With the largest population in the world, we saw thousands of Chinese business groups visit the UK looking for investment opportunities. In particular, those clients who are seeking for value Chain, education, healthcare and Hi-tech investor from top tier cities, for example, Shanghai, Shenzhen. China's organisational and individual investors were notably willing to invest in UK businesses. However, one of the main issues was the difficultly the Chinese delegates had in meeting the right parties in the UK, as the British government and public organisations like CBBC do not have sufficient resources to receive such an array of visiting delegates. China has 34 provincial-level administrative units including two special administrative regions in Hong Kong and Macau. The UK is similar in size to one of the provinces- Guangxi, so it is an enormous and challenging task to receive groups of Chinese delegates 35 times larger than what would ordinarily be expected. The matter is further exacerbated by there being very few British official organisations who receive such delegations. It is lacking that the promotion of FDI’s rely only on large-scale government-led organizations, or what the Chinese refer to as “Top-level design” ; unofficial and private organizations and business communities have taken part in the receiving of the inward FDI groups from China. Small and medium size investment promotion agencies undertake critical roles, including Sino-UK professional associations (ACfPU is a typical example). Another characteristic of how Investment promotion agencies are organised in the UK is the Chinese community usually congregates based on hometown regions called "tonging," officially called Overseas Chinese Associations. For example, Zhejiang UK Association ( the majority of members are from Zhejiang province, China), Beijing Association of the UK ( the majority of members are from Beijing, China), etc.these agencies / associations play important roles in practice of investment promotion between the UK and China, especially from Non-profit and private IPA’s.
Investment promotion agencies (IPA’s) have been considered to be a major part of FDI facilitation
Over the past two decades, a rising number of experienced Chinese investment companies have entered the global market and played a major role in the global investment market - and some even predict that Chinese funds will dominate the global market in the near future. CCPIT works with “Going Global” Chinese companies and supports their outbound investments in key fields, including market knowledge, transaction efficiency, and risk control to enable more Chinese companies to go global successfully.
Globally, China is the second-biggest economy after the US, and its share of the world economy has grown from a mere 1.8 per cent in 1978 to 18.72 per cent in 2018, according to the International Monetary Fund (IMF).
For 40 years China has opened up to the outside world, but its tendency to protect its home-grown industries has, however, stifled foreign investment.
As Beijing seeks capital flow from outside to cushion the economic downturn, especially amid the escalating trade war with the United States, new opportunities for foreign investors are opening up. In June, 2018, Beijing announced a long-anticipated easing of foreign investment curbs on sectors including banking, the automotive and heavy industries, and agriculture, as it moved to fulfil its promise to open its markets further.
Deleveraging will remain a key theme for 2018, policies in line with this strategy have increased regulation of the financial system, tightened controls on the shadow banking sector and pushed up market rates, creating highly attractive fixed income yields. Chinese government bonds, which are currently at around 4%, offer compelling value compared to key rates across the world.
Elsewhere, the continued focus on deleveraging, combined with stringent application of environmental regulations is addressing excess capacity in China's industrial sector. Closure of inefficient, polluting factories, plus the forced closure of zombie companies is an essential step forward and frees up resources that can be channeled into developing China's new economy and rebalancing toward a consumer-and services-led economic model.
And with China's 13th Five Year plan guiding policy, administrative, financial, fiscal, and social reforms can now be implemented, and that's going to help create China's new economy.
Consumer demand will be in the forefront as reforms take hold, incomes rise and demand becomes ever-more sophisticated. Changing consumer trends will ripple through the economy and force companies to innovate and adapt their offerings to suit the market.
That's one of the reasons why advanced manufacturing will also be an investment hotspot. With China's Made in 2025 campaign at the forefront, there will be new opportunities in emerging industrial sectors, such as new energy vehicles and robotics, as well as via the ongoing upgrading of existing sectors, such as autos and electrical goods.
Boosted by China's ever-growing internet user base and the innovation of sector leaders, China's information technology sector is also a key sector to watch for the future. Covering fast-growing areas such as e-commerce, online games and fintech, top names in the tech sector will continue to perform well, and will increasingly make their presence felt overseas as they push ahead with international expansion.
In China's new economy, private companies are dominant, and they are an attractive investment prospect since they carry lower debt levels and offer attractive profitability compared with old economy sectors. Indeed, it's because of these factors that new economy sectors, in areas like IT, healthcare, and consumer, have performed consistently well against the old economy and SOE sectors over the long-term.
So, with new economy sectors coming to the fore, reforms creating opportunities, and China being emphatically 'open for business' to investors, we believe it’s the right time for investors to catch the wave as China speeds up its integration with the global economy.