Multinationals show their faith in China market

Digital transformation, carbon neutrality and common prosperity offer companies prospects

Despite rising external uncertainties, multinationals plan to expand their footprint and investment in China given its robust development prospects and continuous steps in opening-up, global business leaders said.

Digital transformation, carbon neutrality and common prosperity, as part of the country's high-quality growth pursuit, are among the top areas that are seen to provide the greatest opportunities for multinationals, they said in a recent series of interviews with China Daily.

Their sentiment was reflected by recent figures pointing to the strong momentum of foreign direct investment into China. FDI into the Chinese mainland, in terms of actual use, rose 37.9 percent year-on-year to 243.7 billion yuan ($37.86 billion) in the first two months of 2022, versus 14.9-percent growth last year, the Ministry of Commerce said on Monday.

Qualcomm China Chairman Frank Meng said, "Like many domestic and foreign companies that have benefited from the continuously improving business environment in China, we are upping our investments, expanding our presence and seeing a growing list of partners in the country".

According to Meng, the US chip heavyweight will work with its Chinese partners to make technology more accessible and accelerate the 5G-powered digital economy, embracing the opportunities offered in China by digital transformation.

Despite uncertainties, such as the potential risks of decoupling and the US Federal Reserve's looming tightening measures, US engine manufacturer Cummins Inc will continue to invest in expanding its operations in China, said Nathan Stoner, vice-president of Cummins Inc and chairman of Cummins China.

"China continues to be the world's largest end-market (of engines) by volume, a critical link in our global supply chain and one of the fastest developing markets for new energy and hydrogen," Stoner said, adding that Cummins will open its $150-million research and development center in Wuhan, Hubei province, in the second quarter.

Underpinning business leaders' confidence has been China's reiteration of a high-quality development agenda.

The Government Work Report at the recently concluded annual session of the National People's Congress vowed to promote the research and application of low-carbon technologies, improve the income distribution system, and boost technological innovation as well as digital industries this year.

"Innovation, decarbonization and common prosperity rank high on China's agenda, and we anticipate China's high-quality development will drive future global economic growth over the coming decades," said Jerry Zhang, executive vice-chairman and CEO of Standard Chartered China.

The Government Work Report also highlighted the country's continuous drive in terms of opening-up, and pledged to ensure equal treatment for foreign enterprises, encourage them into a broader range of sectors and launch more trials for opening the services sector.

To further boost foreign businesses' confidence in the Chinese market, it is critical for local governments throughout the country to put into place the principle of national treatment, or treating foreign and domestic firms exactly the same way, said David Blair, vice-president and senior economist at the Center for China and Globalization.

Zhong Nan, Ma Si and Jiang Xueqing contributed to this story.