MNCs seek fresh growth points in China(3)

Apart from the announcement about constructing an industrial park in Xiamen to manufacture medium voltage equipment, the French company plans to initiate the second phase of its electric power experimental innovation project in Shanghai in the second half of this year. This move aims to further enhance its local innovation footprint in China.

Vincent Bruneau, Schneider Electric's vice-president for global supply chain (China), said this new Xiamen industrial park will become a major R%26D center, manufacturing and supply hub for Rueil-Malmaison, a France-headquartered group, to supply medium voltage equipment to both Chinese and global markets. This facility is scheduled to start operations in 2025.

Riding the boom in China's automobile production, Bridgestone announced in early April that it will invest 562 million yuan in the country over the next three years.

This investment will focus on strengthening production base construction and enhancing the proportion of high-performance passenger car tire production. It will aim to better meet the diverse demands of the Chinese consumer market by offering more high-end and diversified products and services, said Agustin Pedroni, president and CEO of Bridgestone (China) Investment Co Ltd.

The Japanese company plans to invest $26 million in its tire factory in Wuxi, Jiangsu province, this year, expanding high-end passenger car tire production capacity to facilitate comprehensive enhancement and development of the factory.

Bridgestone's investment moves seem justified, given that China's auto sales rose 10.6 percent year-on-year to 6.72 million units in the first quarter. The country's vehicle exports rose 33.2 percent year-on-year to over 1.32 million units, according to the Beijing-based China Association of Automobile Manufacturers.

China's comprehensive industrial system and its efficient logistics network position the country as an ideal supplier, said Wang Xiaohong, a researcher specializing in cross-border investment at the China Center for International Economic Exchanges in Beijing.

"Whether it is simple components, intricate machinery, raw materials or high-tech products, foreign investors can effortlessly find and acquire everything they require," said Wang.

Foreign-invested enterprises' imports and exports amounted to 4.02 trillion yuan in China in the first four months, declining 0.7 percent year-on-year, accounting for 29.1 percent of the country's total foreign trade value, data from the General Administration of Customs showed.

During this period, global and domestic companies in China exported 4.62 trillion yuan worth of mechanical and electrical products such as EVs, integrated circuits and smartphones, up 6.9 percent year-on-year, accounting for 59.2 percent of the country's total export value.

Emphasizing that global companies in China are making substantial commitments to localization, engaging with diverse stakeholders, increasing investments and embracing emerging business models, Mohammed Al Ajlan, chairman of the Saudi-Chinese Business Council, said the Chinese market will continue to showcase distinctive features, especially in consumption trends and technology adoption.

To attract more foreign capital, China introduced a targeted set of policy measures to facilitate investment by overseas institutions in Chinese technology-oriented companies in late April.

This policy is designed to better accommodate the needs of overseas institutions, who seek enhanced stability and predictability in the business environment, along with expanded investment channels, smoother exit pathways and easier access to tax benefits, according to information released by the Ministry of Commerce.