China is reporting an overall increase in its outbound direct investment to the United States and most of Europe this year, but experts warned that the environment is still tough, and Chinese investors face challenges ahead.

Investment from Chinese companies to the United States was $1.1 billion in the first 11 months of this year, up 13 percent year-on-year, said Chen Runyun, commercial counselor at the department of outward investment and economic cooperation at the Ministry of Commerce.

The overall growth of China's ODI globally was 25 percent.

China's non-financial ODI amounted to $62.5 billion from January to November, according to the ministry.

Meanwhile, China's outbound investment to Europe fell 20.5 percent compared with the same period last year, mainly because of the absence of a major investment in Luxemburg, which contributed to half of China's investment volume in Europe in 2011.

But investments were still on the rise in other major European countries.

For example, Chinese investment saw growth of 110 percent in Germany, 72 percent in the United Kingdom, and 46 percent in the Netherlands.

Apart from Luxemburg, China's investment in European countries this year had picked up by 24 percent by November.

"Global demand remains huge for Chinese investors," Chen said, citing the $55 trillion investment demand in 2030 that is predicted by the Organization for Economic Cooperation and Development.

"The annual flow of foreign direct investment was $1.6 trillion globally in 2011, while the ODI from China was merely $60 billion to $70 billion annually, so there is still a lot of room for improvement," he said.

Moreover, although China's investment flow ranked sixth globally, its foreign investment stock ranked only 13th, as the country has become a major global investor only in recent years, he added.

By the end of 2011, cumulative investments by Chinese enterprise in the US amounted to nearly $9 billion, against $20.3 billion in European countries.

But Chinese investors have already helped create more than 14,000 local jobs in the US, and employed 50,000 in European countries.

Overall, China's overseas companies paid $22 billion in taxes in 2011, while creating 890,000 jobs, among which 73 percent were local employees.

However, challenges are rising for Chinese investors overseas as they meet more restrictions from destination countries, not only in Europe and the US but also in traditionally friendly African countries, Chen said.

He suggested that China speed up work on an investment treaty with the US.

In order to facilitate the countries' overseas investment, the Chinese Academy of International Trade and Economic Cooperation and Investment Promotion Agency of the Ministry of Commerce have been working on an "Investment Guide to Foreign Countries" since 2009.

Introducing the investing environment to 165 countries and regions in the world, the guide, published on Friday, aims to help Chinese investors become familiar with conditions in host countries and push forward the quality of China's outbound investment.

The report delivered to the 18th National Congress of the Communist Party of China clearly stated that the government encourages Chinese investors to go abroad, a way that companies can strengthen their operating capabilities in the international market and make themselves into top-ranking multinational companies globally.

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