“The strong increase in imports last year is attributed to buoyant economic activity as well as to the success of the Government’s trade and foreign investment policies. What did China’s foreign investment policies have to do with her strong increase

“The strong increase in imports last year is attributed to buoyant economic activity as well as to the success of the Government’s trade and foreign investment policies. What did China’s foreign investment policies have to do with her strong increase in imports? (课文内容)

Foreign capital has flowed into China mostly in the form of foreign direct investment. This type of investment requires foreign industrial investors to set up production facilities locally together with their Chinese partners or alone. For production efficiency and other reasons, as a rule they bring in technology and equipment from abroad to equip themselves. Thus it would result in a rise in imports.