If nothing else changes, this would mean a growth slowdown for China" (Eichengreen). Conversely, in the energy industry this would be detrimental to our foreign direct investment because the energy industry relies heavily on growth.
Although there are clear risks and unexpected shifts that could happen to the Chinese economy in the future, we feel that with all risks considered, China is still going to be an ideal place for our foreign direct investment, especially since China is looking at alternative means of energy, such as nuclear energy, and wants to reduce energy intensity. As mentioned above, there are some issues that could occur if the inflation rate continues to rise, but "The government is likely to put off increases in utility and energy prices and maintain a loose fiscal policy despite the tightening in China's monetary policy" (China Inflation Rate).
China with the world's largest population is also the world's largest market. The Chinese market has grown exponentially over recent decades, but due to cultural and social differences it has been very difficult for foreign companies to succeed. China is known for putting a lot of emphasis on trust in relationships, and business is no exception. Understanding and behaving according to Chinese cultural and social norms can play an important role when dealing with cultural differences. Chinese culture and traditions have an undeniable effect on all business operations in China. Because China has the world's largest population, diversity within the country is expected. China has more than fifty different minority groups, each of whom have their own cultures, customs, norms, traditions, unique holidays and languages. The country is geographically divided into different regional centers, and each of the centers has unique cultures and traditions. It is important to understand the cultures and traditions of the specific centers when determining which would be best for foreign direct investment (Lin and Stoianoff).