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FDI Dips in First Five Months
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Foreign direct investment (FDI) in China dropped slightly in the first five months of the year, but within a reasonable fluctuation.

China attracted US$22.4 billion of FDI over the period, a 0.79 percent decrease from the previous year, according to statistics published by the Ministry of Commerce (MOFCOM).

Contracted direct investment to China, which indicates the future trend of FDI flow, rose nearly 15 percent over last year to US$65 billion.

The ministry said China approved 16,437 new foreign-invested ventures between January and May, down 4.75 percent from last year.

Based on official information, the country realized FDI of US$4.89 billion in May, a comparatively large decrease of some 22 percent over last year.

Although all the figures for the period show a declining or slowing growth rate, experts said average investment per project was increasing.

"I would like to attribute the slowdown to the large amount of FDI last year," said Lu Jinyong, an investment researcher with the University of International Business and Economics (UIBE) in Beijing.

In 2004, China, one of the fastest-growing economies in the world, attracted actual FDI of more than US$60.6 billion, up 13 percent from the previous year.

"It is really difficult for China to maintain a high growth rate after such a high starting point," Lu said.

(China Daily June 13, 2005)

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