Investment to balance out in 5 years

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China's international investment may match global investment here in five years, Commerce Minister Chen Deming said on Wednesday at a financial forum in Beijing.

China's outbound direct investment (ODI) in 2012 will hit $70 billion and is set to increase in 2013, Chen said.

"Maybe in the next five to 10 years, China's outbound investment and investment by international capital in China will balance," the minister said.

China's non-financial ODI was $58.1 billion in the first 10 months, up 26 percent from the same period last year, according to the minister.

Foreign investment in China amounted to $91.7 billion for the same time frame. While this marked a 3.5 percent year-on-year drop, the top spot as the leading FDI destination had already been claimed from the United States.

"An increase in overseas investment by Chinese companies is an inevitable trend," Chen said.

"With foreign reserves of $3 trillion in hand, we will not sit back and watch the assets depreciate with the third round of quantitative easing. We must inject it into the real economy and make our contribution to global prosperity," he said.

Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation, a think tank affiliated with the Ministry of Commerce, was even more optimistic, saying that it will probably take three years, or "five years at most," for outbound direct investment to match inbound.

"FDI in China is likely to grow in 2013 as the government further opens up the scope for investment, such as the services sector, and improves the investment environment. But growth will be slower than 10 percent owing to constrained transnational investments."

Surging ODI (from China) is driven by domestic enterprises expanding globally. And the lingering debt crisis in developed economies creates great opportunities for China's overseas mergers and acquisitions.

"But it's important not to forget about risk control in overseas investment, and about quality and efficiency," he said.

Examples include Sany Heavy industry, whose wind farm was axed in the US, and China National Offshore Oil Corp, whose purchase plans for Nexen in Canada ground to a halt.

China Daily contributed to the story.