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Recent Developments in Foreign Direct Investment in China


  • Chen Chunlai


Since 1993 China has become the second largest FDI recipient in the world and the single largest host country among the developing countries. This paper finds that the regional distribution of FDI inflows into China has been very uneven and mainly concentrated in the East region. Among the economic sectors, industry and real estate sectors are the major FDI recipients. FDI inflows into China are mainly concentrated in labour intensive manufacturing industries, which reveals that taking advantage of ChinaÂ’s cheap labour is the main motive for foreign investors in China. FDI inflows into China have been dominated by NIEs, especially by Hong Kong. This paper discusses several factors for the domination of NIEsÂ’ investments in China and reviews the recent policy and regulation changes towards FDI.

Suggested Citation

  • Chen Chunlai, 1996. "Recent Developments in Foreign Direct Investment in China," Chinese Economies Research Centre (CERC) Working Papers 1996-03, University of Adelaide, Chinese Economies Research Centre.
  • Handle: RePEc:adl:cercwp:1996-03

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    Cited by:

    1. Stèphane Dees, 1998. "Foreign Direct Investment in China: Determinants and Effects," Economic Change and Restructuring, Springer, vol. 31(2), pages 175-194, May.
    2. Bijit Bora & Chen Chunlai, 1997. "The Internationalisation of China and Its Implications for Australia," Chinese Economies Research Centre (CERC) Working Papers 1997-05, University of Adelaide, Chinese Economies Research Centre.
    3. Elissa Braunstein & Mark Brenner, 2007. "Foreign direct investment and gendered wages in urban China," Feminist Economics, Taylor & Francis Journals, vol. 13(3-4), pages 213-237.
    4. Nada Massoud, 2003. "Assessment of FDI Incentives in Egypt," Working Papers 0336, Economic Research Forum, revised 11 2003.
    5. Cletus C. Coughlin & Eran Segev, 2000. "Foreign Direct Investment in China: A Spatial Econometric Study," The World Economy, Wiley Blackwell, vol. 23(1), pages 1-23, January.
    6. Chao Yang Peng, 1996. "Challenges to China's Energy Security," Chinese Economies Research Centre (CERC) Working Papers 1996-08, University of Adelaide, Chinese Economies Research Centre.
    7. Jianhong Zhang, 2005. "An explanatory study of bilateral FDI relations: The case of China," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 3(2), pages 133-150.

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