This paper employs gravity models to analyze the influence of Confucius Institutes (CI) on outward trade and FDI flows from China. We find significant increases in both Chinese exports and outward FDI flows to developing countries through establishment and operation of CIs, but little impact on the same flows to developed countries. In addition, Os command stronger impacts on FDI than on outward trade. (C) 2011 Elsevier Inc. All rights reserved.