Multinationals retain confidence in China
Despite global concerns about world economy gutted by the coronavirus pandemic, China remains a hot spot for foreign investors, according to the Ministry of Commerce.
The ministry released data showing that foreign investors are maintaining optimism and confidence about their long-term operations in the country.
A survey of more than 8,700 major foreign companies showed that 73 percent of them had recovered more than 70 percent of their production as of April 14, up 0.9 percentage points from the prior week.
To date, 98 percent of Japanese-funded companies in the southern area of China have resumed production, with 41 percent reporting the return of full workforce. Another 42 percent said 80 percent of their employees had resumed work, according to ministry spokesman Gao Feng.
In a separate survey, the American Chamber of Commerce of south China said some 75 percent of Us companies reported no plans to change their operations or investment plans in the country.
These figures come despite some media reports that Japan was urging its companies to move from China, and a comment from White House economic adviser Larry Kudlow saying the Us should “pay the moving costs” of every American company that wants out of China.
“The current pattern of the global supply chain reflects costs in various economies, supporting industries and infrastructure, and thus it isn’t easily changed by any one country,” Gao said. “Global supply chains can achieve efficiency and security only in an open and cooperative environment."
He reiterated that there has not been nor will be any large-scale withdrawal of foreign investment.
One of the companies sticking to its China strategy is German pharmaceutical giant Boehringer Ingelheim, which has invested more than 300 million euros (Us$324.5 million) here since it entered the country in 1994.
“China has been and will be one of the most significant markets for Boehringer Ingelheim,” according to company executive Pavol Dobrocky. “In the next five years, we plan to invest an additional 188 million euros in China, which will be mainly used for the expansion of several production bases in the country.”
Sam’s Club, an American membership-only retail warehouse chain owned and operated by Walmart, also revealed plans to expand its business in China, including the opening of more offline stores across the country and enhanced online business.
“Our online business is growing quickly, and we know that having a really good offline business is a great way to build a strong, sustainable business,” said Andrew Miles, president of Sam’s Club China and senior vice president of Walmart China. “We are really positive about China, so we are going to strengthen our businesses.”
French pharmaceutical company Sanofi also expressed its intention to increase investment in research and development in China.
“We expect to spend 20 million euros a year on research and development in the next five years and invest an additional 24.5 million euros in our Beijing production base to strengthen its insulin glargine product line,” the company said. “that project was only recently put into production, making the Beijing plant Sanofi’s second-largest insulin production base in the world.”
Sanofi China said the coronavirus pandemic could lead to further development opportunities and investment in the health-care industry, even reshaping the health-care ecosystem.
In terms of strength, scale and agility of economic growth, China will continue to serve as an engine of the world economy, the company said.