What happened
On August 29, the State Administration for Market Regulation reported that the number of newly established foreign-invested enterprises in China reached 35,000 in the first half of 2026, a 7.0% increase year on year. Experts attribute the growth to policies that ease market access, streamline approval, and improve the overall business environment.
Regional data shows a 'dual-engine' pattern: export-oriented provinces such as Hainan (38.6%), Shandong (15.2%), Guangdong (8.1%) and Jiangsu (6.8%) recorded gains, while border provinces including Heilongjiang (79.5%), Inner Mongolia (29.1%), Guangxi (16.6%) and Jilin (12.0%) also saw notable increases. An investment advisor said these regions offer strong manufacturing, mature logistics and efficient government services that attract foreign capital.
By source country, Belt and Road countries, Arab states and African Union members together set up 11,000 new enterprises in China, with respective growth rates of 19.3%, 20.6% and 42.8%, offsetting declines from the US (10.7%), UK (21.4%) and Japan (34.9%). Sector-wise, health and social work (27.1%), wholesale and retail (11.9%) and accommodation and food services (11.7%) led the growth, reflecting the consumer market's appeal. The regulator pledged to continue optimizing market access and protecting foreign investors' rights.
Why it matters
The data demonstrate that China's appeal to foreign investors remains resilient despite significant drops in new enterprises from some major economies. The rapid growth from Belt and Road and emerging-market countries is diversifying the sources of foreign investment, reducing reliance on traditional Western investors.
The shift toward consumer services and the emphasis on policy packages like 'AI + consumption' indicate that China's domestic market is becoming a more important driver for foreign capital. Continued commitments to improve the business environment could help sustain this momentum.
Key facts
In H1 2026, China saw 35,000 new foreign-invested enterprises, up 7.0% year on year.
Heilongjiang posted the highest growth among border provinces at 79.5%.
Belt and Road, Arab and AU countries combined set up 11,000 new firms, with growth rates of 19.3%, 20.6% and 42.8%.
New enterprises from the US, UK and Japan fell by 10.7%, 21.4% and 34.9% respectively.
What to watch next
Will the upward trend in new foreign-invested enterprises continue through the second half of 2026? Experts expect so, pointing to the regulator's ongoing efforts to enhance registration efficiency and legal protections.
It remains to be seen whether declines from the US, UK and Japan will stabilize, and whether consumer-market-driven investment, especially in services and AI-related sectors, will continue to expand.