FDI drops 16.9% in July, official says antitrust probe not a cause

China's foreign direct investment dropped 16.9 percent from a year earlier in July after a brief rebound a month ago, the Ministry of Commerce said, and an official denied the fall was related to the recent anti-monopoly probe into some foreign companies.

Foreign investors channeled US$7.8 billion of funds into China last month. The pace compared with the increase of 0.2 percent in June and the contraction of 6.7 percent in May.

Shen Danyang, a spokesman at the ministry, said it was normal for foreign investment to fluctuate from month to month.

"The decline in a single month can't be used to interpret a general trend," Shen said. "It was wrong to associate it with the antitrust investigation or establish any other unfounded connections."

Shen said the recent probe, which involved multinationals including Mercedes-Benz, Microsoft and Qualcomm, was not targeted at foreign companies only, while foreign and domestic companies were equal under China's anti-monopoly law.

In the first seven months, foreign direct investment edged down 0.35 percent to US$71.1 billion with 13,247 new foreign ventures being established on the Chinese mainland.

Investment from Japan dropped 45.4 percent during the January-July period, while the United States, the European Union and the ASEAN countries reduced their investment by 17.4 percent, 17.5 percent and 12.7 percent respectively.

In comparison, funds from the United Kingdom jumped 61.2 percent during the period, and that from South Korea rose 34.6 percent.