Foreign Correspondence

[Amaunet]

Foreign Investment in U.S. plunges 53 per cent


China gets more foreign investment than US

GENEVA - China has again overtaken the United States as a top global destination for foreign direct investment (FDI) last year, a UN report said yesterday.p> China had replaced the US as the world's largest FDI recipient in 2002 for the first time.

China's strong manufacturing industry helped the country attract FDI worth US$53.5 billion (S$91 billion) last year, compared with US$52.7 billion in 2002, the United Nations Conference on Trade and Development (Unctad) said in its annual report on investment flows.

In comparison, foreign investment in the US, traditionally the largest recipient of such money, plunged by 53 per cent last year to reach US$30 billion dollars - the lowest level in 12 years.

According to data from Unctad's World Investment Report 2004, the Asia-Pacific region attracted more investment than any other developing region.

Flows to the Asia-Pacific region as a whole rebounded over the year to US$107 billion from US$94 billion in 2002, driven by strong economic growth and a better investment environment, the agency said.

China is expected to continue to attract foreign companies, analysts said.

'According to our analysis, FDI in China has not peaked, although the economic growth rates have fallen,' Unctad economist James Zhan told journalists.

The Sars outbreak had only a marginal downward effect on investment activity as Asia emerged from the decline in foreign investment it had experienced since 2001, the report said.

Asian companies were also growing in power and reach as investors in other regions, according to the Geneva-based agency.

Asian companies, 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

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