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China now number-one destination for new foreign investment

China now number-one destination for new foreign investment

China is now the world’s top destination for new foreign direct investment, overtaking the US.

According to UN figures released at the end of March, investment into the US from overseas fell by almost 50% in 2020, leading to the loss of its number-one status. In contrast, direct investment into Chinese firms climbed 4%.

China attracted $163bn (£119bn) in investment last year, compared with $134bn for the US. In 2019, the US received $251bn in new foreign direct investment while China received $140bn.

Despite the fact that China is the number-one destination for new foreign investment, the US is still top for total foreign investments, the United Nations Conference on Trade and Development (UNCTAD) said in its report.

China’s gross domestic product grew 2.3% in 2020, official data showed in March, making it the only major economy in the world to avoid a contraction last year.

Overall, global foreign direct investment (FDI) dropped dramatically in 2020, falling by 42%, according to the UNCTAD report. FDI normally involves one company taking control of an overseas one, typically through a merger or acquisition.