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China will provide more investment opportunities to the outside and is likely to see the fastest growth in foreign investment in the world, according to predictions by multinational corporations.
"China is the most active and attractive market in the world, and it will lure more and more foreign investment," said Kurt Hellstrom, president and CEO of the Ericsson Group.
Hellstrom is one of the more than 20 presidents and CEOs of renowned multinational corporations, all advisors to the Beijing city mayor, who are in the Chinese capital attending the on-going fourth China Beijing International Week for Hi-tech Industries.
"China is expected to become the most important investment market of Ericsson this year," said Jan Malm, president of Ericsson (China) Company Ltd. He is very optimistic about his business in China.
According to its five-year plan for development in China, Ericsson, the world's biggest mobile telecommunications network provider, will increase its investment in China to US$5.1 billion from the current US$2.4 billion.
A survey released recently by the American Chamber of Commerce in China shows that 91 percent of the 160 surveyed US enterprises which have invested in China are optimistic about their business in the country in the coming five years, and 85 percent of them plan to make additional investment.
A research report published in "The Economist" magazine forecast that in the next five years, China will absorb US$57.6 billion in foreign direct investment on a yearly basis, accounting for 6.5 percent of the global total.
Economists have noted that the Chinese economy is maintaining a strong growth trend while the global economy slows down. According to the World Bank prediction, China's economic growth rate is expected to reach 7.3 percent before its accession to the World Trade Organization (WTO).
"From a long-term point of view, the economies in other regions will weaken, however foreign investment to China is likely to increase at the rapidest speed," said Chao Y.Wang, Chairman and CEO of the ChinaEquity Investment Co., Ltd.
Wang was engaged in international real estate fund-raising for many years and was formerly vice president of Morgan Stanley Asia Limited.
Wang said consecutive years of rapid growth in gross domestic product, a huge consumer market with great potential, low inflation, high-quality human resources, preferential policies for introducing foreign funds and a stable Renminbi exchange rate are the advantages that attract foreign investors to China.
Statistics from the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) show that foreign investment to China totaled US$40.7 billion in 2000, nearly one percent more than the previous year.
In the first quarter this year, the contractual and used volume of foreign investment was 40 percent and 10 percent higher than the corresponding period of last year, reaching US$16 billion and US$7.98 billion, respectively.
Yu Weixiang, a research fellow with MOFTEC, said that use of foreign funds has become an important force behind China's economic growth, and China will continue its efforts to attract more foreign investment in the new century.
Chinese leaders have committed that following the country's accession to the WTO, China will gradually expand the opening of trade of commodities and trade in the service sector to provide more market access chances for foreign enterprises which intend to invest in China.
ABB president and CEO Jorgen Centerman firmly believes this. "This will provide us with new business opportunities and will guarantee a very high growth in foreign investment to China,".
(China Daily 05/14/2001)
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