(Bloomberg) -- China's Ministry of Commerce declared 2024 the “year of promoting consumption” as it stressed the need to revitalize demand and attract more investment in the world's second-largest economy.
“Some foreign companies say the next China is still China,” Commerce Minister Wang Wentao told reporters at a briefing in Beijing on Friday, where he defended the nation's efforts to court more direct investment from overseas.
New actually utilized foreign investment fell last year to 1.1 trillion yuan ($153 billion), the lowest level since 2020 as the slowing economy, a weak post-Covid rebound and a series of investigations into overseas firms made companies less willing to invest in the mainland. That's despite the Commerce Ministry declaring 2023 the “year of investing in China.”
Authorities at Friday's briefing emphasized that last year's FDI remained at “high levels” despite the recent drop.
They pointed to a 24-point plan unveiled in August that included a variety of pledges — from offering better tax treatment and make it easier for overseas firms to obtain visas — as a success, adding that about two-thirds of that proposal has been implemented or seen progress.
The government will also keep rolling out policies to stimulate spending, the ministry officials said, citing plans to encourage people to replace their old cars and appliances with new ones.
Read More: New Foreign Investment Into China Drops to Three-Year Low
Even so, foreign companies are downbeat about 2024. A recent survey of more than 1,700 Japanese firms in China found that most either cut or maintained investments last year. The majority don't have a positive outlook about this year.
A separate survey earlier this week showed some 54% of German firms in China thought the nation's investment appeal was falling compared to other markets. Just as many still plan to boost their spending in the Asian nation over the next two years, though.
The Commerce Ministry also said it was confident China can solidify trade this year — though Wang warned that the environment is “complex” and “grim.” Officials stressed that they are continuing to work toward joining trade deals, including a major regional alliance called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Officials are also willing to address uncertainties and costs faced by companies related to US-China tariffs and investment restrictions, Wang added. He stressed the world's two largest economies are still important trading partners.
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