The Chinese government on Monday reported its first-ever quarterly decline in foreign direct investment , potentially a sign that “de-risking” initiatives from Western governments and corporations are cutting into Beijing’s bottom line.
“Some of the weakness in China’s inward FDI may be due to multinational companies repatriating earnings,” Goldman Sachs said in an analysis Some other analysts were a bit less pessimistic, suggesting that foreign companies were pulling their retained earnings out of China largely because of those interest rates, while China is having much more difficulty than usual bringing in new investments due to rising geopolitical tensions and itsthe beginning of a trend in which foreign companies pull their profits out of China instead of “using the cash to finance new hiring and investment” during the boom years of China’s growth.