January 14, 2016 / 8:41 AM / 4 years ago

Hi-tech, coffee and cabs help push China 2015 FDI up 6.4 percent despite economy woes

BEIJING (Reuters) - China attracted $126.3 billion, or 781.4 billion yuan, in non-financial foreign direct investment (FDI) in 2015, up 6.4 percent from 2014, despite its cooling economy.

With traditional heavy industries facing persistent weakness, foreign investors favored the more robust services sector and higher-value, hi-tech manufacturing last year, data from commerce ministry showed on Thursday.

The services sector has utilized $77.2 billion, or 477.1 billion yuan of foreign investment, up 17.3 percent from 2014.

United States ride-hailing firm Uber UBER.UL has committed to invest 6.3 billion yuan ($956.33 million) in China as it aims to break into its huge tourism industry with businesses ranging from transportation services to automotive financing.

The world’s largest coffee chain, Starbucks Corp (SBUX.O), said on Tuesday it aims to open 500 stores in China this year, its largest market outside of the U.S, and aims to create 10,000 jobs in China every year through 2019.

At present, investment from overseas companies contributes to half of all foreign trade in China, one-quarter of industrial output, one-seventh of urban employment and one-fifth of tax income, the ministry statement said.

While FDI is a key measure of general overseas investment interest in China, it is a small factor within overall capital flows and when compared to the huge export sector.

The ministry has yet to release December FDI figures and outbound investment figures, but according to Reuters calculations, China attracted $12.23 billion, or 77.02 billion yuan, in non-financial FDI in December.

High-tech manufacturing accounted for $9.41 billion, or 58.35 billion yuan, of foreign direct investment in 2015, up 9.5 percent from 2014 and accounting for 23.8 percent of investment in China’s manufacturing sector, according to the commerce ministry’s statement.

Almost no FDI was approved for industries suffering from overcapacity such as steel, cement and ship-building, the statement said.

Free trade zones in Guangdong, Tianjin and Fujian attracted investment of 445.81 billion yuan from 6,040 overseas companies between January and November 2015, according to the statement.

The government has encouraged firms recently to expand investment abroad to gain global competitiveness.

Reporting By Beijing Monitoring Desk and Sue-Lin Wong; Editing by Kim Coghill

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