China News Service, Beijing, February 18 (Reporter Li Xiaoyu) A recent survey report released by Germany and others shows that in the context of intensified great power competition, foreign companies do not buy into "decoupling" from China, and most foreign companies are stepping up their "coupling" with China.
The German Institute for Economic Research said in a report based on data from the Bundesbank that Germany's total direct investment in China reached a record high of 11.9 billion euros in 2023, a year-on-year increase of 4.3%. In the same year, German investment in China accounted for 10.3% of total German overseas investment, the highest level since 2014.
The report also stated that the investment amount of German companies in China in the past three years is roughly equivalent to its investment amount from 2015 to 2020.
In addition, according to a survey by the Japan Chamber of Commerce in China, more than half of Japanese companies in China have made additional new investments in China in 2023, and the performance of Japanese companies in China has improved in terms of operating income, operating profits, and operating conditions. 51% of the companies surveyed regard China as the "most important market" and "one of the three important markets" in 2024 and beyond.
According to statistics from the Ministry of Commerce of China, France and the United Kingdom's actual investment in China will increase by 84.1% and 81.0% respectively year-on-year in 2023; Australia's investment in China also increased by 17.1% year-on-year last year.
Foreign companies do not buy into "decoupling" from China. One of the main reasons is that China's economic resilience is strong. Last year, China's gross domestic product (GDP) exceeded 126 trillion yuan, a year-on-year increase of 5.2% at constant prices. This number not only far exceeds the expected global growth rate of about 3%, but also ranks among the highest among the world's major economies.
According to the International Monetary Fund (IMF), from 2024 to 2028, China's economic growth will not only continue to be significantly higher than the growth rate of developed economies, but will also be at the forefront among emerging economies and developing countries.
China's economy is developing steadily and the market continues to expand, which means investing in China will bring huge profit margins. At a time when the global economic recovery is struggling, this is extremely attractive to foreign companies.
A survey previously released by the China Council for the Promotion of International Trade showed that more than 90% of foreign-funded enterprises surveyed in the fourth quarter of 2023 expected that the profit rate of investment in China would be flat or increase in the next five years, an increase of about 5.8 percentage points from the previous quarter.
According to Mattis, the author of the German Economic Research Institute report, German companies, especially large companies, still regard China as a huge and growing market and plan to put more business in China to hedge against the effects of intensifying global trade tensions. risks of.
China's continuous improvement of the business environment has also made foreign companies more willing to delve into China. Last year, the Ministry of Commerce of China held more than ten roundtable meetings with foreign-funded enterprises to understand the suggestions and demands of enterprises face-to-face and continue to promote solutions. A total of more than 400 foreign-funded enterprises and foreign business associations participated. Wang Wentao, China's Minister of Commerce, said that foreign companies said that these activities solve problems on the one hand, and on the other hand, they show China's determination to open up and its attitude of welcoming foreign investment.
In the context of intensified competition between great powers, China needs to make more efforts to make more foreign companies willing to "link" with China.
Gao Lingyun, a researcher at the Institute of World Economics and Politics of the Chinese Academy of Social Sciences, said that China has not yet established a dispute settlement mechanism for foreign-funded enterprises, and it is often difficult for foreign-funded enterprises to provide evidence when defending their rights, which takes a long time and costs high. In addition, due to the rising cost of factors in China, the pressure on foreign companies to relocate is also increasing. Therefore, China should systematically reduce the costs of foreign companies and provide precise services to foreign companies through the construction of a unified national market. (over)