Impact of Chinese confidence on Global Economy!

It was already a declaration in Millennium Development Goals during 2000 that the developed counterparties in the world are to mutually cooperate with the developing and least developed countries in accordance to the investment of certain part of their profitable income into the development activities of the developing and LDCs. This is how the history of foreign investments started. Besides that, Bangdung Conference in 1955 also advocated for the investments for the mobilization of land, labor, capital and organization in the developing countries and LDCs as these countries are capital deficient to initiate the development activities on their own.

China has rose as a major country with foreign direct investments, though had slowed down few months back due to the recession. Now, when the confidence and optimism with the second-biggest economy is rising, the growth also seems to rise and the foreign direct investment is also very likely to increase in the commodity-friendly sector. As per the data suggests, inbound investment has gained 6.3 percent whereas non-financial outbound investment have surged by 147 percent. This suggests the intensity of the investments being carried out by the Chinese economy.

Currently, foreign direct investment has been basically used to tackle the economic crisis which has been a threat to the global economy. The investment is to revive the global economy from the deep economic shit. The funds from Germany, Italy, USA and China, all have been focusing to control the upcoming threat of crisis due to weak condition of the Cyprus. The anticipation is that non-financial FDI by China may increase by 1.2 percent whereas inbound FDI will fall by 3.7 percent. These outbound investments are likely to bring the prices of commodities down in the long run, as the market will supplied with surplus money.

China’s Gross Domestic Product (GDP) has expanded by almost a 7.9 percent in recent months and this acceleration is a good enough sign for the overall commodity market as China and Chinese investors are key players in the commodity market. Let us just expect that this increment in Chinese investments help in the development also, besides the investment-friendly environment.