OREANDA-NEWS. July 20, 2012. China attracted 12 billion U.S. dollars in foreign direct investment (FDI) in June, 6.9 percent less than a year earlier, the Ministry of Commerce (MOC) announced.
 
The figure took the country's first-half FDI inflow to 59.1 billion U.S. dollars, down 3 percent year on year, MOC spokesman Shen Danyang said at a press conference.
 
Global investment remains inactive in 2012 because of a lackluster world economy, explained the spokesman.
 
According to the "World Investment Report 2012" by the United Nations Conference on Trade and Development, global FDI is expected to increase at a slower rate in 2012 due to stalling global economic growth, to 1.6 trillion dollars.
 
The MOC data showed investment from the debt-ridden European Union (EU) rebounded one percent in the first half from a year ago, Shen said.
 
From January to May, investment from the EU declined 5.1 percent, according to the MOC data.
 
On the other hand, rising costs and tightening land supplies in China have also shaken investors' confidence, Shen said.
 
Data showed that in the first six months, FDI into the property sector dropped 12.4 percent from a year earlier, a much heavier decline compared to other sectors.
 
Excluding the property sector, FDI in the country slipped just 0.1 percent year on year in the first half, he said, adding that investment in other service sectors rose 6.6 percent year on year.
 
"China's economy will hopefully pick up momentum in the second half of the year. It will boost investors' confidence," the spokesman said.
 
Speaking during an inspection tour of southwest China's Sichuan province from Friday to Sunday, Chinese Premier Wen Jiabao warned that the country's economy has not yet stabilized after a rebound, and that economic hardship may continue for some time, calling for greater efforts to further economic growth.
 
China's economy expanded 7.6 percent year on year in the second quarter of 2012, marking the sixth consecutive quarter of slowing down and the lowest growth rate since the third quarter of 2009, the National Bureau of Statistics said on Friday.
 
Nevertheless, China still tops the list of most popular investment destinations in the "World Investment Report 2012."
 
Shen attributed the country's attractiveness to its fast-growing consumption market, intensified crackdowns on intellectual property rights (IPRs) violations, and the ongoing process of industrialization and urbanization.
 
He said authorities are working to further improve the country's investment credentials in order to absorb more foreign investment into sectors that are promoted by the government.
 
"We will step up amending the catalogue for the guidance of foreign investment in central and western regions," he said, also pledging more efforts to protect IPRs.
 
The MOC data showed that a total of 2,444 new companies were founded with foreign capital in June, down 16.3 percent year on year.
 
During the first six months, 11,705 new companies were set up, 13.1 percent fewer than in the same period last year.