Sharp increase in China’s overseas direct investment

China's overseas direct investment (ODI) increased 29% y/y to USD56bn in H1 2015. Foreign direct investment (FDI) grew 8% y/y to USD68.4bn. 

Commerzbank states, the ODI should continue to rise near term and exceed FDI. The Bank notes, ODI posted a sharp increase as the government encourages local companies to 'go global' as part of its ongoing efforts to

• i) reduce over-investment and overcapacity in a number of industries
  
  
• ii) promote the internationalization of the CNY 

Other ODI-supportive developments include

• i) various China-led infrastructure institutions such as the Asian Infrastructure Investment Bank (AIIB), the New Development Bank (NDB), and the Silk Road Fund
  
  
• ii) plans to merge large state-owned enterprises to make them more competitive globally.