ABSTRACT
The Chinese economy is in the midst of a process of transition to a ‘New Normal’, with slower growth of real GDP, international trade and investment. China has a very high domestic saving rate and hence significant excess savings. Its outbound direct investment surpassed its inbound foreign direct investment (FDI) in 2014. Reasons for Chinese outbound direct investment include: seeking lower costs; increasing market share; acquisition of natural resources, raw materials and technology; upgrading product quality; securing trade; and diversification. Alternative models of Chinese FDI and its financing and the important issue of China-US and China-EU bilateral investment treaties are also considered.
