By almost all accounts, foreign direct investment (FDI) in China has been one of the major success stories for many years. China has become the leader among all developing nations and its economy has grown to a world leading status.
China’s FDI consists largely of greenfield investment, compared to FDI in other countries that has been generated mainly by takeover of existing enterprises than by new establishment of new companies. The majority of FDI in China has its origin from elsewhere in developing Asia (i.e., not including Japan).
Hong Kong has been one of the largest source of record. The dominance of Hong Kong is due to foreign companies investing over Hong Kong in China or domestic Chinese that is “round-tripped” through Hong Kong. See more insights on the following pages of SMATRA’s market expertise.