Chinese foreign direct investment up sharply

Foreign direct investment into China jumped 75.2 percent in January and February from a year ago, the government said Wednesday, as Asia's number two economy remained a top investment destination.
Foreign investment in the first two months of the year, calculated together due to the distorting effects of the Lunar New Year holiday, hit 18.1 billion dollars, the commerce ministry said in a statement.
In February, actual foreign direct investment stood at 6.9 billion dollars, up 38.3 percent over the same period last year, while in January it rose 109.8 percent to 11.2 billion dollars.
Capital from US-funded companies increased 43.7 percent, while fresh capital inflows from the European Union region surged 109.9 percent.
"People are still interested in China's overall economy," Wang Tao, Beijing based economist at Bank of America.
"The Chinese economy is projected to grow at least nine, 10 percent this year, and in an environment where internationally we're going to see a lot of slowdown this obviously is a more attractive place for investment," she said.
The sharp uptick in overall investment, however, sparked some concerns of a fresh surge in hot money inflows as higher interest rates and the pace of appreciation in the Chinese currency has picked up over the past four months.
"It's my feeling that there may be hot money flowing into the country in the form of direct foreign investment," said Wang Qian, a Hong Kong-based economist with JP Morgan.