Despite an unsettling global economic and political outlook, Chinese investment in the Asia-Pacific region is defying the pessimists and booming.

A report from the Griffith Asia Institute, part of Griffith University in Brisbane, Australia, showed China's engagement in the region through construction and nonfinancial investments last year totaled $37 billion, up from $29 billion in 2022.

The report, "China's investment in the Asia-Pacific: 2023", said China's cumulative engagement in Asia and the Pacific over the past 10 years topped $530 billion in 2023 with $245 billion in construction and $285 billion in nonfinancial investments.

Lead author of the report and director of the Griffith Asia Institute Christoph Nedopil said the overall foreign investment landscape "has been challenging".

He wrote the report with Jing Zhang, a research fellow with the institute, and Lili Mi, who heads the institute's China and Regional Hub.

"Despite an overall decline in foreign direct investment, China, however, has been different," said Nedopil.

"China shows no sign of cutting back on its foreign investment …especially in the Asia-Pacific region."

He said China is one of the biggest investors in the region while the Europeans, Australia and the United States are not.

"It is not hard to see why China is heavily involved (economically) in the region," Nedopil said.

He also explained why China focuses on the region. "Trade restrictions with the US means some Chinese companies look for alternative countries.

"China has been a significant investor in Asia-Pacific for some time and is expected to continue to grow."

Nedopil said much of this forms part of China's modernization efforts and shared opportunities.

On March 7, China's Foreign Minister Wang Yi spoke of the prospect of building a community with a shared future for mankind during the sessions of the National People's Congress and the National Committee of the Chinese People's Political Consultative Conference.

He said: "Building a community with a shared future for mankind is the core tenet of Xi Jinping Thought on Diplomacy.

"It is China's solution to the question of what kind of world to build and how to build it.

"Countries should rise above their differences in history, culture, geography and system, and work together to protect the Earth, the only inhabitable planet for us all."

Nedopil said much of China's investment strategy is guided by the president's push for modernization through shared opportunities.

"What is interesting is investment today tends to be more focused on commercial returns rather than political returns," he said.

"The Belt and Road Initiative remains an important policy goal, but we are seeing a more focused investment environment, especially in the areas of green technologies and mining. Green investment is becoming a key part of China's investment strategy."

Nedopil admitted that while China continues to invest in coal-fired power plants, it also invests heavily in green renewables.

Strong growth

According to the report, China's investment last year in green energy and mining saw growth with Southeast Asia receiving around 50 percent of China's regional investment.

"Chinese private companies dominated Asia-Pacific investment, particularly in the energy transition and battery materials, indicating a potential further recovery in Chinese investment and construction in the region this year (2024)," the report said.

It found that much of the investment was focused on countries aligned with the Belt and Road Initiative, with Indonesia receiving the most.

Another example of this was the recent announcement that Cambodia is moving ahead with plans to build a $1.7 billion, Chinese-funded canal that would directly connect Phnom Penh with Cambodian ports on the Gulf of Thailand.

The canal would bypass Vietnam's traditional hold on the mouth of one of Asia's biggest waterways.

In an interview with William Pesek on March 11 for the Asia Times, the chief Asia economist with HSBC, Frederic Neumann, said that China only started to venture out into the international investment landscape in the mid-2000s.

"However, after rapid increases in the first half of the 2010s, China's stock of overseas direct investment now surpasses that of Japan, Germany, and the UK."