14-10-2016, 04:07 PM
1459072784-ChinaOutlook2015.pdf (Size: 2.76 MB / Downloads: 4)
Foreword
Thanks in part to economic stimulus and
adjustment measures from the Chinese
Government, the National Bureau of Statistics of
China reported that China’s economy grew by
7.4 percent in 2014, close to the government’s
target of 7.5 percent. By any standard, this is a very
strong result – but at the same time, it shows that
as China’s economy matures, it is unlikely to attain
double-digit gross domestic product (GDP) growth:
slower GDP growth is now the ‘new normal’.
In 2014, Chinese outward direct investment
(ODI) entered a new stage, with more Chinese
companies investing in more industries in more
countries. According to the Ministry of Commerce
of the People’s Republic of China (MOFCOM),
non-financial ODI in 2014 reached US$102.9 billion,
an annual increase of 14.1 percent. To move up
the value chain, Chinese companies expanded
overseas investment in additional new sectors,
notably high technology, agribusiness and food,
real estate, manufacturing, and services, and
we saw increased investment activity into North
America, Europe and Australia.
MOFCOM statistics show that foreign direct
investment (FDI) into China also set a record in
2014, narrowly eclipsing the 2013 total. In fact,
for the full year 2014, China’s FDI increased to a
record US$119.6 billion, up by 1.7 percent yearon-year.
The big story was FDI growth in the
service sector which grew 7.8 percent in 2014,
whereas manufacturing FDI witnessed a doubledigit
decline, reflecting the extent to which China’s
economy has been ‘rebalancing’ towards the
service sector.
At the Central Economic Work Conference
held in Beijing in December 2014, the Chinese
Government laid out its agenda for the economy,
as well as for FDI and ODI. The government
emphasized stable economic growth policies and
a focus on raising people’s living standards. With
regard to outbound and inbound investment, the
conference discussed:
Measures to promote the efficiency and
quality of outbound investment
• The promotion of infrastructure investment
and construction along the ‘New Silk Road
Economic Belt’ and the ‘21st Century
Maritime Silk Road’
• The broadening of market access to the
service sector and further opening up of the
manufacturing sector to foreign investment.
Against this backdrop, this outlook report seeks
to highlight the major developments in China’s
macro-economy, ODI and FDI in 2014, and offers
a closer look at the industry sectors where we
identified emerging trends and opportunities.
This report from KPMG’s Global China Practice
(GCP) provides our outlook for 2015, including
these predictions:
• GDP growth is likely to slow down further in
2015, but not dramatically
• Having likely overtaken FDI in 2014, ODI
should see continued double-digit growth
in 2015, which will widen the gap further
• FDI is likely to remain at the 2014 level of
around US$120 billion.