China and Hong Kong SAR Tops in FDI in East Asia
Excerpted from a press release for UNCTAD’s World Investment Report 2012 (references to China and related in bold):
In East Asia, FDI flows to China reached a historic high of $124 billion in 2011. The second largest recipient in the sub-region, Hong Kong (China), saw its inflows increase to $83 billion, also a record. In China, FDI flows to services surpassed those to manufacturing for the first time as the result of a rise in flows to non-financial services and a slowdown in flows to manufacturing. FDI in finance is also expected to grow as the country continues to open its financial markets and as foreign banks expand their presence through mergers and acquisitions (M&As) and through organic growth.
FDI outflows, after a significant increase in 2010, dropped 9 per cent from East Asia but recorded a 36 per cent rise from South-East Asia, the report says. Outgoing FDI from China declined by 5 per cent to $65 billion. FDI from Hong Kong (China), the region’s financial centre and largest source of FDI, declined in 2011 by 14 per cent to $82 billion.
M&A purchases worldwide amounted to $68 billion in 2011, slightly higher than the previous record set in 2010. The region’s cross-border M&A activities demonstrated diverging trends – total purchases in developed countries increased by 31 per cent to $46 billion, while those channeled to developing countries declined by 33 per cent to $22 billion. The rise in M&As from the region in developed countries as a whole was driven mainly by surges in Australia, Canada and the United States, while the value of total purchases in Europe decreased slightly.
The full UNCTAD report can be downloaded from: http://unctad.org/en/Pages/DIAE/World%20Investment%20Report/WIR2012_WebFlyer.aspx