China’s High-Tech Foreign Investment Jumps 33.8 Percent as September Inflows Grow 2.5 Percent

By The Edge Research Team

Foreign investors put 228.53 billion yuan, equivalent to 34.01 billion dollars, into China’s high-tech industries in the first nine months of 2026, China’s Ministry of Commerce said on 22 October. That is 33.8 percent more than a year earlier. High-tech now takes 41.6 percent of all foreign capital actually used in China. A year ago the share was 29.8 percent, on our calculation from the ministry’s 2025 release.

September grew as well. Actual use of foreign capital rose 2.5 percent year on year in the month. The nine-month total reached 548.81 billion yuan, equivalent to 81.67 billion dollars. That is still 4.3 percent below the same period of 2025. That is the narrowest cumulative gap of any 2026 release, on our reading of the ministry’s nine monthly reports this year. The widest was 10.3 percent, after April.

China’s actual use of foreign capital, January to September

Source: the ministry’s releases of 25 October 2025 and 22 October 2026. Changes for services and manufacturing are our calculation from the published totals; the other changes are as published. High-tech spans both manufacturing and services and is not additive with them. Dollar equivalents in the text are our calculation at the PBoC central parity of 6.7195 yuan per dollar on 22 October 2026.

High-tech carries the year

High-tech inflows rose by 57.69 billion yuan on the year, on our calculation. Everything outside high-tech fell 20.5 percent, on our calculation. It came to 320.28 billion yuan, down from 402.91 billion, on our calculation. The high-tech gain offset 69.8 percent of that drop, on our calculation. Had high-tech stayed at its 2025 level, the nine-month total would be 14.4 percent below last year instead of 4.3 percent, on our calculation.

The ministry named three activities. In the nine months, technology-transfer services grew 76.8 percent year on year, research and design services 59.2 percent, and electronics and communications equipment manufacturing 32.8 percent. The ranking changed between the August and September releases. In the January to August figures, research and design led at 74 percent and technology transfer followed at 64.2 percent. Technology transfer’s cumulative growth rate rose 12.6 points between the two releases, on our calculation. Research and design’s cumulative rate eased 14.8 points and electronics’ 9.1 points, on our calculation.

The high-tech share has been steady. It stayed between 39.2 and 42.4 percent in every release from February to September, peaking after June. In January alone it was 36.7 percent. September’s implied high-tech inflow was 28.27 billion yuan, or 41.1 percent of the month’s implied total, on our calculation from the two cumulative totals. So September’s growth came with much the same high-tech share as the year to date, on our reading.

Services hold up, factories give ground

Services drew 404.81 billion yuan, only 1.5 percent less than a year earlier, on our calculation. Manufacturing drew 131.94 billion yuan, down 12.1 percent, on our calculation. Services now take 73.8 percent of the total, up from 71.6 percent, on our calculation. Manufacturing’s share slipped to 24 percent from 26.2 percent, on the same calculation. The remaining 12.06 billion yuan sits outside the two sectors, on our calculation.

The split matters because the high-tech gains run through both sectors. Electronics and communications equipment is a manufacturing line. Research and design, and technology transfer, are service lines. Electronics grew 32.8 percent. So manufacturing’s fall came from other factory lines, on our reading.

New company formation softened. China registered 47,800 new foreign-invested enterprises in the nine months, down 2.3 percent from 48,921. It is the first negative cumulative reading of 2026, on our count. The count was up 25.5 percent in January and still up 0.3 percent after August. September’s implied addition was 5,218 new firms, on our calculation from the two cumulative counts.

The ministry also put the wider base in numbers in May. More than 530,000 foreign-invested firms were operating in China, with a stock of foreign investment above 3.6 trillion dollars. More than 8,000 foreign firms added to their China investment in 2025, and more than 3,000 did so in the first four months of 2026.

The cumulative path through 2026

Source: the ministry’s monthly releases, February to October 2026. Single-month growth was published only for May, up 5.9 percent, June, up 15.1 percent, and September, up 2.5 percent. Implied single months, our calculation from successive cumulative totals: July 36.19, August 41.62 and September 68.86 billion yuan.

The quarterly picture and who is investing

September’s implied inflow of 68.86 billion yuan, equivalent to 10.25 billion dollars, was the largest single month since June, on our calculation. The implied third-quarter inflow was 146.67 billion yuan, 3.8 percent less than the implied 152.54 billion of the second quarter, on our calculation from the cumulative totals. Yet the cumulative gap narrowed from 5 percent after June to 4.3 percent after September, so the third quarter compared better with 2025 than the first half did, on our reading. Every single-month growth rate the ministry has published this year has been positive, on our count: May, June and September.

Canada heads the source list, up 90.5 percent. France, Switzerland, the United States and South Korea follow, as the table shows. The figures include investment routed through free ports. Switzerland has appeared in eight of the nine 2026 lists, on our count. Canada returns after leading the January to February list at 210 percent. US growth has slowed from 24.5 percent after April.

Growth by named source economy

Source: the ministry. Growth rates include investment through free ports. The releases give growth rates only for the economies they name, and no amounts.

The Gulf has featured strongly. Saudi Arabia topped the Ministry of Commerce’s source list in three straight releases, on our count. It was up 285.5 percent after May, 359.4 percent after June and 343.7 percent after July. At the June reading, Saudi investment in China over the half year was 4.59 times its level a year earlier, on our calculation. The UAE was named in the ministry’s January to September 2025 and full-year 2025 releases, up 48.7 percent and 27.3 percent respectively. Saudi Arabia does not appear in the August or September lists, and the ministry gave no Saudi figure for those periods. Because the releases print rates and not amounts, they show the direction of Gulf investment, not its size.

Why it matters: China is still taking in less foreign money than in 2025. But the gap is the narrowest of the year on our reading, down from 10.3 percent after April, and the mix is moving toward technology. Investors are backing research, technology transfer and electronics while putting less into factories overall. September’s 2.5 percent growth was modest, yet it came with the same high-tech tilt as the rest of the year.

Outlook: To match 2025’s total of 747.69 billion yuan, the fourth quarter would need 198.88 billion yuan, on our calculation. That is 14.3 percent more than the implied 173.94 billion of the final quarter of 2025, on our calculation. The first nine months already equal 73.4 percent of last year’s total, on our calculation. On 22 June the ministry, the National Development and Reform Commission and the Ministry of Finance jointly issued an action plan on stabilising and improving the use of foreign capital. The January to October figures are next; last year they came out on 21 November.

Sources: Ministry of Commerce of China, People’s Bank of China, The Edge.

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