China's net overseas investment hit $21.16 billion in 2006, with an annual average growth rate of 60 percent over the past five years, according to a newly-issued government statistical gazette.

The gazette quoted an expert from the National Bureau of Statistics as saying that overseas investment by Chinese enterprises has developed from setting up offices and opening "window" branches only to building factories, purchasing and acquisition, equity swapping, listing on overseas stock markets, establishing strategic cooperation and other patterns.

A prominent feature of overseas investment is the increasing cases of purchasing and acquisition, which accounted for some 40 percent of total overseas investment in 2006.

Major acquisition cases include the acquisition of South African mines and British mining companies by China's Zijin Kuangye, Lenovo's acquisition of IBM's PC business, CITIC Group's acquisition of Kazakhstan oil fields, and China Mobile's acquisition of Pakistan telecommunications company, among others.

Feng He, a researcher with the Chinese Ministry of Commerce, said that major reasons behind these overseas acquisition are that domestic enterprises want to seek more developing room overseas; the state loosened its control on overseas investment; and some large enterprises see overseas mergers and acquisition as the best way to become internationalized.

Vice Minister of Commerce Wei Jianguo said that China will actively explore international acquisition and other investment patterns to acquire famous brands, advanced management experiences and marketing network, and will gradually foster its own international giant companies.

Assistant Minister of Commerce Chen Jian urged Chinese companies to increase their sense of social responsibility and actively redound upon the local society; actively develop localization and increase local employment; make efforts to cultivate talents to meet the needs of international development; and establish a risk control mechanism.