Prudence urged in ODI in real estate and entertainment

Updated 2017-07-19 09:20:23 Global Times

Relevant government departments will continue to pay attention to the inclination of irrational overseas investment by Chinese companies in real estate, hotels, cinemas, entertainment and sports clubs, to ward off risks, an official of the nation's top economic planning agency said on Tuesday.

Yan Pengcheng, spokesman for the National Development and Reform Commission (NDRC), made the remark at a regular press conference on Tuesday when asked about China's drop in non-financial overseas direct investment (ODI) in the first half of 2017 and possible regulatory policy adjustments concerning overseas investment.

In the first six months of this year, China's ODI in nonfinancial sectors fell 45.8 percent year-on-year to .19 billion, according to data released by the Ministry of Commerce on Thursday.

Such a drop in overseas investment is caused by multiple reasons, Yan said, citing the relatively large base figure from the same period in 2016 and China's stable and improved economic growth in the first six months, as well as strengthened domestic investors' confidence that led to more capital staying in the country.

Increased uncertainties in the global environment, increased prudence from companies making investment decisions overseas, and tightened compliance reviews by regulators on overseas investment are also behind the drop in such investments, Yan said.

"We continue to support qualified domestic companies to invest abroad, especially investment in projects related to the Belt and Road initiative and international capacity cooperation," Yan said.

Yan urged relevant companies to exert prudence in business decision making as relevant departments will continue to watch irrational investment inclinations in the above mentioned sectors to guard off risks in overseas investment.

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