From January to February this year, the number of newly established foreign-funded enterprises in China reached 7,160, a year-on-year increase of 34.9%——
Why do multinational company executives visit China intensively?
Our reporter Wang Wenzheng
"People's Daily Overseas Edition" (Page 06, April 9, 2024)
Recently, many multinational company executives have come to China to participate in forum meetings, discuss business cooperation, inspect the investment environment, and connect with relevant departments, and they continue to become "hot searches". Echoing this, the number of newly established foreign-funded enterprises in China increased by 34.9% year-on-year in the first two months of this year; the State Council has introduced a series of policies and measures to attract and utilize foreign investment with greater efforts; surveys show that foreign-invested enterprises are satisfied with China’s business environment Continuous improvement.
Why do multinational company executives visit China intensively? What activities did they participate in? What signals did their remarks during their visit to China send?
Cast a vote of confidence with action
Since March this year, executives from multinational companies have visited China intensively——
On March 20, Apple CEO Cook appeared in Shanghai and met with Wang Chuanfu, chairman and president of BYD Co., Ltd. BYD Electronics, Lens Technology, Changying Precision and other Apple suppliers demonstrated intelligent manufacturing technology and provided services for Apple. parts and products produced. The next day, Apple's largest retail store in mainland China opened in Shanghai. Cook said that Apple will strengthen long-term cooperative relationships with Chinese supply chain partners and achieve a win-win situation in green manufacturing and smart manufacturing. "There is no place more important to Apple's supply chain than China," Cook said.
The 2024 Annual Meeting of the China Development Forum, held from March 24 to 25, attracted executives from nearly a hundred multinational companies. At the meeting, many executives mentioned that China plays an increasingly important role in promoting global innovation and expressed their willingness to continue to deploy in China.
"We plan to expand investment in China, and will soon break ground on an expansion project with an investment of more than 4.3 billion yuan in Xi'an, Shaanxi." said Sanjay Mehrotra, president and CEO of Micron Technology.
"We will give full play to our digital advantages, accelerate the dual transformation of digitalization and green and low-carbon, share green opportunities with Chinese industries, and jointly promote high-quality development." said Zhao Guohua, chairman of Schneider Electric Group.
"Mercedes-Benz's strategic goal of developing electric vehicles remains unchanged, and it will resolutely expand investment in China." Kallinson, chairman of the board of directors of Mercedes-Benz, said that Mercedes-Benz is willing to strengthen cooperation with the Chinese automobile industry and play an active role in promoting the reduction of trade barriers and maintaining a fair competitive environment.
In addition to speaking out, many multinational company executives choose to walk around and take a look in person to experience the investment environment in various places up close.
At the end of March, the China Council for the Promotion of International Trade organized a number of foreign business associations and institutions, as well as representatives from more than 30 foreign-funded enterprises such as Qualcomm and GE Healthcare (China) to participate in the "Hainan Tour" event, the first stop of the "local tour" of foreign enterprises, including Fortune 500 companies. 15 companies, conducting government-enterprise dialogue, investment talks, park research, industrial investigation and docking in Haikou, Sanya and other places.
At the first landmark event of "Invest in China" held on March 26, in front of more than 140 entrepreneurs and representatives of foreign business associations in China from 17 countries and regions, the Ministry of Commerce, the People's Bank of China, the Central Cyberspace Administration of China, In response to the concerns of foreign-funded enterprises, relevant officials in Beijing interpreted relevant policies in areas such as optimizing the foreign investment environment, regulating cross-border data flows, optimizing payment services, and promoting trust enhancement and dispelling doubts.
According to He Yadong, spokesperson of the Ministry of Commerce, the head of the Ministry of Commerce recently met with the global leaders of more than 20 multinational companies such as Apple, Qualcomm, and Mercedes-Benz. The relevant multinational companies cover medicine, automobiles, food, finance, cosmetics, electronic information, chemical industry and energy and other fields.
During the exchange, executives from multinational companies expressed that they would continue to invest in China. Apple said it will continue to increase investment in China's supply chain, R&D and sales. The German chemical company Wacker stated that it will firmly invest in China to assist the green and low-carbon transformation of the chemical, automotive, energy and other industries. "Multinational companies from all walks of life visit China intensively to feel the strong spring mood of China's economic recovery, which demonstrates the strong 'magnetic attraction' of the Chinese market." He Yadong said.
Continue to increase investment in China
The intensive visits to China by executives of multinational companies are a microcosm of the continued increase in investment in China by foreign businessmen.
According to data from the Ministry of Commerce, from January to February this year, the number of newly established foreign-invested enterprises in China reached 7,160, a year-on-year increase of 34.9%. The relevant person in charge of the Foreign Investment Department of the Ministry of Commerce said that this number is the highest level in the past five years, showing that multinational companies are still optimistic about the development opportunities of the Chinese market and continue to increase investment in China.
In terms of sources, investment in China from some developed economies has grown rapidly. From January to February, actual investment in China from France, Spain, Australia, and Germany increased by 585.8%, 399.3%, 144.5%, and 19.8% respectively. "Although some countries are promoting the repatriation of industries and capital and introducing China-related investment restrictions, which have interfered with normal cross-border investment decisions, there are still many multinational companies that choose to continue investing in China." The person in charge said.
From a structural perspective, as China continues to promote high-quality economic development, foreign investment in China is also constantly transforming and upgrading. From January to February, 1,865 new foreign-invested enterprises were established in the high-tech industry, a year-on-year increase of 32.2%, and the actual use of foreign investment was 71.44 billion yuan, accounting for 33.2% of the country's actual use of foreign investment, an increase of 1.2 percentage points from the same period in 2023. Among them, the actual use of foreign investment in high-tech manufacturing was 28.27 billion yuan, a year-on-year increase of 10.1%.
Not long ago, the China Council for the Promotion of International Trade released a survey report on nearly 600 foreign-funded enterprises, which showed that the satisfaction of the interviewed foreign-funded enterprises with China's business environment continues to increase. "More than 80% of the foreign-invested enterprises surveyed rated China's business environment in 2023 as 'satisfactory' or above, more than 90% believe that the Chinese market is attractive, and nearly 70% are optimistic about the prospects of the Chinese market in the next five years." Yang Fan, spokesman for the China Council for the Promotion of International Trade, said .
Foreign businessmen are investing more in China because of China's ever-improving business environment.
At the first landmark event of "Invest in China", the Ministry of Commerce released a series of measures to stabilize foreign investment: increasing the amount of opening up at a higher level, continuing to reduce the negative list for foreign investment access, increasing the catalog of encouraged foreign investment industries, using "one reduction" "One Growth" allows more foreign capital to be "willing to come" and "can come in"; stabilize the stock with better services, hold monthly roundtable meetings for foreign-funded enterprises, and promote the solution of issues that foreign-funded enterprises are concerned about; improve quality with more precise policies , increase policy support for investment in R&D centers, advanced manufacturing, green and low-carbon, digital economy and other fields, and create good conditions for foreign investment to participate in the development of China's new productive forces.
Foreign businessmen’s increased investment in China cannot be separated from China’s strong guarantee and docking measures.
Yang Fan introduced that the China Council for the Promotion of International Trade’s special work group for serving foreign-funded enterprises has hosted nearly 40 key activities such as local tours of foreign-funded enterprises and foreign-funded enterprise symposiums in the past two years. The national trade promotion system has promoted or actively responded to more than 6,000 demands of foreign-invested enterprises. China Council for the Promotion of International Trade The "Invest in China" platform has released 6,152 investment projects, 1,461 policy documents, 2,892 investment news items, and collected information on 20,000 domestic key parks, facilitating the signing and implementation of many foreign investment projects.
The increased investment in China by foreign businessmen is also a sign of favor for China's ultra-large-scale market.
The relevant person in charge of the Ministry of Commerce said that the favorable factors for China's attraction of foreign investment still outweigh the unfavorable factors, and the prospects for investing in China are bright. "The fundamentals of China's long-term economic growth have not changed. China's comprehensive advantages in attracting investment, including its large market size, complete supply chain supporting facilities, complete infrastructure, and abundant human resources, are still outstanding. Coupled with a series of measures to stabilize the economy, promote openness, and attract investment, The policy effects of foreign investment continue to appear, which will create more favorable conditions for attracting foreign investment," the official said.
Confidence in developing in China is stronger
According to data from the United Nations Conference on Trade and Development, global foreign direct investment (FDI) will fall by 18% in 2023. Against this background, multinational companies' confidence in the Chinese market is extremely valuable.
During the "Hainan Tour" activity, foreign-funded enterprises raised more than 40 issues and appeals, all of which were solved or responded to by relevant functional departments of Hainan Province. Many enterprises are also working with Hainan Province in the fields of digital economy, health care industry, equipment remanufacturing, and environmental protection. Reach an intention to cooperate.
The Japan External Trade Organization stated that nearly 90% of Japanese companies surveyed will maintain or increase investment in China. The European Chamber of Commerce in China stated that 77% of the companies surveyed intend to expand their business in South China; the American Chamber of Commerce in China stated that the profitability of most US-funded companies in China will improve in 2023, and more than 50% of the companies surveyed regard China as the first Or the top three investment destinations; the German Chamber of Commerce in China stated that more than half of German companies plan to increase investment in China in the next two years... During the "Hainan trip", many foreign business associations and institutions in China stated that most foreign-funded companies will still China is regarded as an important investment destination and is optimistic about China's economic expectations.
The Central Economic Work Conference made it clear to "consolidate the fundamentals of foreign trade and foreign investment" and "expand high-level opening up to the outside world"; the General Office of the State Council issued the "Action Plan for Solidly Promoting High-level Opening Up to the Outside World and Making Greater Efforts to Attract and Utilize Foreign Investment" (hereinafter referred to as the "Action Plan"); Multiple departments have intensively introduced measures to promote "quality improvement and stable quantity" of foreign trade... China's series of institutional arrangements and policy measures for high-level opening up have made foreign investment more confident in developing in China.
Li Dawei, a researcher at the Institute of Foreign Economics of the China Academy of Macroeconomics, believes that current foreign-funded enterprises investing in China no longer mainly focus on preferential tax treatment, but more on achieving mutual benefit and win-win results in the process of deeply exploring the Chinese market. In this regard, the "Action Plan" launched measures such as formulating fair competition review rules in the field of tendering and bidding, supporting foreign-invested enterprises to participate in the formulation and revision of standards, improving the scientific level of administrative law enforcement, and improving the service system for foreign-invested enterprises, in order to accelerate the construction of a unified national market. Provided institutional guarantees.
In terms of implementing the "Action Plan", the relevant person in charge of the National Development and Reform Commission stated that they will actively take effective measures with relevant departments to carry out access pilot projects in relevant fields, strengthen services for major foreign investment projects, and increase relevant policy support to encourage and support Foreign-funded enterprises invest in China's green economy, digital economy and health industry, and work with the Chinese market to share China's ultra-large market opportunities.
Yang Fan said that he will continue to expand the functions of the special class to serve foreign-funded enterprises, better play the role of the special class, insist on running the brand activity of "local travel" for foreign-funded enterprises, and improve the normal dialogue mechanisms such as symposiums for foreign-funded enterprises and exchange meetings between Chinese and foreign enterprises. Regularly conduct surveys and publish reports on the foreign-invested business environment, promptly respond to the demands and suggestions of foreign-invested enterprises, continuously improve the level of refinement of services, and help create a market-oriented, legal and international first-class business environment.
"Generally speaking, multinational companies are still confident in investing in China." He Yadong said that China continues to connect the world with a higher level of openness. "Choosing China means choosing opportunities; investing in China means investing in the future. We will, as always, welcome companies from all over the world to invest in China and share the dividends of China's high-quality development," said He Yadong. (People's Daily Overseas Edition)