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Investment flows and stocks

  • (1) Characteristics of China’s OFDIflows in 2015
  • 1) RAPID GROWTH TO SECOND PLACE IN THE WORLD

The year 2015 saw a slow economic recovery in developed economies, a slowdown in the growth of developing economies, and an overall weak recovery and slow growth of the world economy on the whole. China’s OFDI rose against the adverse trend to an all-time high of US$145.67 billion, up 18.3% year-on-year, higher than average global growth. With a flow of US$299.96 billion, China overtook Japan to take the second place after the United States. China’s OFDI, USS 10.9 billion more than the foreign investment it received, exceeded the latter for the first time. Since the authoritative release of annual data by relevant departments in China in 2003, China’s OFDI had increased for 13 consecutive years. The flow in 2015 was 54 times the 2002 level. The annual growth rate from 2002 to 2015 was as high as 35.9% (see Figure 1.14). During the 12th Five-Year Plan period, China's OFDI amounted to USS539.08 billion, 2.4 times as much as in the 11th Five-Year Plan period.

2) OFDI SURPASSES FDI TO MAKE CHINA A NET CAPITAL EXPORTER

In 2015, China actually used US$135.58 billion of foreign capital, up 6% year-on-year, ranking third in the world. China’s OFDI totaled USS 145.67 billion, US$10.09 billion higher than the amount absorbed in the same year, and became a net capital exporter in direct investment for the first time. Measures

China’s OFDI flow, 2002-2015

Figure 1.14 China’s OFDI flow, 2002-2015.

Note

Data for the period 2002-2015 is from the statistics of the Ministry of Commerce of China.

such as continuous improvement of China’s comprehensive strength, accelerated implementation of the Belt and Road Initiative and international capacity cooperation, constant improvement of outward investment policies, and the deepening of multilateral and bilateral practical cooperation have helped Chinese enterprises go global. China’s OFDI has entered a fast track of development (see Figure 1.15).

China’s inward and outward investment, 2009-2015

Figure 1.15 China’s inward and outward investment, 2009-2015.

3) ACTIVE M&A, FOCUS ON SPECIFIC FIELDS,

AND RAPID EXPANSION

In 2015, Chinese enterprises carried out 579 M&A (mergers and acquisitions) projects with outward investment in 62 countries (regions), with a total actual transaction value of US$54.44 billion, including direct investment17 of USS37.28 billion, about 68.5% of the total M&A transaction value and 25.6% of China’s OFDI of the year. Overseas financing in 2015 amounted to USS 17.16 billion, accounting for 31.5% of the M&A value. China’s outward investment and M&A in 2015 involved 18 industries, including manufacturing, information transmission, software and information technology services, mining, culture, sports and entertainment, leasing and business services, etc. The acquisition of a nearly 60% stake in Pirelli of Italy by China National Tire & Rubber Corporation with US$5.29 billion of outward investment is the largest overseas acquisition by a Chinese company in 2015. Compared with 2014, M&A projects were also carried out in the industries of water, environment and public facilities management. In terms of the transaction volume of M&A, the manufacturing industry ranked first with US$13.72 billion, up 13.4% year-on-year, involving 137 projects. The information transmission, software and information technology services industry ranked second with US$8.41 billion, a year-on-year increase of 135.6%. The M&A transaction value in the financial sector, which had grown significantly in the past two years, rose by 217.8% year-on-year to US$6.61 billion. Due to the continued downward trend in global bulk commodity markets and other factors, the M&A transaction value in the mining industry fell by 70.3% from 2014 (US$17.91 billion) to US$5.32 billion.

In 2015, Chinese companies carried out 101 M&A projects in BRI countries, the transaction volumes amounted to US$9.23 billion, accounting for 17% of the total. Among these countries, Israel, Kazakhstan, Singapore, Russia, Laos, etc., attracted more than USS1 billion of investment through M&A from Chinese companies (see Tables 1.9 and 1.10).

4) NEW EQUITY INVESTMENT EXCEEDED 60% FOR THE FIRST TIME.

SHARE OF DEBT INSTRUMENTS REACHED RECORD LOW

In 2015, new equity investment amounted to US$96.71 billion, accounting for 66.4% of the total flow of the year, up 21.1 percentage points from 2014. The reinvestment of earnings in 2015 was US$37.91 billion, accounting for 26.0% of the total, down by 10.1 percentage points from 2014. The reinvestment of equity and earnings in 2015 totaled US$134.62 billion, accounting for 92.4% of the total flow. Since the cost of overseas financing is lower than that in the Chinese Mainland, Chinese enterprises were increasingly involved in overseas financing in the Hong Kong SAR, and other places before making overseas investment, resulting in the reduction of loans provided directly by Chinese investors to overseas Chinese enterprises. The investment in debt instruments in 2015 stood at US$11.15 billion, down 51.9% from the US$22.99 billion of 2014. hitting a record low (see Table 1.11 and Figure 1.16).

Table 1.9 Industries concerned in China's outward investment via M&A in 2015

Industry

Number (minimum)

Actual transaction volume (USS 100 million)

Financial ratio x%

Manufacturing

131

137.2

25.2

Information transmission, software and information technology services

58

84.1

15.5

Finance

18

66.1

12.1

Mining

24

53.2

9.8

Culture, sports and entertainment

21

32.3

5.9

Leasing and business services

77

31.3

5.7

Accommodation and catering

11

27.1

5.0

Wholesale and retail sales

81

26.6

4.9

Real estate

21

20.7

3.8

Scientific research and technical services

43

17.6

3.2

Transportation, warehousing and postal services

11

16.1

3.0

Construction

9

11.2

2.1

Water, environment and public facilities management

4

8.8

1.6

Health, social work and social welfare

10

4.3

0.8

Power, heat, gas and water production and supply

5

3.8

0.7

Agriculture, forestry, animal husbandry and fishery

37

2.6

0.5

Life services, maintenance and other services

12

1.2

0.2

Education

6

0.2

Total

579

544.4

100

Table 1.10 M&A in China’s OFDI, 2004-2015

Year

Transaction value (USS 100 million)

Year-on-year growth (%)

Share (%)

2004

30.0

54.5

2005

65.0

116.7

53.0

2006

82.5

26.9

39.0

2007

63.0

-23.6

23.8

2008

302.0

379.4

54.0

2009

192.0

-36.4

34.0

2010

297.0

54.7

43.2

2011

272.0

-8.4

36.4

2012

434.0

31.4

2013

529.0

21.9

31.3

2014

569.0

7.6

26.4

2015

544.4

-4.3

25.6

Note

The transaction value of M&A from 2012 to 2015 includes overseas financing, and the share is the proportion of direct investment in the flow of the year concerned.

Table 1.11 Composition of China’s OFDI flow, 2006-2015

Year

Flow

New equity investment

Reinvestment of earnings

Investment in debt instrument

Amount (USS 100 million)

Share (%)

Amount (USS100 million)

Share (%)

Amount (USS 100 million)

Share (%)

2006

211.6

51.7

24.4

66.5

31.4

93.4

44.2

2007

265.1

86.9

32.8

97.9

36.9

80.3

30.3

2008

559.1

283.6

50.7

98.9

17.7

176.6

31.6

2009

565.3

172.5

30.5

161.3

28.5

231.5

41.0

2010

688.1

206.4

30.0

240.1

34.9

241.6

35.1

2011

746.5

313.8

42.0

244.6

32.8

188.1

25.2

2012

878.0

311.4

35.5

224.7

25.6

341.9

38.9

2013

1078.4

307.3

28.5

383.2

35.5

387.9

36.0

2014

1231.2

557.3

45.3

444.0

36.1

229.9

18.6

2015

1456.7

967.1

66.4

379.1

26.0

110.5

7.6

Note

The OFDI data for the period 2006-2015 include OFDI of all industries.

Composition of China’s OFDI, 2006-2015

Figure 1.16 Composition of China’s OFDI, 2006-2015.

5) COVERAGE OF A WIDE RANGE OF INDUSTRIES AND RAPID GROWTH IN THREE INDUSTRIES

China’s OFDI in 2015 involved 18 sectors of the national economy. Among them, its outward investment in the industries of manufacturing, finance, information transmission, software and information service, etc., grew faster.

China’s OFDI in the manufacturing industry in 2015 totaled US$19.99 billion, up 108.5% year-on-year, accounting for 13.7% of the total flow of the year. The investment mainly went to the manufacturing and production of automobiles, computers, communications equipment and other electronic equipment, raw chemicals and chemical products, special-purpose equipment, the rubber and plastic industry, pharmaceutical manufacturing, the textile industry, the manufacturing of railway, ship, aerospace and other transportation equipment, the non-metallic mineral product industry, etc. OFDI in equipment manufacturing amounted to US$10.05 billion in 2015, up 158.4% year-on-year, accounting for 50.3% of the total outward investment of the manufacturing industry.

China’s OFDI in the financial sector in 2015 stood at US$24.25 billion, up 52.3% from a year earlier, accounting for 16.6% of the total. Chinese financial institutions were active in OFDI in 2015, investing a total of US$24.43 billion abroad, including US$23.7 billion of direct investment in overseas financial enterprises and US$730 million in overseas non-financial enterprises. Chinese non-financial institutions invested US$550 million in overseas financial enterprises in 2015.

China’s OFDI amounted to US$6.82 billion in the information transmission, software and information technology sendees industry, up 115.2% year-on-year, accounting for 4.7% of the total. In the scientific research and technical services industry, China’s OFDI was US$3.35 billion, up 100.5% year-on-year, accounting for 2.3% of the total. Its OFDI in the culture, sports and entertainment industry amounted to US$1.75 billion, a year-on-year increase of 236.6%, accounting for 1.2% of the total. Its OFDI in the water, environment and public facihties management industry totaled US$1.37 billion, up 148.1% year-on-year, accounting for 1.1% of the total. Its OFDI in the accommodation and catering industry totaled US$720 million, a year-on-year increase of 195.5%, accounting for 0.5% of the total.

In 2015, among the major industries with OFDI from China, the transportation, warehousing and postal services industry contributed US$2.73 billion, down 34.7% year-on-year. China’s OFDI in the mining industry stood at US$11.25 billion in 2015, down 32% from a year earlier, and that in the leasing and business services industry amounted to US$36.26 billion (mainly in the form of shareholding), down 1.6% year-on-year (see Table 1.12 and Figure 1.17).

6) RAPID INCREASE IN INVESTMENT IN ASIA AND THE

AMERICAS AND REDUCTION IN INVESTMENT IN OTHER REGIONS

In 2015, China’s OFDI flows to Asia totaled US$108.37 billion, a year-on-year increase of 27.5%, accounting for 74.4% of the total OFDI flows of the year. The investment in the Hong Kong SAR for the year was US$89.79 billion, up 26.7% year-on-year, accounting for 82.9% of the total OFDI in Asia. Its outward investment in the 10 ASEAN countries was US$14.6 billion, up 87% from a year earlier, accounting for 13.5% of its outward investment in Asia.

In 2015, Chinese companies invested US$12.61 billion in Latin America, a year-on-year increase of 19.6%, accounting for 8.6% of the total flow of the year. This included US$10.21 billion into the Cayman Islands, US$1.85 billion

Table 1.12 Distribution of China’s OFDI flow in 2015, by industry

Industry

Flow ($100 million)

Year-on-year growth (%)

Share (%)

Leasing and business services

362.6

-1.6

24.9

Finance

242.5

52.3

16.6

Manufacturing

199.9

108.5

13.7

Wholesale and retail sales

192.2

5.1

13.2

Mining

112.5

-32.0

7.7

Real estate

77.9

17.9

5.3

Information transmission, software and information technology services

68.2

115.2

4.7

Construction

37.4

10.0

2.6

Scientific research and technical services

33.5

100.5

2.3

Transportation, warehousing and postal services

27.3

-34.7

1.9

Agriculture, forestry, animal husbandry and fishery

25.7

26.4

1.8

Power, heat, gas and water production and supply

21.3

21.0

1.5

Culture, sports and entertainment

17.5

236.6

1.2

Life services, maintenance and other services

16.0

-3.2

0.9

Water, environment and public facilities management

13.7

148.1

1.1

Accommodation and catering

7.2

195.5

0.5

Other

1.3

0.1

Total

1,456.7

18.3

100

China’s OFDI flow in 2015, by industry (unit

Figure 1.17 China’s OFDI flow in 2015, by industry (unit: US$100 million).

32 Development overview

Table 1.13 China’s OFDI flow in 2015, by destination

Economies

Amount

(US$100 million)

Year-on-year (%)

Share (%)

Asia

1,083.7

27.5

74.4

Latin America

126.1

19.6

8.6

North America

107.2

16.4

7.4

Europe

71.2

-34.3

4.9

Oceania

38.7

-10.7

2.7

Africa

29.8

-7.0

2.0

Total

1,456.7

11.5

100

Source: World Investment Report 2016 of the United Nations Conference on Trade and Development (UNCTAD).

into the British Virgin Islands, US$290 million into Venezuela and USS 120 million into Ecuador.

In 2015, Chinese companies invested US$10.72 billion in North America, up 16.4% year-on-year, accounting for 7.4% of the OFDI flow in that year. This included US$1.13 bilhon in Bermuda, up 59.2% year-on-year, USS156,000 in Canada, up 72.9% year-on-year and US$8.03 billion in the U.S., up 5.7% year-on-year.

In 2015, Chinese companies invested US$7.22 billion in Europe, down 34.3% year-on-year, accounting for 4.9% of the OFDI flow in that year. The investment mainly went to the Netherlands, Russia, the UK, Germany, France, etc. China's investment in the European Union amounted to USS5.48 bilhon in 2015, down 44% from 2014. China’s investment in Oceania stood at US$3.87 biflion in 2015, down 10.7% year-on-year, accounting for 2.7% of the OFDI flow in that year, which mainly went to Australia, New Zealand, Samoa, etc. China’s investment in Africa amounted to US$2.98 billion in 2015, down 7% year-on-year, accounting for 2% of the OFDI flow in that year. Its investment in Africa mainly went to Ghana, Kenya, South Africa, Tanzania, Congo (Kinshasa), Algeria, Uganda, etc. (see Table 1.13).

7) HIGH CONCENTRATION AND RAPID INVESTMENT

GROWTH IN BRI COUNTRIES

In 2015, nearly 80% of China's OFDI went to the Hong Kong SAR. the Netherlands, the Cayman Islands, the British Virgin Islands and Bermuda. They together absorbed US$116.44 billion of investment from China, accounting for 79.9% of the total. The overseas enterprises established by Chinese enterprises in these countries (regions) mainly engaged in business services. Up to 60% of China’s outward investment through M&A projects in that year were completed through reinvestment by these overseas enterprises.

China’s investment in the Hong Kong $AR in 2015 amounted to US$89.79 billion, accounting for 61.6% of the total flow of the year. The investment mainly went to leasing and business services, wholesale and retail sales, finance, mining, manufacturing, real estate, information transmission, software and information technology services.

China’s investment in the Netherlands in 2015 totaled US$13.46 billion, 9.2% of the total, which mainly went to mining, wholesale and retail sales, business services, and manufacturing.

China’s investment in the Cayman Islands in 2015 amounted to US$10.21 billion, 7% of the total, which mainly went to business services.

China’s investment in the British Virgin Islands in 2015 amounted to US$1.85 billion, 1.3% of the total, which mainly went to business services.

China’s investment in Bermuda in 2015 amounted to US$1.13 billion, 0.8% of the total, which mainly went to business services.

In 2015, China’s investment flow to BRI countries totaled US$18.93 billion, a year-on-year increase of 38.6%, doubling the increase in global investment and accounting for 13% of the total flow of that year. The top 10 recipient countries were Singapore, Russia, Indonesia, the United Arab Emirates, India, Turkey, Vietnam, Laos, Malaysia, and Cambodia.

8) SUB-NATIONAL INVESTMENT GREW STEADILY TO NEARLY

S0% OF THE TOTAL AND SHANGHAI, BEIJING AND GUANGDONG

ARE THE TOP THREE

In 2015, the sub-national non-financial OFDI flow of China reached US$9.36 billion, up 71.0% year-on-year, accounting for 77% of its flow of non-financial OFDI, constituting the main force of China’s OFDI in 2015. This included US$79.82 billion from East China, accounting for 85.2% of the sub-national investment flow, up 78.2% from 2014, US$7.45 billion from West China, accounting for 8.0% of the sub-national investment flow, up 14.2% from 2014, and US$6.33 billion from Central China, accounting for 6.8% of the subnational investment flow, up 84.7% from 2014. The top 10 Chinese regions in OFDI flow in 2015 were Shanghai, Beijing, Guangdong, Jiangsu, Shandong, Zhejiang, Fujian, Tianjin, Liaoning and Anhui. The outward investment of them totaled US$78.67 billion, accounting for 84% of the sub-national outward investment flow. Shanghai, Beijing and Guangdong were the top three, each contributing more than US$10 billion of outward investment in 2015 (see Tables 1.14 and 1.15).

Table 1.14 Sub-national OFDI flow in 2015, by region

Region

Flow (US$100 million)

Share (%)

Year-on-year growth (%)

East China

798.2

85.2

78.2

Central China

63.3

6.8

84.7

West China

74.5

8.0

14.2

Total

936

100

71.0

Notes

Central China incltides six provinces, namely Shanxi, Anhui, Jiangxi, Henan, Hubei and Hunan.

West China includes 12 provinces and municipalities, namely Inner Mongolia, Guangxi, Sichuan, Chongqing, Guizhou, Yunnan, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang and Tibet.

Table 1.15 Top 10 regions of sub-national OFDI flow in 2015

No.

Region

Flow (US$100 million)

Year-on-year growth (%)

1

Shanghai

231.8

364.4

2

Beijing

122.8

68.8

3

Guangdong

122.6

12.5

4

Jiangsu

72.5

78.1

5

Shandong

71.1

81.7

6

Zhejiang

71.1

84.0

7

Fujian

27.6

162.3

8

Tianjin

25.3

-39.0

9

Liaoning

21.2

43.5

10

Anhui

20.7

443.9

Total

786.7

-

  • (2) Characteristics of China's OFDI stock by the end of 2015
  • 1) CHINA RANKED HIGHER WITH A LARGER SHARE OF OFDI

IN THE WORLD

At the end of 2015, China's OFDI stock totaled USS1,O97.86 billion, an increase of USS215.2 billion from the end of 2014 and 36.7 times the stock at the end of 2002. The share in the global OFDI stock rose from 0.4% in 2002 to 4.4%, and the ranking in the world rose from 25th to 8th. China’s OFDI started late and entered a period of rapid growth after 2010. The stock is still far smaller than that of developed countries. China’s OFDI stock at the end of 2015 was only 18.3% of that of the United States, 60.6% of that of Germany and 71.4% of that of the UK (see Figure 1.18 and Table 1.16).

China’s OFDI stock, 2002-2015 (unit

Figure 1.18 China’s OFDI stock, 2002-2015 (unit: USS100 million).

Table 1.16 Top 10 countries (regions) in OFDI stock at the end of 2015

Ranking

Countries (regions)

OFDI stock at the end of 2015 (US$100 million)

Ratio of China 's OFDI stock to it (%)

1

U.S.A.

59,827.9

23.9

2

Germany

18,124.7

7.2

3

United Kingdom

15,381.3

6.2

4

Hong Kong SAR

14,856.6

5.9

5

France

13,141.6

5.3

6

Japan

12,265.5

4.9

7

Switzerland

11,381.8

4.5

8

China

10,978.6

4.4

9

Canada

10,783.3

4.3

10

Netherlands

10,742.9

4.3

Total

177,484.2

70.9

Source: The data of China’s OFDI stock by 2015 is from the statistics of China’s Ministry of Commerce, and the data of other countries (regions) is from World Investment Report 2016 of UNCTAD.

2) ASIA RECEIVED 70% OF CHINA’S OFDI AND DEVELOPING

ECONOMIES GOT S0%

At the end of 2015, China’s OFDI stock was distributed in 188 countries (regions) on six continents, accounting for 80.7% of the total number of countries (regions) in the world. Compared with 2014, Iceland, Saint Lucia and British Anguilla were new recipients of China’s outward investment, while investment in Burkina Faso discontinued.

At the end of 2015, China's investment stock in Asia stood at US$768.9 billion, accounting for 70% of the total, mainly distributed in the Hong Kong SAR, Singapore, Indonesia, the Macao SAR, Kazakhstan, Laos, the United Arab Emirates, Myanmar and Pakistan, India, Mongolia, the Republic of Korea, Cambodia, Thailand, Japan, han, etc. The Hong Kong SAR took 85.4% of the stock in Asia.

China’s investment stock in Latin America at the end of 2015 was USS 126.32 billion, or 11.5% of the total, mainly in the Cayman Islands, the British Virgin Islands, Venezuela, Brazil, Argentina, Ecuador, Peru, Trinidad and Tobago, Colombia, and Mexico. Specifically, the stock in the Cayman Islands and the British Virgin Islands combined amounted to US$114.07 billion, accounting for 90.3% of China’s investment stock in Latin America.

China’s investment stock in Europe at the end of 2015 stood at US$83.68 billion, 7.6% of the total, mainly distributed in the Netherlands, the UK, Russia, Luxembourg, Germany, France, Norway, Sweden and Italy.

China’s investment stock in North America at the end of 2015 amounted to USS52.18 billion, accounting for 4.8% of the total, mainly in the United States and Canada.

China’s investment stock in Africa at the end of 2015 was US$34.69 billion, or 3.2% of the total, mainly distributed in South Africa, the Democratic

China’s OFDI stock as of 2015, by region

Figure 1.19 China’s OFDI stock as of 2015, by region.

Republic of the Congo, Algeria, Nigeria, Zambia, Sudan, Zimbabwe, Ghana, Angola, Tanzania, Ethiopia, Kenya, the Republic of the Congo, and Mauritius.

China’s investment stock in Oceania at the end of 2015 was US$32.09 billion, accounting for 2.9% of the total, mainly distributed in Australia, Papua New Guinea, New Zealand, Samoa, and Fiji (see Figure 1.19).

Up to 80% of China’s outward investment stock is in developing economies. At the end of 2015, China’s investment stock in developing economies was US$920,887 billion, 83.9% of the total. This included US$656,855 billion in the Hong Kong SAR. accounting for 71.3% of the investment stock in developing economies, and US$62,716 billion in the ASEAN, accounting for 6.8% of the investment stock in developing economies. China’s investment stock in developed economies at the end of 2015 amounted to US$153,652 billion, accounting for 14% of the total, including US$64.46 billion in the EU, accounting for 41.9% of the investment stock in developed economies, US$40,802 billion in the United States, accounting for 26.6% of the investment stock in developed economies, US$28,374 billion in Australia, accounting for 18.4% of the investment stock in developed economies, US$8,516 billion in Canada, accounting for 5.5% of the investment stock in developed economies, US$3,471 billion in Norway, accounting for 2.3% of the investment stock in developed economies, and US$3,038 billion in Japan, accounting for 2% of the investment stock in developed economies (see Table 1.17 and Figure 1.20).

At the end of 2015, China’s OFDI stock in economies in transition18 amounted to US$23,321 billion, or 2.1% of its total stock. Up to 60.1% of China’s investment stock in economies in transition, or US$14.02 billion, was in Russia, 21.8% of such stock, or US$5,095 billion was in Kazakhstan, 4.6% of

Table 1.17 China’s OFDI stock in developed countries (regions) at the end of 2015

Country/economy

Stock (US$100 million)

Share (%)

European Union

644.60

41.9

U.S.A.

408.02

26.6

Australia

283.74

18.4

Canada

85.16

5.5

Norway

34.71

2.3

Japan

30.38

2.0

Bermuda Islands

28.61

1.9

New Zealand

12.09

0.8

Switzerland

6.04

0.4

Israel

3.17

0.2

Total

1,536.52

100.0

Composition of China’s OFDI stock as of 2015

Figure 1.20 Composition of China’s OFDI stock as of 2015.

such stock, or USS1.071 billion was in Kyrgyzstan, 3.9% of such stock, or USS909 million, was in Tajikistan, and 0.6% of such stock, or USS 133 million, was in Turkmenistan.

At the end of 2015, China’s OFDI stock in the top 20 countries (regions) in terms of China’s OFDI stock totaled US$988,059 billion, accounting for 89.8% of China’s OFDI stock. The top 20 countries (regions) were Hong Kong SAR,

Table 1.18 Top 20 countries (regions) in China’s OFDI stock at the end of 2015

No.

Country (region)

Stock (US$100 million)

Share (%)

1

Hong Kong SAR, China

6,568.55

59.8

2

Cayman Islands

624.04

5.7

3

British Virgin Islands

516.72

4.7

4

U.S.A.

408.02

3.7

5

Singapore

319.85

2.9

6

Australia

283.74

2.6

7

Netherlands

200.67

1.8

8

UK

166.32

1.5

9

Russian Federation

140.20

1.3

10

Canada

85.16

0.8

11

Indonesia

81.25

0.7

12

Luxembourg

77.40

0.7

13

Germany

58.82

0.5

14

Macao SAR

57.39

0.5

15

France

57.24

0.5

16

Kazakhstan

50.95

0.5

17

Laos

48.42

0.4

18

South Africa

47.23

0.4

19

United Arab Emirates

46.03

0.4

20

Myamnar

42.59

0.4

Total

9,880.59

89.8

China, the Cayman Islands, the British Virgin Islands, the United States, Singapore, Australia, the Netherlands, the United Kingdom, Russia, Canada, Indonesia, Luxembourg, Germany, Macao SAR, China, France, Kazakhstan, Laos, South Africa, the United Arab Emirates, and Myanmar (see Table 1.18).

At the end of 2015, China’s direct investment stock in BRI countries amounted to US$115.68 billion, accounting for 10.5% of China’s OFDI stock. The top 10 BRI countries that received China’s OFDI were Singapore, Russia, Indonesia, Kazakhstan, Laos, the United Arab Emirates, Myanmar, Pakistan, India and Cambodia.

3) WIDE DISTRIBUTION ACROSS INDUSTRIES WITH

OVER 80% CONCENTRATED IN FIVE INDUSTRIES

At the end of 2015, China's OFDI covered all industries of the national economy. The stocks in four industries exceeded USS 100 billion. The leasing and business sendees industry topped the list with a stock of US$409.57 billion, accounting for 37.3% of China’s OFDI stock, followed by finance with a stock of US$159.66 billion, 14.5% of the total, mining with a stock of US$142.38 billion, 13% of the total, and wholesale and retail sales with a stock of US$121.94 billion, 11.1% of the total. The OFDI stock of these four industries combined amounted to US$833.55 billion, accounting for 75.9% of China’s

OFDI stock. The distribution of China's OFDI stock in other major industries at the end of 2015 was as follows:

The manufacturing industry ranked fifth with a stock of US$78.53 billion, accounting for 7.2% of the total. The investment stock in the manufacturing industry was mainly distributed in the manufacturing of automobiles, computers, communications equipment and other electronic equipment, specialpurpose equipment, raw chemicals and chemical products and medicine, the rubber and plastic products industry, the manufacturing of textile, electrical machinery and equipment, ferrous metal smelting and rolling processing, nonferrous metal smelting and rolling processing, food production, textile and clothing, manufacturing of general-purpose equipment, metalworking, etc. Among them, China’s OFDI stock in equipment manufacturing amounted to US$31.38 billion, accounting for 40% of the investment stock in the manufacturing industry.

China’s OFDI stock in transportation, warehousing and postal services stood at US$3.91 billion, accounting for 3.6% of the total, mainly distributed in water transportation, cargo handling and other transportation agency services, air transportation, and pipeline transportation.

China’s OFDI stock in the real estate sector totaled US$33.49 billion, or 3.1% of the total.

China’s OFDI stock in the construction industry totaled US$27.12 billion and accounted for 2.5% of the total. The investment was mainly in-house construction, building decoration and other construction and installation services.

China’s OFDI stock in information transmission, software and information technology sendees accounted for 1.9% of the total at US$20.93 billion, mainly for software and information technology services, etc.

China’s OFDI stock in the production and supply of electricity, heat, gas and water amounted to US$15.66 billion, or 1.4% of the total. The investment was mainly in production and supply of electricity/heat.

China’s OFDI stock in scientific research and technical services accounted for 1.3% of the total at US$14.43 billion, mainly for special-purpose technical services, research, experiment and development.

China’s OFDI stock in life services, maintenance and other services accounted for 1.3% of the total at US$14.28 billion, mainly for other services and life services.

China’s OFDI stock in agriculture, forestry, animal husbandry and fishery amounted to US$11.48 billion, accounting for 1.0% of the total. Specifically, OFDI in agriculture accounted for 27%, that in forestry accounted for 21.9%, and that in fishery accounted for 9.9%.

China’s OFDI stock in the culture, sports and entertainment industries, USS3.25 billion, accounted for 0.3% of the total.

China’s OFDI stock in water, environment and public facilities management amounted to US$2.54 billion, accounting for 0.2% of the total.

China’s OFDI stock in the accommodation and catering industry amounted to US$2.23 billion, accounting for 0.2% of the total.

China’s OFDI stock in other industries amounted to US$460 million, accounting for 0.1% of the total (see Figures 1.21 and 1.22).

According to the regional distribution of stock in industries, China’s OFDI in industries in various regions is highly concentrated (see Table 1.19).

At the end of 2015, 75.2% of China’s OFDI stock was distributed in the tertiary industry (i.e., the services sector) with an amount of USS826.19 billion, mainly in business services, finance, wholesale and retail sales, transportation and warehousing, real estate, etc. Its OFDI stock in the secondary sector amounted to US$263.05 billion, or 24% of the total, including US$141.84 billion in mining (excluding ancillary mining activities), accounting for 53.9% of the OFDI stock in the secondary sector, US$78.43 billion in manufacturing (excluding metal products, machinery and equipment maintenance), accounting for 29.8%, US$27.12 billion in construction, accounting for 10.3%, and

China’s OFDI stock at the end of 2015, by industry (unit

Figure 1.21 China’s OFDI stock at the end of 2015, by industry (unit: US$100 million).

Table 1.19 Top five industries receiving China's OFDI on each continent at the end of 2015

Continent

Industry

Stock (USS 100 million)

Share (%)

Asia

Leasing and business services

3,313.1

43.1

Finance

1,030.9

13.4

Wholesale and retail sales

1,004.3

13.1

Mining

714.6

9.3

Manufacturing

407.1

5.3

Subtotal

6,470.0

84.2

Africa

Mining

95.4

27.5

Construction

95.1

27.4

Manufacturing

46.3

13.3

Finance

34.2

9.9

Scientific research and technical services

14.6

4.2

Subtotal

285.6

82.3

Europe

Mining

241.8

28.9

Manufacturing

160.8

19.2

Finance

153.4

18.3

Leasing and business services

80.0

9.6

Wholesale and retail sales

58.6

7.0

Subtotal

694.6

83.0

Latin

America

Leasing and business services

602.5

47.7

Finance

230.7

18.3

Mining

121.5

9.6

Wholesale and retail sales

96.2

7.6

Transportation, warehousing and postal services

45.5

3.6

Subtotal

1,096.4

86.8

North

America

Manufacturing

121.9

23.4

Finance

121.7

23.3

Leasing and business services

65.7

12.6

Mining

64.8

12.4

Real estate

37.6

7.2

Subtotal

411.7

78.9

Oceania

Mining

185.7

57.9

Real estate

29.9

9.3

Finance

25.6

8.0

Leasing and business services

23.4

7.3

Manufacturing

13.3

4.1

Subtotal

277.9

86.6

USS15.66 billion in power, heat, gas and water production and supply, 6%. China’s OFDI stock in the primaty sector (agriculture, forestry, animal husbandry and fishery, excluding related services) was US$8.62 billion, accounting for 0.8% of China’s OFDI stock.

4) STATE-OWNED AND NON-STATE-OWNED ENTERPRISES

HAD EQUAL SHARES

At the end of 2015, in terms of the nature of investing entities, in the US$938.2 billion of the OFDI in non-financial sectors, state-owned enterprises (SOEs) contributed 50.4% while non-state-owned enterprises contributed 49.6%, an increase of 3.2 percentage points over the previous year. A total of 32.2% were contributed by limited liability companies, 8.7% by companies limited by shares, 2.1% by private enterprises, 1.7% by joint-stock companies, 1.5% by foreign-invested enterprises, 0.4% by enterprises with investment from the Hong Kong SAR, the Macao SAR or Taiwan of China, 0.3% by collective enterprises, and 2.7% by other types of enterprises (see Figures 1.23 and 1.24).

5) SUBNATIONAL INVESTMENT GREW IN SHARE WITH

NEARLY 80% FROM EAST CHINA

The proportion of subnational investment increased year by year. At the end of 2015, the stock of non-financial foreign direct investment at subnational levels reached US$344.48 billion, accounting for 36.7% of the national non-financial outward investment stock, 5.1 percentage points higher from 2014. Specifically, East China contributed US$286.54 billion, accounting for 83.2%, West China contributed US$32.01 billion, accounting for 9.3%, and Central China contributed US$25.93 billion, accounting for 7.5%. Guangdong contributed the largest OFDI stock, and the second was Shanghai, followed in order by Beijing, Shandong, Jiangsu, Zhejiang, Liaoning, Tianjin, Fujian and Hunan (see Figure 1.25 and Table 1.20).

Share of state-owned and non-state-owned enterprises in China’s OFDI stock, 2006-2015

Figure 1.24 Share of state-owned and non-state-owned enterprises in China’s OFDI stock, 2006-2015.

Contribution of regions to China’s subnational OFDI stock at the end of 2015

Figure 1.25 Contribution of regions to China’s subnational OFDI stock at the end of 2015.

 
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