Johnson Controls taps AI, green sectors in nation

US-based smart building solutions provider Johnson Controls is looking to seize the tremendous opportunities arising from China's artificial intelligence industry and green economy, and empower the high-quality and green transition of its advanced manufacturing sector, a senior company executive said.

China is an important part of Johnson Controls' global business network, and will continue to be a key contributor to global economic growth, said Anu Rathninde, president of Johnson Controls Asia-Pacific, highlighting the company's long-term commitment to the Chinese market.

Despite challenges and uncertainties slowing down its growth at present, China's economy is faced with tremendous opportunities to transfer toward a high-quality model, rather than reaching its peak, Rathninde said, adding he is optimistic about China's economic resilience.

The Chinese economy, he said, presents new growth potential, fueled by the development of new quality productive forces, expansion of domestic consumption, high-standard opening-up and green transition initiatives, which inject vitality and growth momentum to the economy. "We are confident in the Chinese market and determined to deepen our footprint here," he said.

"The rise of new quality productive forces signifies a transformative shift in China's economic model, replacing outdated growth drivers with more dynamic ones, and establishing the foundation for more sustained and robust economic development in the future," Rathninde said.

With innovation playing a leading role, Johnson Controls' mission and values are in line with the principles of new quality productive forces, he said.

The company has been enhancing research and development and manufacturing capabilities in China, building a local industrial ecosystem, and collaborating with industry partners to develop tailor-made solutions for the Chinese market, he added.

Johnson Controls, which entered the China market nearly 30 years ago, has 10 manufacturing plants and three R&D centers in the country.

Rathninde said these have actively contributed to China's pursuit of green, sustainable and high-quality development by leveraging building automation, smart building digital solutions and energy-efficient refrigeration products.

China has introduced a range of initiatives to promote the high-end, intelligent, and green development of the manufacturing industry, which has instilled confidence in Johnson Controls.

Rathninde said the company will contribute to the high-quality and green transition in new energy, semiconductors and electronics, pharmaceuticals and life sciences, and food and beverages in China.

Data from the Ministry of Commerce showed that the number of newly established foreign-invested enterprises in China reached 53,766 in 2023, up 39.7 percent year-on-year.

Foreign direct investment in the Chinese mainland, in terms of actual use, reached more than 1.13 trillion yuan ($156.1 billion) in 2023, down 8 percent year-on-year, the ministry said. Meanwhile, FDI in the high-tech manufacturing sector rose 6.5 percent during the same period.

China is the world's largest manufacturing country, with its industrial output accounting for nearly 30 percent of the global total, ranking first for 14 consecutive years, according to the Ministry of Industry and Information Technology.

The country has announced the removal of all restrictions on foreign investment access in the manufacturing sector, and measures to guarantee the national treatment of foreign-funded companies, which offers Johnson Controls more opportunities to collaborate with partners and customers.

China will hold a greater appeal for foreign companies, especially those in the manufacturing and producer services sectors, said Zhang Jianping, director of the China Center for Regional Economic Cooperation, which is part of the Chinese Academy of International Trade and Economic Cooperation.

A series of supportive policies aimed at drawing in more foreign investment, such as a shortened negative list for market entry and establishing more pilot free trade zones, have created favorable conditions for foreign businesses to invest in China, Zhang added.

"China's long-term strategy for green development aligns seamlessly with our commitment to facilitating local sustainable development. We will continue driving green innovation, serving local market demands, advancing our R&D capabilities, and fostering broad partnerships within the industry," Rathninde said.