China Commerce Ministry: China strongly dissatisfied, firmly opposes

China Commerce Ministry: China strongly dissatisfied, firmly opposes

In the first half of 2025, China's documented global investment has shown a notable decline, with spending particularly low in April and May. This slowdown is attributed to the global threat posed by US tariffs [1]. The leading recipient of Chinese investment during this period was Indonesia, with the metals sector being the primary focus. Meanwhile, construction activities emphasized energy projects, with Saudi Arabia remaining the top location [1].

The Chinese Ministry of Commerce (MOFCOM) is expected to report an all-time high for annual investment, despite the current slowdown. This potential boom requires significant effort to be noticed, as the ministry's figures suggest that COVID-19 and zero-COVID restrictions have led to vaguer disclosures from Chinese enterprises [1]. While investment rebounded from the pandemic in 2023, construction activity rebounded in 2024, with construction spending now eclipsing investment in value for the first time this year [1].

The CGIT, the most comprehensive public record of China's investment and construction globally, shows a 16% decline in investment in the first half of 2025, following a 4% increase in 2024. This weakness is likely temporary, as the pause in April and May is likely due to global uncertainty caused by US tariff policy [1]. The CGIT's data indicates that the UK and Hungary were the leading recipients of Chinese investment in 2024, while Indonesia and Brazil are leading in the first half of 2025. The transport sector was the top recipient in 2024, while metals led in the first half of 2025 [1].

The CGIT's data also shows that China's construction activity has rebounded, with Saudi Arabia leading in 2024 and early 2025, and energy being the dominant sector. The Belt and Road Initiative (BRI) continues to dominate China's global construction activities, with $667 billion built and $452 billion invested since its inception in late 2013 [1].

China's total investment in the US from 2020 through the middle of 2025 is $13 billion, after exceeding that each year from 2013 through 2017. Despite the focus on farmland purchases, China is not buying much of anything in the US, as the US is blocking inbound acquisition of domestic resources and technology [1].

The CGIT and MOFCOM's data on Chinese outbound investment differ significantly, with the CGIT's data being more comprehensive and transparent. However, both sources have their limitations, such as the CGIT's $95 million minimum transaction size and the MOFCOM's lack of transparency and reliance on offshore financial centers for reporting [1].

In conclusion, China's outbound investment and construction activities have shown mixed results in the first half of 2025, with a notable decline in investment and a rebound in construction. The CGIT's data provides a more comprehensive picture of China's global activities, but both sources have their limitations. The US remains a significant focus for Chinese investment, despite the country's efforts to block inbound acquisitions.

References:

[1] https://www.aei.org/research-products/report/the-tariff-hiccup-slows-chinas-outbound-investment-but-construction-gains/