Belt and Road Initiative sparks big surge in FDI

Foreign direct investment in China's agriculture and forestry sectors by investors from countries along the Belt and Road Initiative surged 2,171 percent and 1,137 percent year-on-year, respectively, in August, the Ministry of Commerce said on Thursday.

FDI from the nations and regions into China's animal husbandry and fishery industries also rose 127 percent and 103 percent, respectively, officials said, indicating China's huge demand for products such as grain, vegetables, high-protein food and aquatic products remains attractive to international investors.

The initiative, proposed by China in 2013, is a trade and infrastructure network that includes the Silk Road Economic Belt and the 21st Century Maritime Silk Road.

The planned network connects Asia, Europe and Africa and passes through more than 60 countries and regions.

Zhao Ying, a researcher at the Institute of Industrial Economics under the Chinese Academy of Social Sciences, said food consumption is a strong indicator of economic stability. China's food consumption is rising, the types of food are diversifying, and food is becoming more sophisticated, said Zhao.

"The most obvious change is in the modernization of livestock and grain farming, and in the food supply chain.

"Those are big areas where lots of foreign investment is being made.

"Demand for processed food, such as canned goods for cooking and for restaurants, has also been growing fast," said Zhao.

Shen Danyang, the ministry's spokesman, said the Belt and Road Initiative will prove a flexible platform for both inbound investment by foreign firms and outbound investment by Chinese companies.

"The initiative will go a long way in boosting investment, trade and commerce between the regions, against the context of a softening global economy," said Shen.

Singapore, Saudi Arabia, Indonesia, Brunei and Malaysia were the top five investors into China among Belt and Road countries in August.

Official data show that FDI into China dropped 14 percent during the month from a year earlier, totaling $7.2 billion, but Belt and Road countries set up 244 companies in China during August, a 54.4 percent rise on last year.

Shen said the growth of China's outsourced services cooperation with partners along the Belt and Road is now faster than with other regions, worth $9.3 billion between January and August in terms of contract value.

The value of the outsourcing contracts undertaken from the Southeast Asian countries alone was worth $5.38 billion in the first eight months of the year, up 34 percent year-on-year.

Shen expected China to continue to deepen its outsourcing cooperation along both the Belt and Road trading routes in the long term.