Despite increasing global economic uncertainty, China’s dedication to reform and opening-up remains a strong pull for foreign investors. In the first quarter of 2025, newly established foreign-invested enterprises rose by 4.3 percent compared to the previous year, reaching a total of 12,603, according to the Ministry of Commerce.
Though foreign direct investment (FDI) inflows fell to 269.23 billion yuan ($37.2 billion) in the first quarter, the rate of decline slowed notably, with March seeing a significant 13.2 percent year-on-year rebound in FDI.
China’s emphasis on high-tech and innovation-driven sectors continues to attract foreign investment. In the first quarter, investment in e-commerce services surged by 100.5 percent, while biopharmaceuticals and aerospace equipment saw increases of 63.8 percent and 42.5 percent, respectively.
The sources of FDI are also diversifying, with investments from ASEAN countries up 56.2 percent, EU inflows rising by 11.7 percent, and investments from Switzerland and the UK surging by over 60 percent, including those channeled through free ports.
A survey by the American Chamber of Commerce in South China found that 58 percent of foreign companies still regard China as one of their top three global investment destinations, indicating continued confidence in the market’s resilience.
Foreign companies are also increasing their research and development investments in China. Firms like Sanofi, AstraZeneca, and Valeo are expanding their innovation hubs, citing the country’s stable policy environment, high returns, and vibrant innovation ecosystem, according to the CMG report.
In response, China is further opening key service sectors. Global firms, including Siemens, have been approved for telecommunication trials, while the Ministry of Commerce has introduced 155 new measures to increase access to sectors like healthcare, tourism, and cross-border e-commerce.
The government is also simplifying market access by reducing the national negative list to just 29 items.
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