9. Will China see a sharp decrease in foreign direct investment?

Jack Perkowski, founder of JFP Holdings

China will remain a magnet for foreign direct investment in 2012. While all major international companies are already here, most are planning to increase their investments in the country. Moreover, we are now seeing many small- and medium-sized companies coming to China for the first time.

For many companies, China's intellectual property rights (IPR) is their biggest concern. However, if these companies truly have a product that is needed in China and they don't manufacture it here it because of the IPR issue, a Chinese company will eventually figure out how to make it and they will have new competitors anyway.

My advice is to manufacture the product in China so that these companies can meet the competition head-on and be most competitive.

One reason that some international companies feel business is getting more difficult in China is because local companies are becoming stronger and gaining market share every month.

While many companies may not be as enthusiastic about manufacturing products in China and shipping them back to the United States or Europe, because costs in China are going up and the yuan is appreciating against the dollar, they will still want to produce in China in order to gain access to the market.

Li Xiaogang, director of the Foreign Investment Research Center at Shanghai Academy of Social Sciences

A new frontier area for attracting investment in 2012 will be the service industry. The Ministry of Commerce and 33 other departments have recently released the outline for the service trade development plan during the 12th Five-Year Plan (2011-2015) period.

The volume of service import and export will hit $600 billion over the next five years with an annual growth of more than 11 percent.

For companies with a competitive edge in the service industry, the years ahead will be a golden chance to invest in industries such as healthcare and design as service demand from the domestic market surges. The service industry accounts for only about 40 percent of China's GDP.

Inflows of investment from Europe and the United States slipped in China in 2011, mainly because of their grim economic prospects. Once their crises ease, China will be an attractive destination for direct foreign investment from Europe and the US.

More than 80 percent of foreign companies investing in China prefer to build wholly owned companies in the country now that China has opened up so much and has enormous growth potential. They want to enjoy all the benefits.

Foreign-invested companies in China are gradually shifting their focus to China's domestic market, which has put greater pressure on China's legal environment. Improvements to the legislative system will be crucial for China to continue to attract foreign investment in the coming years.

10. Will China's local government debt see default on a large scale in 2012?

Jia Kang, director of the Ministry of Finance's research institute for fiscal science

Overall fiscal risks are under control because the authorities have been given a clear picture of the debt scale and are thus more sure about tackling the major risks within it. The 4 trillion yuan ($627 billion) stimulus package in late 2008 has often been criticized for causing problems, but we should not forget that every penny goes to a worthy cause, such as reconstruction after the Wenchuan earthquake and improvements to Beijing's traffic system.

There are no signs yet of bad debts on a threatening scale. Although 20 percent of local governments at municipal level have a debt ratio of more than 100 percent, it does not necessarily mean they will default given that most of them have strong growth rates.

Even if a default is inevitable, local officials will try every means to fill the hole so as not to affect their track record. For undeveloped areas, the central government will probably come to the rescue.

Charlene Chu, head of China Financial Institutions at Fitch Ratings

The massive influx of liquidity since the crisis has helped corporations meet obligations on previous debt. However, a loose credit policy can't remain in place forever, particularly in an environment of high inflation.

Credit risk has risen from an overextension of loans to local governments and property firms, both of which have questionable medium-term repayment capacity. Off-balance-sheet activity has also grown, adding fire to the credit boom and providing banks with new channels to window-dress financials.

If local governments were to encounter repayment issues, this could extend beyond their obligations to banks to their obligations to contractors and subcontractors of projects, etc. In this regard, the entire transport and infrastructure portfolio could be affected.