July 2, 2009

Investment in China outpacing outflow

China has been making big investments abroad but officials say these outflows are unlikely to outstrip inward foreign direct investments any time soon.

The officials and other experts said ODIs, or overseas direct investments, have surged recently but that FDIs also have kept pace, China Daily reported.

Some foreign banks and organizations have said the surge may cause ODIs to overtake China's FDIs, but Chinese experts told the newspaper that is unlikely at least this year, partly because of Chinalco's failed $19.5 billion bid boost its stake in Rio Tinto, an Anglo-Australian diversified mining company with headquarters in London.

Chinalco is the Aluminum Corp. of China.

The report also said that while Chinese National Petroleum Corp. and British Petroleum won a bid to develop Iraq's biggest oilfield this week, it may not significantly raise the investment outflows this year because most deals signed in the past few months are of small volume.