United States, which has tried to isolate itself from the outside world, but in turn has led to the isolation of the United States. Despite this, the United States is still trying to build its own ** chain by co-opting other countries, but due to China's growing economic influence, the United States has been unable to stop China's economic development.
China is booming in the global field, and its "Belt and Road" initiative has brought huge development opportunities to countries along the route, which also provides a platform for cooperation between China and other countries. Despite all the attempts of the United States** to exert pressure on China, China's economy has maintained a strong growth momentum, which has also made the United States feel more anxious. However, the unilateralist approach of the United States will eventually be countered, because the global economy is no longer separated, and China has become an indispensable and important link. Kunpeng Project