China Overseas Investments

Published on July 1, 2016

China’s outward FDI grew by 13.3% in 2015, hitting a historical high of USD 139.5 billion; and China’s outbound investment is expected to grow by more than 10%, and maintain a sustainable high growth for the next five years, as shown in the report Going Out – the global dream of a manufacturing power – 2016 China Outbound Investment Outlook issued by EY on April 14, 2016.

Adhering to the basic state policy of opening up, China will better integrate the "bring in" and "go global" strategies, expand the areas of opening up, optimize its structure, raise its quality, and turn the open economy into one in which Chinese businesses and their foreign counterparts engage in a win-win cooperation.

The objectives of the overseas investment of Chinese capital have been shifting from acquiring basic production essentials into accessing advanced technology, brands and markets, and the current China’s overseas investments are focusing on the high end sectors, such as technology, media & telecommunications (TMT), auto & transportation, and financial services.

The Chinese government, with the Administrative Measures for Outbound Investment newly promulgated by the Ministry of Commerce on September 6, 2014, helped the companies and speeded up the overseas investments. However, some Chinese overseas investments are facing some difficulties and cannot acclimatize themselves to the new business environment because of the local economic environment, the local laws and the local employment conditions.

To be more and more global, engaging legal, financial, tax and other professionals of rich experience in overseas investments is necessary for a prudent enterprise going abroad.