Education About Asia: Online Archives

Direct Foreign Investment in China: Sure Bet or Folly?

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This article shares a practitioner’s perspective of the variables, analytical constructs, and criteria for decision-making that guided our assessment of business opportunities and risks associated with Direct Foreign Investment (DFI) in the China market. It is not a review of business, political, or socio-economic literature. Current facts about China are included as a way of underscoring how many trends evident in 2002 remain intact in 2010. Some of the observations that follow are basic to any foreign investment,while China-specific information is identified. Attention focuses upon DFI in local operating companies rather than short term investments in common stock or bonds. An assessment is included about areas of concern to foreign investors.