China‘s foreign direct investment inflows dropped 2.4 percent in the first four months of 2012 versus last year, the longest period of declining inflows since the depths of the global financial crisis and a sign of external economic headwinds.
The Commerce Ministry said on Tuesday that the country drew $37.9 billion in foreign direct investment (FDI) between January and April, down from $38.8 billion attracted in the same period in 2011. April’s inflow alone was $8.4 billion, down from $8.5 billion a year ago.
“We believe the negative trend reflects concerns over China’s lower growth potential, lack of confidence in the global growth outlook, and poorer access to funding from deleveraging banks,” Dariusz Kowalczyk, senior economist and strategist at Credit Agricole-CIB in Hong Kong, said in a note to clients.
“It is worrying that despite very favourable base effects, foreign direct investment is continuing to shrink,” he…
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