UK will boost foreign investment into China to over £26bn by 2020

Oliver Smith
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BRITAIN is set to boost its foreign direct investment into China from £6.7bn to nearly £26bn over the next five years as China becomes one of the most attractive markets for foreign investors.

Total global foreign investment in China will soar 177 per cent by 2020 to £1.3 trillion, accounting for 2.8 per cent of China’s gross domestic product (GDP), according to a report from global law firm King & Wood Mallesons.

“Europe has welcomed Chinese investment in many strategically significant areas, and now China is taking steps to welcome European investors,” wrote Lord Green the chair of financial services industry body TheCityUK, in King & Wood Mallesons’ report Branching Out: Investment Opportunities in China in 2020.

Last year, the UK contributed one per cent of China’s total foreign direct investment, King & Wood Mallesons’ report predicts this will nearly double to 1.97 per cent by 2020.

Hong Kong will remain a key foreign investor in China contributing 63.37 per cent of the total investment by 2020, a 4.6 per cent decline, but still the largest investor country due to its favourable tax arrangements and position as an investment gateway into China.