Actual Foreign direct investment (FDI) and contractual capital from abroad for the first 10 months of this year reached US$46.44 billion and US$76.5 billion, respectively, up 20 percent and 35 percent from the same period in 2001, Chinese Foreign Trade Minister Shi Guangsheng said.

New trends have been on the advent that include an increase in the average amount of investment for each overseas-funded project, a shift of focus of overseas capital from general manufacturing to basic industries, infrastructure, and new and high-tech industries, and a growing inflow of investments from large multinationals, Shi told a press conference on the sidelines of the ongoing 16th National Congress of the Communist Party of China.

Over the 13 years, he said, actual overseas capital in China topped US$400 billion, accounting for 97 percent of the total since the country initiated reform and opening up policies in the late 1970s.

The average amount of capital for each overseas-funded project jumped to 2.65 million US dollars last year from 970,000 US dollars in 1989, he said, adding that more than 400 of the world's top 500 corporations have had operations in China.

An increasing number of overseas investors have entered such sectors as foreign trade, telecommunications, finance, and insurance, Shi added.

*** Pivotal role of foreign trade

Shi Guangsheng said that the proportion of exports in China's GDP had increased to 23 percent in 2001 from 11.8 percent in 1989, 5 percentage points more than the world average. Actual overseas capital accounted for 11 percent of all investments in fixed assets across the country in 2001, and industrial added value of the overseas-funded enterprises made up 24.6 percent of the nation's total, he said.

Foreign trade and economic cooperation, Shi said, has helped accelerate economic restructuring and increase economic efficiency in the country.

By cooperating with overseas firms or absorbing advanced technology and managerial expertise from abroad, he said, China has had traditional industries like textiles and home appliances upgraded, while fostering new and high-tech industries.

Shi said that exports and imports contributed 16 percent of China's tax revenues last year and more than 70 million people are engaged in foreign trade and economic cooperation.

The development of the sector has also helped improve China's balance of payments, pushing its foreign exchange reserves up to 258.6 billion US dollars by the end of September 2002 from 5.5 billion US dollars at the end of 1989, ranking second in the world, Shi added.

*** Go-Out strategy

China has achieved initial success in implementing its "go-out strategy", which encourages domestic enterprises to invest overseas, giving a push to the growth of export-oriented economy, said Shi Guangsheng.

"By the end of June this year, China had set up 6,758 enterprises overseas with a total investment of 13.2 billion dollars, of which 8.9 billion was Chinese capital," said Shi .

Meanwhile, the total business volume for China's overseas project contracting and labor cooperation projects had reached 97.2 billion dollars, with 475,000 Chinese working overseas in various service export projects at the end of June, a sharp increase of 432,000 compared with the figure at the end of 1989, he added.

The minister said that the areas in which China has made its overseas investment have expanded from trade, shipping and restaurant business to manufacturing and processing, resource exploitation, project contracting, agricultural cooperation and research and development.

The modes of overseas investment by Chinese enterprises, which in the past only opened some overseas representative offices, now vary from setting up plants to export China-made equipment and materials, trans-national acquisition and merger, overseas stock listing to establishing overseas research and development centers or industrial parks, Shi noted.

Chinese personnel sent to work overseas in service export projects used to be ordinary laborers and technicians, but now they include all kinds of professionals like hi-tech engineers and senior managerial staff, he added.

*** Five postive changes

The minister said that China's opening-up has witnessed the change from a limited opening-up in limited regions and fields to an all-round, multi-level and much broader opening-up, as well as from a policy-guided opening-up in an experimental manner to a system-guaranteed opening-up under a legal framework.

Meanwhile, China's market opening process has changed from a single-sided self-opening to a two-way opening between China and other WTO members, and China has now been able to take an active part in the setting of international economic and trade rules instead of having to accept these rules in a passive manner, Shi added.

The last change is that China can now adjust its economic and trade relations with other nations through both bilateral and multilateral discussion mechanisms, while in the past it could only rely on the bilateral mechanism for smoothing out disputes, said Shi.

"All these changes will exert a comprehensive and far-reaching impact on our country, provide new opportunities for the development of China's foreign trade and economic cooperation, and help blaze a new trail for China's participation in the economic globalization," said Shi.

China formally became a member of the WTO on December 11 last year. Shi said that in the past year the Chinese government comprehensively fulfilled its commitments with an "earnest and responsible" attitude.

China has sharply lowered its tariff level and removed various non-tariff barriers, and has also abolished or revised as many as some 2,300 laws and regulations related to foreign trade and economic cooperation to meet the WTO standards, he added.

"Generally speaking, the entry into the WTO has and is continuing to have a positive effect on China's economic development," said the minister. "We have achieved a smooth beginning."

(xinhua)

Jiang Zemin, in his report to the 16th National Congress of the Communist Party of China, said the Party's door is open to all positive factors of the society, including private entrepreneurs, foreign-invested firm employees, self-employed businessmen and freelance professionals, he also said that the Party should advance with the times. What's your opinion?