Securities Times reporter An Yufei Wu Xian

BMW invested 10 billion to expand its battery production center in Shenyang, Liaoning Province, and BASF invested 10 billion euros in an integrated production base in Zhanjiang, Guangdong Province... China is becoming a "strong magnetic field" to attract foreign investment.

In 2022, against the backdrop of a 40% decline in total global foreign investment, China achieved a contrarian growth, with actual foreign investment used for the whole year reaching RMB12326,8.6 billion, a year-on-year increase of 3.1891% (equivalent to US$3.8 billion, an increase of <>%) on a comparable basis.

Behind the outstanding results, there are foreign-funded enterprises in all walks of life that continue to increase the weight of the Chinese market. Why has China become a hot spot for foreign investment? What achievements have Chinese and foreign enterprises jointly created?

High-tech manufacturing has become the focus of investment

"Hello, what do you do, can you get to know me?" We are a German company engaged in transportation..."At the Sino-German (Shenzhen) Economic Forum held in Shenzhen on March 3, there were such conversations from time to time, and many Chinese and German company leaders would exchange business cards and add WeChat to discuss the prospects of cooperation between the two companies.

Behind the small conversation is the strong confidence of foreign companies in the Chinese market. Since 2023, foreign investment has continued to increase its weight in the Chinese market. According to data from the Ministry of Commerce, in the first two months of this year, the actual amount of foreign funds used in the country was 2684.4 billion yuan, a year-on-year increase of 6.1%, continuing to maintain strong growth. Among them, the actual amount of foreign capital used in high-tech manufacturing increased by 68.9% year-on-year, becoming an important area for foreign capital inflow.

The development of many Sino-foreign cooperation forums has also provided powerful "assistance" for foreign enterprises to invest in China.

On March 3, the "Year of Investing in China" Guangdong special promotion event co-sponsored by the Ministry of Commerce and the People's Government of Guangdong Province was held in Guangzhou. In the afternoon of the same day, many high-level representatives of multinational companies went to Hengqin, Qianhai and Nansha non-stop to investigate. The promotion activity resulted in 29 foreign-funded cooperation projects, with a total signed investment of 74.905 billion yuan.

Among the above 74 projects, 47 are manufacturing projects, accounting for more than 639% of the total number of projects; The investment in manufacturing projects was 200.16 billion yuan, accounting for more than 20% of the total investment. Taking Sweden Hexagon as an example, the company plans to invest in the construction of an international manufacturing base project in Shenzhen, and after the project is completed, the average annual output will not be less than <> billion yuan, and the annual local financial contribution will not be less than <>.<> billion ~ <> billion yuan.

Also on March 3, the Sino-German (Shenzhen) Economic Forum also gathered a large number of well-known German companies, including Siemens, Bayer, BMW and so on. The Securities Times reporter saw at the scene that a large number of Chinese enterprises and German enterprises actively communicated with each other to meet their own needs, and according to statistics, the forum explored a total of 29 cooperation intentional needs.

Wu Yanyan, vice president of BMW Group, told reporters: "China is Germany's largest trading partner for seven consecutive years. Last year, bilateral trade between China and Germany reached 2979.21 billion euros, an increase of <>%. Germany has its comparative advantages in many fields, such as the automotive industry, precision machine tools, machinery manufacturing, etc., and Germany has a very broad space for cooperation in these fields. ”

In June 2022, BMW invested in BMW Brilliance's Lydia plant, the third vehicle plant in Shenyang, which is the BMW Group's first digital plant that has been planned and simulated entirely in a virtual environment from the beginning, Wu Yanyan said.

It is understood that the total investment of the Lida plant is about 150 billion yuan. After the plant, BMW continued to increase its investment in China. In November 2022, BMW Group signed a contract for a new power battery project in Shenyang, with a total investment of about 11 billion yuan. Overall, BMW Shenyang has received more than RMB 100 billion in investment since 2010, making it a representative case of foreign investment.

"Evonik is the world's leading specialty chemical company with global sales of €185.3 billion last year and more than <>,<> employees worldwide." Gu Zhongmin, Vice President of Regional Development for Greater China, Evonik, said, "This year we invested in a company in Anhui Province in China, mainly making battery conductive pastes; Last year, we set up a global lithium battery application development center at our headquarters in Greater China, which is also hoping to improve our core R&D capabilities, actively cooperate with lithium battery manufacturers and OEMs in China and Asia to do localized R&D and serve the future global market. ”

Behind China's "investment fever":

The opening dividend continues to be released

Why has China become a hot spot for foreign companies, especially in manufacturing? This is not only supported by the steady development of China's economy, but also benefited from the continuous release of China's opening dividends.

The Central Economic Work Conference held in December 2022 made "greater efforts to attract and utilize foreign investment" as one of the five key tasks of economic work in 12. The meeting proposed to provide maximum convenience for foreign businessmen to engage in trade and investment negotiations in China and promote the construction of landmark projects of foreign investment.

The 2023 Government Work Report singles "foreign investment" as an important content, emphasizing greater efforts to attract and utilize foreign investment.

Since the beginning of this year, the Ministry of Commerce and other departments have successively introduced relevant policies to support the expansion of manufacturing investment in national-level economic development zones, and issued 16 specific measures to further encourage foreign investment in the establishment of R&D centers. The number of new entries in the new version of the Catalogue of Industries Encouraging Foreign Investment, which came into effect on January 1, also reached a record high, facilitating the application of various support policies to eligible foreign-funded enterprises.

"From the perspective of macroeconomic environment and policy trends, China's 14th Five-Year Plan and various policies and measures have created a more stable, fair and transparent investment environment, which is conducive to the sustainable growth of China's chemical industry, which has also greatly boosted BASF's confidence in operating in China." Jianfeng Lou, Chairman and President of BASF Greater China, said.

In September 2022, BASF (Guangdong) held a full-scale construction and commissioning ceremony for the first plant at the Verbund site project. It is understood that the total investment of 9 billion euros in this project is the largest single foreign investment in BASF's history. When completed, the project will be BASF's third largest Verbund production site in the world.

Bayer is also an important foreign company that has been developing in China for many years. Gao Yong, vice president of public and government affairs and sustainable development at Bayer China, said that from a global perspective, Bayer's business accounts for 50% of the medical business and agriculture accounts for 50%, but in China, Bayer's medical business accounts for 90% and agriculture accounts for 10%, "I believe that with China's high-quality development and a higher level of opening up, Bayer will have a lot of room for development in China's agricultural field."

In addition to the further release of the opening dividend, the steady growth of China's economy has also provided sufficient confidence for foreign investment. In February, China's manufacturing purchasing managers' index rose to 2.52%, the highest since May 6. The non-manufacturing business activity index was 2012.5%, up 56.3 percentage points from the previous month, and it was in the boom range for two consecutive months, and the non-manufacturing industry recovered its development trend.

Chinese and foreign enterprises compose a movement of development

The Securities Times reporter noticed that when foreign-funded enterprises invest in China, they also pay more and more attention to cooperation with Chinese enterprises.

For example, at the Sino-German (Shenzhen) Economic Forum, the forum focused on five signed key projects, all of which are German enterprises and Chinese enterprises to seek common development, such as Ode Shensi Software Group and Shenzhen Sine Electric Co., Ltd. and other companies to carry out project cooperation in CNC machine tools, intelligent robots, digital factories, virtual control technology based on industrial cloud and many other fields.

Skyworth Group in Shenzhen has also reached strategic cooperation with German company Meiz Consumer Electronics Co., Ltd. in the fields of photovoltaics and home appliances. In this regard, Huang Hongsheng, founder of Skyworth Group, said in an interview with a reporter from the Securities Times: "Germany is far ahead in science and technology, especially in manufacturing, especially upstream material science and equipment. China is leading in the level of terminal products, information industry components, software, components, including batteries. The two sides have their own advantages, complementary and complementary effects. ”

"The cooperation between China and Germany is complementary, we need its high-end equipment, precision instruments, upstream materials, it needs our efficient supply chain, including efficient iteration of industrial clusters, and the cooperation between China and Germany is getting stronger and stronger." Huang Hongsheng said, "In the future, Skyworth will increase cooperation with German partners in new energy vehicles, and since last year, we have developed distributed photovoltaics through German factories and landed throughout Europe, and the progress is also very rapid." ”

Some foreign companies that have been in China for many years have also gained insight into the trend of China's manufacturing transformation and upgrading, and have found a new direction for cooperation with Chinese enterprises. Li Haige, Digital Director of East Guangdong Region of Digital Industry Group of Siemens (China) Co., Ltd., said: "Siemens is a solution provider serving the digital transformation of industrial enterprises. We have been serving industrial enterprises in Shenzhen, Dongguan, Huizhou and Guangdong East, and we can find that many enterprises, especially leading enterprises, have largely completed a certain digital transformation, and Siemens has always emphasized the concept that we hope to serve the digital transformation of 80% of small and medium-sized enterprises in China in the future. ”

Li Haige also said that there are more things that Siemens can participate in in industry standardization at present. "Siemens has been serving many equipment companies in Shenzhen, and we hope to enable local Chinese companies to better adapt to EU standards and enter the EU market through our technical means."

On the whole, under the background of the continuous release of China's opening dividends and steady economic development, China has become a hot spot for investment by foreign-funded enterprises. The in-depth cooperation between Chinese and foreign enterprises will surely create a beautiful "development movement" in many fields such as manufacturing and service industries.