Western China becomes a favorable destination for foreign investment

China saw record-high foreign investment in 2015, up 6.4 percent from 2014. This robust growth continued in January 2016 and the central and western regions of China have shown an outstanding performance in terms of attracting foreign investment.

The actual use of foreign capital in the western part of China reached 5.87 billion yuan in January 2016, registering a year-on-year growth of 16.9 percent, according to the data released by China's Ministry of Commerce.

The western region of China has become home to quite a few important foreign-funded projects in recent years.

Samsung's high-level flash memory chip project with an investment of 7.5 billion dollars has been completed and put into operation in Xi'an, capital of northwest China's Shaanxi province.

Microsoft signed an cooperation agreement with the local government to co-build the Chongqing Microsoft Internet Research and Development Base in Chongqing in southwest China.

The BASF Group headquartered in Germany launched a pilot project of biodegradable agricultural plastic mulch that covers 1,700 mu (about 113 hectares) of land in western China's Xinjiang Uyghur Autonomous Region.

Medtronic, the world's largest standalone medical technology development company,chose to start the first production base for a new technology in Chengdu, capital of southwest China's Sichuan province.

As for the reason why western China becomes a great attraction for foreign investment, Li Dawei, associate researcher at Institute of Foreign Economics Research, points out western part of China enjoys several advantages in attracting foreign investment.

Firstly, western China has advantages in labor and land costs in traditional industries. Secondly, western China has advantages in developing modern service sector. The urbanization development and upgrading consumer demand in Chengdu, Chongqing and other western cities have created large room for investment including foreign investment. Thirdly, China's national policies create good conditions for attracting foreign capital to western China. The strategies such as "Belt and Road" initiatives and the founding of state-level new areas have laid a solid foundation for attracting foreign investment to western China.