China's overseas investment slows down in December

China's outbound direct investment (ODI) is expected to expand at a slower pace in December, analysts said over the weekend, withdrawing previous forecasts that the country was going to become a net capital exporter in 2014.

Compared with a rapid growth in China's ODI in the middle of 2014, there were few big overseas investment projects in December, signifying a slower expansion of China's ODI, Wu Pin, deputy head of the Policy Research Office with the Ministry of Commerce (MOC), said at a forum hosted by the Global People magazine in Beijing on Friday.

Figures about China's ODI for December will be officially unveiled by the MOC in late January. According to the latest data, the country's ODI fell 26.1 percent year-on-year to $7.9 billion in November, following a 17.8 percent year-on-year increase in the first 10 months.

After a rapid increase in the ODI driven by several large-scale overseas projects, the declines of the past few months are normal, Wang Yongzhong, a research fellow with the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, told the Global Times on Sunday.

In addition, Chinese firms in several sectors such as energy are taking a wait-and-see attitude with regard to outbound mergers and acquisitions due to the recent fluctuations in the prices of commodities such as crude oil, Wang noted.

The recent drop in the figure means the country's ODI may not surpass its actualized foreign direct investment (FDI), and China may not become a net capital exporter by 2014, Wu said at the forum.

The previous view that China is expected to become a net capital exporter in 2014 is not very likely to materialize, Wu said, noting that growth of China's ODI will be consistent with the increase in FDI for a period of time and the country will see a balance in its cross-border capital flows.

Foreign capital is an important pillar of China's economic growth and the country still remains a favored investment destination for FDI, Wang said.