Foreign direct investment in China turned positive in April for the first time since the start of the coronavirus outbreak, according to the data released by the Ministry of Commerce on Thursday. Foreign direct investment (FDI) rose 8.6 per cent from a year earlier to US$10.14 billion. In yuan terms, FDI increased 11.8 per cent to 70.36 billion yuan. The data comes amid an intensifying debate about whether the coronavirus outbreak will accelerate a supply chain exodus from the world’s second largest economy. The gain was the first year-on-year improvement since January, when the coronavirus began to spread rapidly from the central Chinese city of Wuhan, where it was first detected. The ministry, though, sounded a note of caution, noting the rebound in April came against a low base level in the same period last year. Nevertheless, the ministry said the rebound showed that investor confidence in China was returning. The April reading partly reversed the deep contractions in FDI seen in February and March, when it fell 25.6 per cent and 14.1 per cent, respectively, in yuan terms. For the first four months of 2020, FDI in China decreased 8.4 per cent in US dollar terms, with the decline narrowing by over a third from the drop recorded in the first quarter. Direct investment from the European Union shrank 29.1 per cent in the first four months of the year, although the ministry did not provide details of investment from the United States. There is still huge pressure on maintaining stable foreign trade and foreign investment Gao Feng “The global epidemic is still grim, global cross-border direct investment is still stuck in a severe downturn, the situation of placing foreign investment this year remains very grim and complicated, so there is still huge pressure on maintaining stable foreign trade and foreign investment,” said Commerce Ministry spokesman Gao Feng. The investment data highlighted that the pandemic has brought China closer to its trading partners covered by its Belt and Road Initiative, particularly countries in Southeast Asia. The 10 Asean nations have become key drivers for FDI in China, with their investments rising 13 per cent in the first four months of the year, compared to a year earlier. This improvement mirrored the rise of the Association of Southeast Asian Nations (Asean) in earlier becoming China’s largest trading partner this year, surpassing both the US and European Union. “The epidemic has further underscored how necessary and urgent it is to jointly build the Belt and Road,” Gao added. Gao said that China is now collaborating with other countries and regions to establish a “fast track” for senior employees of foreign companies who want to work in China. “We will continue to improve the business environment to better attract secure and stable foreign business and to continue enhancing foreign companies’ confidence in investing and operating in China for the long term,” Gao said. Beijing has ranked maintaining the pace of foreign investment and the stability of industrial chains as one of its top priorities for improving the outlook for the domestic economy, which contracted 6.8 per cent in the first quarter from a year earlier due to the impact of the coronavirus. China economy: latest data about world’s second largest economy The significant disruptions in global supply chains due to the coronavirus has increased worries about the withdrawal of foreign companies from China, a trend which was already under way due to the US-China trade war. US Trade Representative Robert Lighthizer wrote in an opinion piece on Monday that the pandemic and the Trump administration’s trade policy would bring more manufacturing back to the US. Chinese government advisers and officials have also warned that Beijing risks being isolated from a new global economic order in the post-coronavirus world, as the geopolitical tensions with the US and its allies have risen dramatically over the origins of the coronavirus.