China’s Global Investment Grew in 2025, But Exports Outpaced Offshoring

The China Cross-Border Monitor (CBM) recorded a total of $124 billion of new FDI transactions announced by Chinese firms in 2025, an 18% increase from 2024. Completed investment also edged up 14% to $73 billion, hitting the highest level since 2019 as China’s FDI continued to recover from its pandemic lows. Greenfield projects continued to drive overall investment, but the value of acquisitions almost doubled since 2022. Automotive investment lost steam while data centers, materials, and consumer goods were the top sectors attracting Chinese capital. Investment in overseas manufacturing facilities remains elevated compared to pre-pandemic levels but is trending downward, while China’s exports reached new record highs: Chinese companies may be localizing some of their production through FDI, but China’s globalization approach remains dominated by exports.

China’s outbound FDI continued to grow but verifiable investment lags official statistics

The value of announced FDI transactions by Chinese firms increased to $124 billion in 2025 (Figure 1). This reflects the highest level of new investment since 2018 but remains well below the 2016 high. The value of completed FDI transactions increased to $73 billion, reflecting both a time lag between announcement and completion as well as project cancellations. The value of verifiable FDI transactions continues to stay well below China’s official outbound FDI data, although that gap, which represents Chinese firms holding USD at overseas subsidiaries rather than bringing them back into onshore CNY assets, has shrunk for the third year in a row.

Greenfield investment continues to dominate but M&A has almost doubled since 2022

Newly announced greenfield investment by Chinese firms reached $100 billion in 2025, driven by capital intensive projects in mining, data centers, and energy (Figure 2). The value of M&A transactions dropped every year from 2016 through 2022 but has since trended upwards and totaled $26 billion in 2025. Our dataset shows nine multibillion-dollar acquisitions in 2025, compared with an average of three per year in 2022–2024. Acquisitions were focused on mining, consumer goods, and entertainment assets.

Manufacturing FDI remains elevated, but China is not yet meaningfully offshoring production capacity

Overseas investment by Chinese firms in manufacturing facilities remained elevated compared to pre-pandemic patterns but slowed for the second year in a row (Figure 3). Except for North Africa, newly announced investment in manufacturing facilities fell across all regions, with a particularly significant drop in Central and Eastern Europe. Chinese firms have used the greater availability of domestic capital resulting from the property sector deleveraging to build up significant manufacturing capacities at home, and domestic manufacturing investment continues to far outpace overseas investment.

Even though Chinese firms are investing more in overseas production than in the past, exports continue to be the dominant channel for serving markets abroad (Figure 4). Big greenfield projects by companies like BYD have captured headlines, but the reality is that Chinese firms have built out manufacturing capacity at home at a much faster pace than production outside of China since the pandemic. Beijing’s growing concern about the leakage of home-grown technology through FDI creates additional headwinds for Chinese firms planning to set up advanced manufacturing operations in key overseas markets. Slower than anticipated localization will likely create disappointment in nations who have been betting on Chinese capital for industrial revitalization.

Auto investment drops further while materials, energy and data centers drive new activity

The automotive industry remains a major driver of investment at 13% of the total, but its share has plummeted to the lowest level since 2020, reflecting a slowdown in electric vehicle (EV) value chain manufacturing. Investment in battery materials and EV assembly has plateaued since 2024, with new battery investments nearly vanishing in 2025. However, this downturn was somewhat cushioned by a shift toward vehicle parts manufacturing, which accounted for roughly half of all automotive-related investment.

In contrast, basic materials and energy have surged to represent nearly half of all Chinese outbound investment, signaling a return to strategic asset purchases seen in the 2010s. Basic materials investment hit an all-time high of $36 billion, fueled by capital intensive processing projects like the Simandou iron ore mine in Guinea and a flurry of acquisitions. Rising market prices have also pulled Chinese capital back into gold and lithium mining and processing. Meanwhile, the energy sector continued to see investment growth across both traditional fossil fuels and renewables, with a notable uptick in wind turbine investment offsetting a decline in solar manufacturing investment.

Beyond commodities, data centers and consumer goods recorded the largest marginal growth. The information and communications technology (ICT) sector recorded the second-highest year on record, driven by a data center boom primarily concentrated in Southeast Asia. The consumer goods sector is seeing a resurgence driven by M&A activity, particularly within Europe, where Chinese firms are targeting established European brands and retail networks to expand their market share and capture higher margins in mature markets.

Asia remains the biggest attraction, with growth in MENA, Latin America, and Africa

The geographic composition of China’s FDI further shifted away from high-income economies toward low- and middle-income economies (Figure 6). In 2025, Asia remained the primary recipient with around $40 billion of new transactions, driven by a mix of manufacturing investments, data centers, and raw materials mining and processing. Investment in Sub-Saharan Africa jumped due to investments in energy and materials processing for things like steel, hydrogen, ammonia, and titanium. However, Africa historically shows lower completion rates so completed investment may turn out significantly smaller than that. Investment in the MENA region also reached a new record driven by investments in Egypt, Morocco, and several individual Gulf countries. Latin American investment was also strong, mostly in mining and infrastructure projects. North America, Europe, and Oceania together attracted less than 20% of total announced FDI, down from 70% in 2016.