China’s only investment event--the CIFIT--is expected to play a more important part in transnational investment and cooperation
The opening of an annual investment event, the China International Fair for Investment and Trade (CIFIT), held in Xiamen on September 8, is drawing near and this year marks the 10th anniversary of the fair. Considering that topics include, “introducing foreign direct investment (FDI)” and “going global,” this year’s fair will see more high-profile foreign guests, hold more diversified forums or symposiums, according to Liu Yajun, Director of the Investment Promotion Agency under the Ministry of Commerce (MOFCOM).
The CIFIT is China’s sole nationwide international investment promotion event, which is sponsored by MOFCOM in association with the United Nations Conference on Trade and Development (UNCTAD), the United Nations Industrial Development Organization (UNIDO), the Organization for Economic Cooperation and Development (OECD), the International Finance Corp. (IFC) and the World Association of Investment Promotion Agencies (WAIPA).
“For a decade, the CIFIT has played an important role in facilitating the implementation of our country’s overall development strategy of absorbing FDI and encouraging outward direct investment,” emphasized Liu. “It’s considered as a window for international capital to flow into China and a bridge for Chinese enterprises’ worldwide investment.”
On one hand, continued Liu, by presenting the investment environment and policies of all the 31 provinces, autonomous regions and municipalities, the CIFIT provides opportunities for foreign investors to get overall information about China. On the other hand, the CIFIT has become a platform where more and more foreign countries and regions promote their investment environment and relevant policies, making the CIFIT an important channel for domestic enterprises aiming at investing abroad.
According to Liu, agreements were signed for 1,053 foreign-invested projects, with contractual foreign investment of $12.2 billion. There were also 52 projects involving China’s outward investment valued at $420 million. As of the ninth session of the CIFIT, agreements were reached for 11,363 investment projects, with contractual foreign investment outstripping $60 billion.
Highlights
CIFIT’s “going global” theme is slated to be the biggest highlight this year.
“We should further encourage qualified Chinese enterprises to ‘go global’, and strengthen our efforts in investing abroad,” said Ma Xiuhong, Vice Minister of MOFCOM, at the second preparatory meeting for the 10th CIFIT. Statistics show China has absorbed more than $600 billion of foreign investment thus far, while its total outward investment is only valued at about $50 billion.
At this year’s CIFIT, more countries or regions will hold investment introduction symposiums, where qualified Chinese enterprises can get useful information and get in touch with governments or investment promotion agencies of target countries or regions.
For example, Ma said, a symposium on the introduction of the African investment environment, scheduled for this year, will be an important event. Chinese enterprises have made a lot of investment in Africa and have performed well there. This introduction can help other enterprises know more about Africa and encourage more Chinese investors to start up businesses on the continent.
There will be another symposium on promoting Russia’s special economic zones, Ma said, as 2006 is the Year of Russia in China. Both Chinese and Russian Governments are enthusiastic in encouraging Chinese enterprises to invest in Russia.
Ma also pointed out that China is facilitating domestic enterprise investment in Mexico, taking full advantage of Mexico as a member of the North American Free Trade Agreement. An investment promotion seminar for Mexico will also be held at this year’s fair. In addition, several states from the United States, including Illinois, Ohio, South Carolina, Minnesota and Michigan will send their delegations to the fair. Illinois will also hold an investment introduction meeting.
Another feature of the CIFIT is its matchmaking symposium for investment projects, initiated in 2003 at the seventh session. At the matchmaking symposiums, project developers and potential investors can negotiate face-to-face. According to Zhao Chuang, Deputy Director of MOFCOM’s Department of Foreign Economic Cooperation, 107 Chinese enterprises participated in the matchmaking symposium in 2003, and the number grew to 156 in 2004 and 179 in 2005. Target investment markets also increased year by year, with 73 in 2003, 85 in 2004 and 97 in 2005.
This year, project developers and potential investors from any foreign country or region can look for potential partners regardless of whether they are Chinese. Thus the matchmaking symposium will provide a platform for business negotiations among foreign countries and regions.
Statistics from CIFIT’s organizing committee show that, so far, they have received requests to attend the matchmaking symposium from more than 23,000 domestic projects and 1,200 overseas projects, covering such sectors as agriculture, services, infrastructure and machinery.
CIFIT also pays special attention to cross-strait economic and trade exchanges, as the host city Xiamen, lying on the west side of the Taiwan Strait, has a strong link with Taiwan. “Each of the past sessions has attracted thousands of business people from Taiwan, which numbered the most among overseas business guests,” said Liu Yajun. “Last year, there were 77 industrial and commercial groups coming from Taiwan, and the number of Taiwan business people reached 3,785, accounting for 31.5 percent of total overseas guests.” This year will continue last year’s cross-strait activities, holding the Second Cross-Strait Tourism Expo, the Second Cross-Strait Tourism Summit Forum and the Cross-Strait Economic Cooperation and Development Forum, etc., according to Liu.
Evolvement
“During the past decade, our country’s opening up has undergone a process from being partial or regional to all-dimensional, broad and multi-level, and our development strategy of transnational investment and cooperation has also changed from focusing on introducing FDI to paying equal attention to introducing FDI and going global,” said Liu Yajun. “Reviewing the development of the CIFIT in the past decade, its evolvement just mirrors the change in our opening-up process and of our development strategy.”
Development of the fair can be divided into three phases, according to Liu.
The first four sessions (1997-2000) can be regarded as the first phase. In 1997, a regional fair for investment and trade organized by the Fujian Province was upgraded by the Ministry of Foreign Trade and Economic Cooperation (former MOFCOM) to a national fair aiming at attracting investment, and renamed as the China Fair for Investment and Trade. The four sessions all centered on the theme of “introducing FDI.”
Since the fifth session in 2001, “going global” has been added to the theme. The fair, which used to focus only on attracting foreign investment, has now attached importance to helping Chinese companies invest overseas, and gradually has become an international event on promoting mutual investment.
“Last year, the ninth session of CIFIT marked the beginning of the third phase, as the fair was formally renamed as the China International Fair for Investment and Trade,” continued Liu. The ninth CIFIT also gained approval from the Global Association of the Exhibition Industry (UFI), becoming the only UFI-approved investment event. After eight years’ development, the CIFIT has become more influential in the world, attracting more and more foreign political figures, officials from international organizations and CEOs of multinational corporations.