Industry and Ownership Structure of Chinese Overseas Direct Investment

Bijun WANG, Yiping HUANG
EABER Working Paper Series, No 75

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.