Recently, Li Chenggang, the representative of international trade negotiations of the Chinese Ministry of Commerce, met with American business leaders, hoping for continued support from the US business community to ensure the steady and healthy development of the economic and trade relationship between the two countries. Experts believe that Li Chenggang has transformed from a “wolf warrior” into a friendly sheep, putting on a show, but the actual contrasting effect is limited. Data shows a sudden 30% decrease in foreign investment, with Li Chenggang being seen as shamelessly seeking foreign investors, making superficial remarks.
Li Chenggang, the representative of international trade negotiations and Deputy Minister of the Chinese Ministry of Commerce, met with American business leaders in Beijing on November 10. The meeting included senior advisors from the Cohen Group, Craig Allen, Co-CEO of KKR Investment Group, Per Yungfan, and Jacob Thayse, CEO of the American biotechnology company Illumina, to discuss Sino-US economic and trade relations and Illumina’s development in China.
Of note is the Chinese Ministry of Commerce’s announcement on November 10 to lift the export ban on Illumina’s gene sequencers but Illumina still remains on China’s unreliable entities list.
Market analysts point out that lifting the export ban will help improve the equipment supply for local clinical and research institutions, alleviate waiting periods for high-end sequencers and maintenance services, and benefit the entire industry chain including reagents, consumables, and outsourced services. Visibility for foreign medical and biotech companies in China is expected to increase.
Regarding this, Professor Fan Jiazhong from the Economics Department at National Taiwan University expressed in an interview with Epoch Times that the US and China are currently in a stand-off. How a company on the unreliable entities list is handled may not be the main focus, but it can be interpreted that China has two aims with this move.
The first is to relax sanctions on the list of companies, which is a friendly gesture and easy to achieve. By lifting the import restrictions, China adds a friendly touch to the US-China ceasefire without incurring any costs.
Nevertheless, Professor Fan believes that these gestures, while showy, have limited practical effects. The US will be observing whether China fulfills commitments such as purchasing American soybeans. Removing some inexplicable export bans is inconsequential and carries more of a ceremonial tone than substantive meaning.
After meeting with several American companies on Monday (10th), Li Chenggang released a statement on Tuesday, stating that China will continue to promote high-level opening-up to the outside world, actively align international high-standard economic and trade rules, and expand market access and opening-up areas with a focus on the service industry, bringing new investment opportunities for companies from various countries, including American enterprises.
Regarding Li Chenggang’s emphasis on expanding market access and opening up areas with a focus on the service industry, researcher Wang Guochen from the Institute of Mainland China Economics at the China Institute of Economic Research told Epoch Times that Li’s remarks are just superficial. Looking at China’s 15th Five-Year Plan, it is clear that China still intends to prioritize technology or high-tech manufacturing. Any remaining funds will likely be squeezed out of the service industry, with no additional policy support. Therefore, funds will continue to flow towards technology and high-tech industries, exacerbating deflation or waning consumer activities.
The “2025 China Business Report” released by the American Chamber of Commerce in Shanghai on September 10 showed a continual decline in the scale of foreign investment in China. Only 41% of US enterprises, down to a new low in four years, are optimistic about operating in China’s prospects over the next five years. Additionally, only 12% of US companies consider China their top investment destination, also hitting a historic low.
According to the report from the Chinese Ministry of Commerce, foreign investment in China plummeted by 27.1% in 2024, marking the largest decline since 2008. The State Administration of Foreign Exchange of China recently reported that in the first half of 2025, foreign direct investment in China amounted to only $31.9 billion while Chinese direct investment abroad reached $78.5 billion, resulting in a net outflow of $46.6 billion.
Wang Guochen pointed out that these data highlight China’s dire need for capital, especially with a sudden 30% decrease in foreign investment. If foreign investment shies away from China, internal funds will be trapped in a massive debt trap. Therefore, Li Chenggang is left with no choice but to shamelessly seek foreign investors.
The State Administration of Foreign Exchange released data on China’s “balance of international payments” for the third quarter and the first three quarters of this year on November 7. Among them, foreign direct investment (FDI) from foreign companies amounted to a net inflow of $8.5 billion, a decrease of 51% compared to the previous period, and plunging 92% from the peak in the first quarter of 2022.
However, a report released by the Chinese Ministry of Commerce on October 25 showed that by the end of September this year, a total of 48,921 new foreign-invested enterprises had been established nationwide, a 16.2% increase compared to the same period last year, with the actual amount of foreign capital utilized reaching 573.75 billion RMB, a 10.4% decrease from the previous year.
Official media has described this change as “rising confidence in foreign investment,” sparking doubts among the public about the true situation of attracting foreign investment in China.
Wang He, a China expert, told Epoch Times that there are structural issues with China’s foreign investment statistics. “The number of foreign-invested enterprises is increasing, but the actual amount of foreign capital being utilized is decreasing, indicating a trend towards smaller-scale foreign investment.”
Wang He pointed out that while foreign investment in China used to range in the tens or hundreds of billions, it now mainly consists of small investments from medium and small enterprises. This underscores not only a lack of incoming funds but also a significant outflow of funds from China.
In a similar vein, in November, multinational coffee chain Starbucks and global fast-food giant Burger King both agreed to sell 60% and 83% of their stakes in the Chinese retail market to Chinese companies consecutively.
Regarding this, Wang Guochen stated that the sale of shares by Starbucks and Burger King in China is not surprising—last year, Taiwanese restaurant brand “Din Tai Fung” also withdrew from the Northeast market. In light of China’s severe economic downturn, the population will only have less disposable income leading to lower consumption, with high-end consumption being the hardest hit. Therefore, the sales of Chinese shares by foreign enterprises are expected, and will likely increase in the future.
Fan Jiazhong said that the withdrawal of foreign investment is due to a structural factor in the broader environment, and a turnaround is unlikely in the short term. Therefore, the conditions that once attracted foreign investment to China no longer exist.
“Business is all about deals; it’s not about sincerity, but a couple of nice words from Li Chenggang won’t suddenly turn China into a haven for foreign investment. There is no such thing; Li Chenggang is just putting on a show for his superiors and everyone else,” said Fan Jiazhong.