Despite the long-running COVID-19 outbreak and an increasingly complex global environment, foreign corporations continue to find potential in China’s opening-up efforts, giving the Chinese economy a vote of confidence.
According to the American Chamber of Commerce in China and PwC’s 2022 China Business Climate Survey Report, over 60% of surveyed companies reported profit in China in 2021. This year, two-thirds of the companies expect to boost their investment in the country.
According to the research, over two-thirds of AmCham China’s member businesses ranked China as the top or one of the top three investment locations in the world.
According to a research released by the German Chamber of Commerce in China and KPMG, nearly 60% of German companies operating in China reported improved business operations last year, with 71% planning to spend more in the country.
In a world shaken by pandemics, China’s appeal to global enterprises stems from the country’s steady economic recovery and improved business environment.
With 8.1 percent GDP growth in 2021, the Chinese economy provided a major boost to the global economy. China’s economic growth forecast for this year is roughly 5.5 percent, which is projected to help the world economy recover.
“China’s continued and stable economic growth will bring more opportunities, and we are confident about the Chinese market’s development prospects,” said Qualcomm China Chairman Meng Pu.
Qualcomm’s work with Chinese partners has grown to a number of industries, including smartphones, integrated circuits, software, vehicles, the internet of things, and others, according to Meng.
Retail sales of consumer products in China, the world’s second-largest economy, increased 12.5 percent year on year to 44.1 trillion yuan ($6.95 trillion) in 2021, according to government figures.
Herbalife Nutrition, a worldwide nutrition firm located in the United States, saw the expanding vitality of the Chinese market and its consumers’ growing quest of healthy lifestyles.
“We believe the nutrition and health business in China will continue to grow rapidly, and we will continue to raise our investment here,” Woody Guo, senior vice-president and managing director of Herbalife Nutrition China, said.
Foreign companies are seeing greater business opportunities as China continues to open its doors wider.
According to Zhang Heping, head of Sanofi Greater China, a French healthcare company, foreign companies have more opportunities as the Chinese government continues to encourage high-level opening-up and innovation-driven development while strengthening the business environment.
The tone-setting annual Central Economic Work Conference held in December pledged to expand high-quality and institutional opening, grant foreign-funded enterprises national treatment, attract more investment from multinational companies, and facilitate the early implementation of major foreign-invested projects in 2022.
To further open up the economy, the government implemented a shorter negative list for foreign investment on January 1, reducing the number of off-limit products to 31 from 33 a year before. The auto sector’s foreign capital cap was abolished, and manufacturing restrictions in pilot free-trade zones were also eliminated.
Foreign direct investment into the Chinese mainland, as a window to watch a country’s opening-up degree and reflect its economic health, increased 11.6 percent year on year to 102.28 billion yuan in January, according to government data. The gain was the fastest and first in double digits for the same time period since 2016.
According to Kang Yong, chief economist of KPMG China, foreign investment in China would remain high in 2022 due to China’s strong economic fundamentals and competitive advantages in market size, infrastructure, and business climate.