Industry and Ownership Structure of Chinese Overseas Direct Investment

Author: 
Bijun WANG
Yiping HUANG
Description: 
EABER Working Paper Series, No 75
Abstract: 
We argue that the industry and ownership structure of Chinese ODI is firstly in-line with the country’s own industrial features and secondly mirrored in the investment motives behind. It is found that large Chinese investors are mainly driven by natural resource seeking and strategic assets seeking, while the SMEs are keen to facilitate Chinese exports. Nevertheless, we expect a different trend in future Chinese ODI as a result of both natural diversification process and the adaption to the transformation of Chinese economy. Key changes include but are not limited to: a much diversified ownership structure, targets and strategies; a decline of relative significance in resource investments; a more focus on consumption materials and needs; a larger weight in moving abroad industries China is losing comparative advantages; and more investments in lucrative services such as finance and insurance, healthcare and education, real estate and entertainment, construction and infrastructure building.