Global investors shift their focus inland

The Yingkoumen overpass is seen under construction in 2013 in Chengdu, capital of Sichuan province in western China. Li Hualiang / Xinhua

China's western region, which has lagged behind eastern coastal provinces during the decades of reform and opening-up, is quickly catching up

Better infrastructure, a wealth of business opportunities and untapped consumer markets are drawing global investors to China's inland areas.

Making the region more attractive is part of the central government's drive to lift living standards and develop the economies of the central and western provinces.

Many multinationals say the government's policy is succeeding.

Philips Greater China Chairman Kong Xianghui said in written comments to China Daily that China's western region is a strategic priority in the government's development agenda.

"With its increasing importance, its faster urbanization and better infrastructure, living standards in this vast area are improving. There are tremendous business opportunities being unlocked in the western region, one of the key engines driving the continuous development of China's economy," Kong said.

In Chengdu, capital of Sichuan province, the local government's support of innovative concepts and technology to create an environmentally friendly, smart and harmonious city "are recognized and welcomed by international companies", Kong added.

"We're strongly impressed and encouraged by the investment environment, innovation-promoting incentives, wealth of talent, tremendous business opportunities and unique cultural connotations of Chengdu," Kong said.

China's strategic importance has been growing on Philips' global business landscape. In 2010, Philips announced a plan to build China into another "Home Market", in addition to the United States and the company's home base in the Netherlands

Key hub

"We're building China into one of the key innovation and operation hubs of Philips Global for value creation, a hub with both global reach and influence," Kong said.

Philips China announced its "Go West" strategy in 2011, in line with the Chinese government's Western Region Development strategy. The company's move was intended to improve service to customers in the broader area of Central and West China, Kong said.

In June 2011, Philips announced that it would set up a second Chinese headquarters in Chengdu. The purpose was to leverage its strength in innovation and its advantages in the fields of health, lighting and consumer lifestyle while creating a business model fitting the local market.

"We are developing a '2017 strategy' that establishes a new blueprint for the next five years to ensure the sustainable development of Philips China. 'Go West' will assume a more important strategic position.

"We are accelerating innovation in China and for China, aiming to deliver more meaningful innovations to Chinese customers not only in the western region but across the country," Kong said.

DuPont Greater China President Tony Su said: "We see great growth potential in Chengdu because it is one of the fastest-growing cities in southwest China. Also it has great advantages in infrastructure, business environment and talent."

He noted that Sichuan is a large province in West China in terms of population, resources and economic development.

Its advantages in the high-end materials industry, resources, industrial bases, R&D capabilities and manpower support made it an important economic and industrial base in the "Go West" initiative.