Posted on 09/22/2004 10:35:07 PM PDT by Destro
Time is GMT + 8 hours Posted: 23 September 2004 0213 hrs
China overtakes United States as top destination for foreign investment
GENEVA : China overtook the United States as a top global destination for foreign direct investment (FDI) in 2003 while the Asia-Pacific region attracted more investment than any other developing region, a UN report said.
China's strong manufacturing industry helped the country attract FDI last year worth 53.5 billion dollars, compared with 52.7 billion in 2002, the United Nations Conference on Trade and Development (UNCTAD) said in its annual report on investment flows.
Meanwhile, foreign investment in the United States, traditionally the largest recipient of such money, plunged by 53 percent last year to reach 30 billion dollars, the lowest level in 12 years, according to data from UNCTAD's World Investment Report 2004.
Flows to the Asia-Pacific region as a whole rebounded over the year to 107 billion dollars from 94 billion in 2002 driven by strong economic growth and a better investment environment, the agency said.
China was expected to continue to attract foreign companies, analysts said.
"According to our analysis, FDI in China has not peaked although their economic growth rates have fallen," UNCTAD economist James Zhan told journalists.
The outbreak of deadly Severe Acute Respiratory Disease (SARS) only had a marginal downward effect on investment activity as Asia emerged from the decline in foreign investment it had experienced since 2001, the report noted.
"Prospects for a further rise in foreign direct investment flows to Asia and the Pacific in 2004 are promising," UNCTAD's Deputy Secretary General, Carlos Fortin, said in a statement.
But the distribution of the new wealth was uneven across the region, with most of the money -- 72 billion dollars -- concentrated in north-east Asia.
Flows to south-east Asia rose 27 percent to 19 billion dollars, while the south merely received six billion dollars in FDI.
Resource-rich central Asia recorded 6.1 billion and 4.1 billion dollars flowed into the west.
The manufacturing sector remained the dominant factor that pulled investment into China, but a rise in investment in the services industry was noted elsewhere in line with the global trend, UNCTAD said.
Services, including finance, tourism, telecommunications and information technology, formed a growing proportion of foreign direct investment stock in the region -- up to 50 percent in 2002, the most recent figure available, from 43 percent in 1995, UNCTAD said.
UNCTAD said the growing tendency to shift some business activities overseas to places where labour costs are low but the workforce is skilled helped to raise the region's profile.
Asian companies were also growing in power and reach as investors in other regions, according to the Geneva-based agency.
China and India were joining Malaysia, South Korea, Singapore and Taiwan as sources of foreign direct investment, it said.
Asian firms, such as Hutchinson Whampoa of Hong Kong, Singapore's Singtel and Samsung of South Korea, again dominate the UNCTAD list of the top companies from the developing world.
- AFP
The bottom line is this: so what if we've had a three year dip in median income (especially given the circumstances), even this data - taken back to '67 - is skewed so that the adjustment for inflation isn't entirely accurate and expresses the wage levels too conservatively!
CPI has always overstated inflation due to quality improvement.
Especially when it comes to IT.
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