The volume was down 19.4 per cent from a year earlier to $3.12 billion, according to the International Business Daily.

But contracted, or promised, foreign investment for the month -- an indication of future trends -- was up 16.35 per cent to $4.839 billion, the newspaper said.

The newspaper gave no reason for the precipitous fall, although the Asian financial crisis was a likely culprit. Asia has provided the bulk of China's foreign direct investment, which reached a record $45 billion last year.

The investment goes mainly into export industries along the coast. Foreign-investment firms account for about 40 per cent of China's exports.

Foreign direct investment accounts for about 15 per cent of China's fixed asset investment, but its impact is wider than the numbers suggest because it brings in advancedtechnology and management know-how.

Earlier official data showed foreign direct investment growing 9.7 per cent to $8.596 billion in the first quarter of this year.However, April's poor performance dragged down growth for the January-April period to 0.07 per cent, the newspaper said. It said actual investment for the period was $11.716 billion.

Contracted investment in the first four months posted strong growth of 12.24 per cent to $13.558 billion.

Total accumulated foreign direct investment in China at the end of April was $233.587 billion, while accumulated contracted investment reached $534.722 billion, the paper said.

China is the world's largest recipient of foreign direct investment after the United States and takes some 40 per cent of all such investment to the developing world.

April's plunge comes off a very high figure for the same month last year and does not necessarily indicate a dramatic tumble in China's fortunes.

Monthly investment figures can be heavily skewed by singleprojects.

The bulk of China's foreign capital inflows take the form of direct investment. Portfolio inflows are very limited since China's capital account is largely closed.

China's still impressive capital inflows, on top of surprisingly healthy export growth this year, has staved off pressure for a currency devaluation. If anything, the pressure is on the yuan to appreciate.

China registered a trade surplus of $14.9 billion in the first four months of this year. Although exports to Asia plunged, expanding sales to the United States and the robust economies of Europe helped compensate for the loss.

Likewise, investors from Europe and the United States have stepped into the gap left by Asian companies.

Western investors have been encouraged by tax breaks for high-technology imports this year. Those breaks were reintroduced by Beijing in response to a 24 per cent fall in contracted foreign direct investment last year.