Net inflows of foreign direct investment (FDI) to China quadrupled in 2025 according to balance-of-payments data, signaling a structural improvement in inbound investment and renewed confidence in China’s long-term growth prospects. Preliminary balance-of-payments data from the State Administration of Foreign Exchange (SAFE) showed that China recorded an increase of USD76.5 billion in direct investment liabilities in 2025, representing net FDI inflows. The figure marked a sharp increase from USD18.6 billion in 2024, indicating a notable rebound in inbound direct investment despite extreme external shocks due to the United States tariff and sanction policies. China’s direct investment deficit – the gap between outbound and inbound direct investment – narrowed sharply on a balance-of-payments basis, shrinking to USD82 billion in 2025 from USD153.7 billion in 2024, the SAFE said.
Guan Tao, Global Chief Economist at BOCI China, said in a note that the improvements in FDI inflows reflect China’s effective policy response to external shocks, stronger-than-expected economic and financial resilience, and measures to stabilize foreign investment by expanding opening-up and improving the business environment. The recovery in foreign investment also comes as multinationals become more adapted to China’s economic transformation and pursuit of innovation-driven quality growth. Jiang Liqin, head of clients and markets for KPMG China, said that foreign enterprises are increasingly shifting from expansion to profitable models, using local digital innovations to boost efficiency, refine pricing, and strengthen competitiveness in China.
SAFE data also showed that China posted a current account surplus of USD734.9 billion in 2025, which refers to the excess of a country’s exports of goods and services, investment income and transfers over its imports and outward payments. Surplus in trade in goods came in at USD1.0234 trillion last year. On a renminbi basis, the current account surplus amounted to CNY5.24 trillion, roughly equivalent to 3.7% of the country’s GDP, which hit CNY140.19 trillion in 2025, up from 2.2% in 2024. While export growth propped up the surplus, Liu Chunsheng, Associate Professor of International Economics at the Central University of Finance and Economics, said that China’s aim is to maintain an overall balance, rather than run excessive surpluses, which could create pressure on both the economy and the renminbi.
Liu said that authorities have sought to ease the surplus by expanding imports, strengthening domestic demand and deepening opening-up in the services sector. “China’s imports hit a record high last year, securing the country’s position as the world’s second-largest import market for the 17th year,” Wang Jun, Deputy Director of the General Administration of Customs (GAC), said, as reported by the China Daily.
