Mainland China’s provinces seek overseas capital, with Hong Kong as go-between

Localities in mainland China are using Hong Kong to bring in foreign capital, with numerous events held in the city to entice investors

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Localities in mainland China, looking to shore up their foreign investment and boost economic growth, have turned to Hong Kong as a platform to make deals and build relationships. Photo: Getty Images

Published: 8:00pm, 14 Aug 2024

Some localities in mainland China are taking active steps to woo overseas capital via Hong Kong as foreign direct investment (FDI) continues to decline, a move seen by analysts as an attempt to hit economic growth targets under internal and external pressure.

Organisers of the China International Fair for Trade and Investment, scheduled for September in Xiamen – capital of the southeastern province of Fujian – promoted the expo at an event in Hong Kong late last month, with foreign chambers of commerce and consulates present.

Data from InvestHK showed the visit was not unique to Fujian, as numerous mainland provinces and cities have already come to Hong Kong to drum up investment after the pandemic.

“Current economic pressures are pretty high,” said Peng Peng, executive chairman of provincial think tank the Guangdong Society of Reform. “The country has to meet the yearly growth target, and the [the outlook for] foreign investment is also not optimistic.”

Figures from the State Administration of Foreign Exchange released on Friday showed a net FDI outflow of US$14.8 billion for the second quarter.

“Local governments have shown momentum in attracting foreign investors,” Peng said. “They are overcoming stress by doing actual work.”

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