Foreign firms pull more money from China's slowing economy

Foreign companies pulled more money from China last quarter, a sign that some investors are still pessimistic even as Beijing rolls out stimulus measures aimed at stabilizing growth.

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China's direct investment liabilities in its balance of payments dropped US$8.1 billion (S$10.8 billion) in the third quarter, according to data from the State Administration of Foreign Exchange released late on Nov 8. The gauge, which measures foreign direct investment (FDI) in China, was down almost US$13 billion for the first nine months of the year.

Foreign investment into China has slumped in the past three years after hitting a record in 2021, a casualty of geopolitical tensions, pessimism about the world's second-largest economy and stronger competition from Chinese domestic companies in the auto and other industries.

Should the decline continue for the rest of the year, it would be the first annual net outflow in FDI since at least 1990, when comparable data begins.