AsianFin -- China has introduced a new set of policies aimed at encouraging overseas investors to reinvest their earnings within the country, marking its latest attempt to stem a continued drop in foreign direct investment (FDI).

The move comes as Beijing steps up efforts to attract foreign capital, including easing market access in more sectors, against a backdrop of escalating trade tensions and U.S. tariff pressure that has weighed on investor confidence.

FDI into China fell 13.2% year-on-year to 358.2 billion yuan ($50 billion) in the first five months of 2025, according to data from the Ministry of Commerce.

A notice jointly released by multiple government departments said foreign investors are now encouraged to channel profits back into China through avenues such as establishing new businesses, increasing capital in existing ventures, or acquiring equity stakes in Chinese companies.