China has recorded an outflow in foreign investments in the second quarter amid a slowing economy and rising geopolitical tensions.
In the second quarter of 2024, China’s direct investment liabilities in its balance of payments fell $15 billion, according to data from the State Administration of Foreign Exchange (SAFE).
This is only the second time ever on record that the country has recorded an outflow. In the first six months of the year, China saw a $5 billion decline.
Pessimistic Outlook
While Chinese authorities are attempting to attract and retain foreign investments, there are ongoing concerns about the country’s slowing economy and rising geopolitical tensions.
The latest data marks a sharp turnaround after foreign investments in China peaked in 2021 at $344 billion before hitting a 30-year low in 2023 at just $33 billion. If 2024 ends up with negative figures overall, it will be the first annual outflow since 1990 when comparable data was first available.
