context: As globalisation weakens and political risks rise, Beijing is expanding abroad under its opening-up drive to secure demand, promote PRC standards and ease economic chokepoints. Its growing ODI (overseas direct investment), led by flagship projects such as the Belt and Road Initiative, reflects this shift. This is also prompting a move by Beijing to weigh GNI (total domestic and foreign income claimed by residents) alongside the traditional measure of GDP. But concerns over Beijing’s lending practices and concerns over debt sustainability could still hinder its ODI push.
Shen Jianguang 沈建光 JD.com chief economist and Jiang Chuanyue 姜传钺 JD.com senior researcher outline the biggest trends in the PRC’s ODI surge and Beijing’s transition from considering only also GNI along with GDP
- background
- Wang Wentao 王文涛 Commerce Minister emphasised the importance of giving equal importance to GDP and GNI in October 2025
- value-add generated by the production of subsidiaries established by PRC companies is counted towards the host country's GDP, but the profits are included in the PRC's GNI
- focusing not just on the economy within the PRC, but also the broader 'Chinese people's economy'
- Wang Wentao 王文涛 Commerce Minister emphasised the importance of giving equal importance to GDP and GNI in October 2025
- ODI has evolved from a tool for coping with protectionism and domestic overcapacity to a growth strategy
- it is a key driver of industrial upgrading and key to locking-in global competitive advantages
- this is a result of external uncertainty (which requires ODI to manage trade barriers and geopolitical shocks) and internal effects of stronger domestic industrial and tech capacity
- this has prompted the shift in logic from considering only GDP to GDP and GNI
- as GNI is now viewed as a more complete indicator of the PRC economy’s health
- GNI accounts for both domestic output and national income earned globally
- it is a key driver of industrial upgrading and key to locking-in global competitive advantages
- recent ODI growth has followed new regional and sectoral trends
- ASEAN and Mexico remain important destinations for outbound investment
- ASEAN is an important player for relocating the Apple supply chain, while Mexico serves as an important hedge against US–PRC trade frictions
- with Mexico tariffing the PRC, the bilateral trade relationship faces more uncertainties
- Central and Eastern Europe, as well as parts of Africa have become new focal points for investment
- these investments have helped PRC companies circumvent trade barriers and reach end markets
- the PRC’s first European automobile factory (BYD’s Hungarian plant) is about to begin production
- they have also helped the PRC tap into important strategic priorities like the energy transition and high-end manufacturing
- these investments have helped PRC companies circumvent trade barriers and reach end markets
- important sectors include manufacturing, mining and new business models
- the motivations for increased investment in manufacturing include hedging against trade uncertainty
- investments in mining ensure supply-chain stability and energy security
- mining giants like Zijin Mining, Qingshan Holding and Ganfeng Lithium are making global investments in copper, lithium, nickel and cobalt
- e-commerce, gaming and short-form video platforms have also seen growth in investment as digital infrastructure has expanded overseas
- ASEAN and Mexico remain important destinations for outbound investment
- GDP–GNI rebalancing is connected to a more 'people-centric' approach to development
- GNI reframes growth in terms of income levels and quality of life, which reflects more tangible indicators such as wealth and living standards
- ODI expansion and optimisation help resource allocation, risk diversification and capture higher returns
- this allows the PRC to overcome domestic growth constraints and build its competitive advantage