Chinese outbound direct investments into the non-financial sector almost doubled in the first quarter from a year earlier as Chinese companies were encouraged to invest abroad and opportunities arose from the European debt troubles and the global financial crisis.

The fast pace of growth will continue in the coming months of the year, although it may not be as quick as what was seen in the first quarter, said Shen Danyang, spokesman for the Ministry of Commerce. Shen said many developed and developing nations are searching the world for capital that can be used to spur their economies and, as a result, are welcoming investments from China.

At the same time, policy restrictions introduced by the Chinese government in 2011 will make State-owned enterprises more cautious about investing abroad this year, Shen said.

China’s outbound investment into the non-financial sector increased by 94.5 percent in the first quarter from a year earlier, rising to $16.55 billion, the ministry said on Tuesday in a press briefing, without disclosing figures for particular regions.

 

Of all Chinese outbound direct investment in the first quarter of 2012, about 40 percent, worth about $6.2 billion, went into mergers and acquisitions. "China’s outbound direct investment may continue to increase rapidly this year,” Shen said.China makes the fifth largest amount of outbound direct investments of any countries in the world. By the end of March, its accumulated outbound direct investments into the non-financial sector had totaled $338.5 billion. Last year saw such investments increase by 1.8 percent year-on-year to reach $60 billion.

Although Europe has expressed a commitment to dealing with its debt troubles, the world economy is still contending with great difficulties. Meanwhile, the United States, Japan, the European Union and other developed countries and regions “are still in trouble, and are not very willing to invest abroad”, Shen said.

By the end of March, 809,000 Chinese were working overseas under contracts, up by 40,000 from the same period last year.

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