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FDI to China and ASEAN Grows
A report written by economists at Singapore's Ministry of Trade and Industry said China's gains in foreign direct investment (FDI) has not been at the expense of the Association of Southeast Asian Nations (ASEAN).

The report released on Monday also said the Asian financial crisis in 1997 and 1998 was the real cause for the post-1997 sharp drop in FDI to ASEAN and the decline was not closely linked to China's increasing attractiveness as a FDI destination.

The perception that China is getting the lion's share of FDI in Asia has been based on the assumption that FDI flows to Asia is a zero-sum game - meaning that an increase in FDI to one country must be at the expense of another country - the report said.

It stated that data from the 1990s showed that this is not the case in China and ASEAN as both economies have experienced strong FDI growth from 1989 to 1997. During this time, FDI flows to China shot up from US$3.4 billion to US$44 billion while FDI to the ASEAN-5 - Indonesia, Malaysia, the Philippines, Singapore and Thailand - grew from US$7.6 billion to US$27 billion.

Similarly, ASEAN and China both experienced a drop in FDI during the Asian financial crisis and FDI to ASEAN and China grew in tandem again in 2001, the report said.

"In a nutshell, the trends and patterns of global FDI flows to the ASEAN-5 and China have not shown that the growth of FDI to China has been at the expense of the ASEAN-5," the report said.

(Xinhua News Agency November 20, 2002)

UNCTAD: China May Outstrip US as Largest FDI Recipient
China's Economy Sees Rapid Growth
FDI to Reach US$50 bn in 2002
China Listed as No. 1 in Attracting FDI
FDI, Exports, Forex All See Jump
More High Quality FDI Urged
Ministry of Foreign Trade and Economic Cooperation
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