China remains a important destination for overseas industries, Lu Zhongyuan, Vice Minister of the Development Research Center of the State Council, said at a forum at the Investment and Trade Expo 2010 held in Hefei, capital city of East China's Anhui Province, on June 20, 2010.

In the future, most foreign investment will come from high-end manufacturing businesses, regional research and development centers and modern services, Lu said, quoting a recent survey of more than 1,500 China-based foreign companies.

Following the onset of the global financial crisis, manufacturing businesses moved to China's neighboring countries, an issue which attracted wide attention. Because of the recent Foxconn suicides and rising labor costs, it is considered that a greater number of foreign investors will move their manufacturing businesses out of China. But a recent survey by the Foreign Economic Research Center of the Development Research Center of the State Council shows this is not correct.

The survey shows that most foreign companies continue to transfer their industries to the Chinese hinterland. They are also no longer focusing on low-end manufacturing businesses, but regional research and development centers, high-end manufacturing sectors and affiliated modern service sectors.

The survey also shows that because of China's huge domestic market, foreign investors are continuing to favor China. As well, there is the second advantage of China's scale of economy. Because of these two factors, there is great potential to counteract rising labor costs. China is still very competitive in international industrial division and remains a major destination in the world industrial division chain.