What happened
China recorded steady growth in foreign-invested enterprise creation in the first half of the year, with 35,000 new firms set up, up 7.0% year-on-year. Border provinces led with sharp increases, including Heilongjiang at 79.5% and Inner Mongolia at 29.1%, while major export provinces such as Hainan and Shandong also posted strong growth. Newly established enterprises from Belt and Road partner countries, Arab countries and African Union countries all rose, and Saudi Arabia's actual investment in China grew more than 340% in the first seven months.
Foreign consumer brands reported robust Chinese sales. German skincare brand Babor saw net sales in China rise about 40% year-on-year in the first seven months, and Lindt said its first immersive flagship store in Shanghai has drawn long queues. Coach said it recorded $1.4 billion in China sales in fiscal 2026, up 35%, and plans to keep investing in new stores and experiences.
On August 28, the State Administration of Foreign Exchange issued a new batch of QDII quotas totaling $6.84 billion, the largest since June 2021. Securities and fund institutions received $3.72 billion, banks received $1.76 billion, and insurers received $1.36 billion. Cumulative approved QDII quota reached $183.009 billion by the end of August.
Why it matters
The data shows China's high-level opening-up is advancing on both fronts: attracting foreign direct investment while expanding channels for domestic investors to reach global markets. The strong showing in consumer-facing sectors suggests foreign capital is increasingly targeting China's domestic consumption demand.
The QDII quota expansion reflects a policy push to meet investor demand for global asset allocation, potentially deepening China's financial market integration. At the same time, surging sales at foreign consumer brands and accelerating investment from partner countries indicate that China remains a key market for global companies.
The combination of strong inbound investment and larger outbound channels points to a more balanced, two-way opening strategy that could shape future economic policy.
Key facts
First-half new foreign-invested enterprises rose 7.0% year-on-year to 35,000.
The new QDII quota batch totaled $6.84 billion, the most since June 2021.
Saudi Arabia's actual investment in China grew more than 340% in the first seven months.
Babor's China net sales rose about 40% year-on-year; Coach's China sales reached $1.4 billion in fiscal 2026, up 35%.
Cumulative QDII quota stood at $183.009 billion by the end of August.
What to watch next
Whether foreign consumer brands continue expanding in response to China's pro-consumption policies.
Whether QDII quota increases keep coming, signaling further liberalization of outbound investment channels.
Whether border provinces and partner countries maintain their leading pace of new foreign-invested enterprise growth.