Foreign direct investment (FDI) into China fell 20.4% year-on-year to around CNY 98 billion in the first two months of 2025, marking the steepest decline for this period since 2009.
This followed a 27.1% drop in 2024, the most significant recorded decline since 2008. The ongoing decrease reflects weaker foreign confidence in major projects within China’s economy, impacted by concerns over a deflationary spiral and delayed government stimulus. Additionally, the lack of transparency in the financials of manufacturers and service providers has further unsettled foreign investors.
China's economic support boosts investment outlook
However, signs of government economic support and hints of loosening restrictions on the tech sector have improved sentiment, potentially leading to higher direct investments later in the year.
