That China should be one of the world's top magnets of foreign direct investment is no surprise, given the country's huge domestic market, sound infrastructure, capable workforce and ever-improving business environment.
But with the novel coronavirus pandemic raging around the world, dealing a devastating blow to the global economy, 2020 might have been among the most difficult times for capital seeking investment opportunities across borders. Economic activities were brought to a near-standstill in many countries due to strict restrictions imposed to contain the spread of the virus, which also heavily disrupted production and the global supply chains.
Yet despite this, foreign direct investment on the Chinese mainland soared 6.2 percent year-on-year to a record high of 999.98 billion yuan ($144.37 billion) last year, sustaining the momentum of 2019 when FDI increased 5.8 percent from a year earlier, according to the Ministry of Commerce on Wednesday.
That is an unmistakable vote of confidence in China's economy. Capital always knows what is the best place for it, and where will be a safe haven in troubled times, which is exactly what China is and what it provides. Thanks to its effective prevention and control measures, it was the first country to emerge from the pandemic and normalize its economic activities and social life. And because of that, China was the only major economy to register a positive growth last year — at 2.3 percent.
Yet more important are the unprecedented steps the country has taken to push ahead with higher-level opening-up, against the backdrop of growing de-globalization and protectionist sentiment as characterized by the "America first" policy of the United States. These include new pilot free trade zones, ever-shortening "negative lists" for foreign investors, as well as the new Foreign Investment Law that came into effect on the first day of 2020, guaranteeing a level playing field for foreign businesses.
The progress China has made in improving the domestic business environment and reducing barriers for foreign investors has been acknowledged globally, and has led to the signing of a number of free trade and investment deals between China and its major trade partners such as the Association of Southeast Asian Nations and the European Union last year. China's continuous reforms, as well as its industrial upgrading strategy focused on innovation and sustainable growth, will expand opportunities for foreign investors in the country.
The Centre for Economics and Business Research, a London-based think tank, forecast recently that China will overtake the US to become the world's biggest economy in 2028. To invest in China is to embrace the future.