North American FDI into China continues to fall

Greenfield investment monitor fDi Markets has recorded a year-on-year decline of FDI from North America into China between 2013 and 2016.

China is consistently the most popular destination in the Asia-Pacific region for receiving North American investment. It accounted for 23.73% of capital investment in the 2013 to 2016 period from US and Canadian businesses. Further, China is North America’s second most popular destination for foreign investment projects globally, behind only the UK, and has received the most capital investment (9.18% of North America’s total outward capital investment).

During 2013, 343 investment projects from North America into China were recorded. This figure has subsequently declined year-on-year, with 2016 recording 213 projects, a fall of 37.9% on 2013. The US was the biggest source country in North America for China’s inward investment, accounting for 92.71% of the projects in the period. Between 2013 and 2016, US projects into China fell from 321 to 196 (38.94%).

Jobs created in China as a result of North American investment has also declined during this period. In this case, 86,811 jobs were created during 2013. This has subsequently decreased year-on-year with 2016 recording a value that was 55.19% lower than that recorded in 2013.

Capital investment showed a recovery in 2016. Between 2013 and 2015, the fDI Markets monitor recorded a year-on-year decrease. However, in 2016 capital investment from North American companies into China rose to $12.92bn, an increase of 20.06% on 2015 figures.

The US accounted for 18.65% of global capital investment into China between 2013 and 2016, making it the top source country. US-based Apple was the most frequent investor during the period, with 22 projects coming from the technology giant. However, Starwood Hotels & Resorts, a Connecticut-based hotel and leisure company, was the most capital-intensive investor. In 2013 alone, it invested more than $3bn into its China operations.