More Mis-Counting – FDI

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FDI in China hit US$72.4 billion last year, up from the initially-reported figure of US$60.3 billion, according to reports. The increase is thought to be mainly due to big investments in the banking, insurance and securities sectors (an ommission in the original statistics that I noted here).

In this latest case of significant mis-counting (see here for the GDP revision and for other examples, including interesting analysis by Standard Chartered, see here) the Houston Chronical notes:

    ”Because in the past most foreign investment had been directed to China’s manufacturing sector, [the official] suggested that statisticians had overlooked last year’s flow of funds into financial services.”

Perhaps they will ask Ernst & Young (“Non-Performing Accountants – and Loans“) to help with their counting next time. In any case, we continue to report all statistics with a pinch of salt. For added confidence, I always recommend that business plans and decisions are based, not on the results of Google searches, but on professional market research that draws on several sources, and which includes a reality check from experienced people on the ground.

If you want some research done, please let us know.

See news source:

    Foreign Investment in China Up $72B in ’05
    Houston Chronicle – United States
    BEIJING — Strong foreign investment in financial services like banking and securities boosted China’s total foreign direct investment last year to $72.4 …

2 Responses to “More Mis-Counting – FDI”

  1. Archive » FDI Up and Down| China Business Blog Says:

    […] ly upgraded the total (actual) foreign direct investment (FDI) figure for 2005 (see “More Mis-Counting – FDI“), it has now been reported by the Ministry of Commerce that FDI i […]

  2. Archive » FDI is Falling (Or Is It?)| China Business Blog Says:

    […] drew a total investment of over US$10 billion”. Expect a clarification in due course (again). And keep an eye on all those statistics! See news sources: China uses less foreign in […]

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