Foreign Direct Investment in China

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Foreign Direct Investment in China

1.0 Introduction

I found this article "Foreign direct investment: Companies rush in with the cash" on the financial times website ( published December 11, 2002 written by John Thornhill. The reason for choosing this article is my personal interest in the Chinese economy and its attractiveness to the foreign investors. Apart from the foreign direct investment this topic has also helped me in understanding the impact of Chinese economy on the global market.

China the land of giant panda has also become the land of numbers and achievments. Official figures shows that China's economy is the fourth largest in the world when measured by nominal GDP and is predicted to surpass Germany to take the third place in early 2008.

2.0 Summary

China has come a very long way in the past 25 years. China has grown at nearly 10 percent a year over the past 20 years. China's explosion on to the world investment, production and trade scene is the product of its size, growth and openness. This is leading to tremendous changes in the global economy.

China has become the second largest foreign direct investment recipient country in the world and the largest recipient among developing countries. Since 1978 the foreign direct investment has flooded into the country. In 2002 china became the first country for a very long time to attract more foreign direct investment in one year then the United States (bringing in US$53.2 billion while US$52.7 billion flowed into the United States).

Foreign direct investment has played a vital role in the transformation of the Chinese economy in China, with value contracted increasing from US$ 52.1 billion (1998) to US$ 115.1 billion (2003).

In geogra...

... middle of paper ...

...itten the full word Foreign direct investment and then in the brackets he has put the abbreviation (FDI).

The article also give snap shot of the foreign companies who misjudge the Chinese culture, competition, size the market, and some other factors, have been badly affected by investing in china.

The writer has given a name of the reference book in the article " The china dream" by Joe Studwell. He has also given an example of Dupont an American investor company in china to make the article easy to understand.

The weaknesses of the article is some generalization, difficult language, some business jargons like cost-competitiveness, state owned enterprises etc.

The main weakness in the article is, the author may use graphs or tables to elaborate facts and figures.

5.0 References
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