Foreign direct investment plunged 87 percent from April through June, compared with the same months last year, according to Nomura, a Japanese bank. That is the lowest quarterly level since modern records began in early 1998…
DB2
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And it has now turned negative.
The shift was reflected in balance-of-payments data for the July-September quarter released Friday by the State Administration of Foreign Exchange. FDI came to minus $11.8 billion, with more withdrawals and downsizing than new investments for factory construction and other purposes. This marked the first negative figure in data going back to 1998…
Looking at foreign investment in the semiconductor field by destination, China’s share has already shrunk from 48% in 2018 to 1% in 2022, according to U.S. research firm Rhodium Group. In contrast, the U.S. share rose from zero to 37%. The combined share of India, Singapore and Malaysia grew from 10% to 38%.
DB2
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How does China overtake America without foreign investment? With capital flight?
The Captain
does not worry about China, just a repeat of Japan not taking over the world.
Curious factoid, when Japan bought Pebble Beach and Rockefeller Center they remained in California and New York respectively. The Japanese just sending cash back to America.
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And for all of 2023…
China’s direct investment liabilities in its balance of payments stood at $33 billion last year, according to data from the State Administration of Foreign Exchange released Sunday. That measure of new foreign investment into the country — which records monetary flows connected to foreign-owned entities in China — was 82% lower than the 2022 level and the lowest since 1993.
DB2
Like I said a year or so ago, China is not investable anymore. For a few reasons, primarily because Xi is shifting away from their style of capitalism back towards something else (not exactly communism, but some weird amalgam). Secondarily, because any investment that “hits it big” will have most of the gains taken before you can see them. That’s because there is a desperate need for capital by all levels of government in China, and that’s only going to get worse as the people age. Demographic problems in countries like China can’t be solved quickly.
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It is our capital coming our way and Mexico’s. As the cycle progresses Japan and the UK will get some of the capital.