Insights丨Heads of foreign investment promotion agencies in China: Few companies want to leave Chinese market
(ECNS)-- The Chinese market holds great appeal for foreign companies, with few companies expressing an inclination to withdraw from it, according to a number of speakers at an event organized by the Investment Promotion Agency of the Ministry of Commerce earlier this week.
The event is themed on briefing on the key activities of investment attraction for 2025, where representatives from foreign countries’ investment promotion agencies and business associations introduced the current investment landscape of their respective enterprises in China and shared insights on the prospects for 2025.
Onodera Osamu, director-general of Japan External Trade Organization (JETRO) Beijing Office said that China's GDP is four times that of Japan, making it an attractive destination for Japanese companies. He also noticed that China is not only a major manufacturing and consumer nation, but also a leading innovator and engineering powerhouse. Many Japanese companies are actively seeking partnerships with Chinese counterparts to diversify their sourcing networks and offer products and services tailored to local markets. Some even value Chinese market as a training hub, believing that the experiences gained here can enhance their international competitiveness. He looks forward to increased exchanges between Japan and China across political, business, and academic spheres.
Onodera further suggested that Japan and China are close neighbors separated by a narrow strip of water. For a long time, the two countries have been continuously deepening exchanges across various domains. The trade and investment ties between them are extremely close and inextricably intertwined. It is imperative to further deepen these exchanges and cooperation through the concerted efforts of both nations.
Harley Seyedin, president of the American Chamber of Commerce in South China cited the 2024 Special Report on the State of Business in South China released by the institution, saying that American companies achieve profitability in China faster than any other global market and enjoy a high rate of return. China remains the number one investment destination for companies from the U.S., Europe and other countries and regions. Moreover, no company surveyed has declared withdrawal from Chinese market. 76% of these companies have plans to further invest in China, with plans to invest more than $10.5 billion in the next three to five years.
Taking CATL’s proposal to establish battery factories in the U.S. as an example, he added that he has been “encouraged” by the potential for Chinese companies to contribute to revitalization of American manufacturing industries. He called on the new U.S. administration to further open the U.S. market and attract Chinese investment, urging both countries to continue to open their markets, manage differences in a constructive manner, and build a more balanced, mutually beneficial and win-win economic relationship.
Hwang Jaewon, president of China head office of the Korea Trade-Investment Promotion Agency(KOTRA), mentioned that China has not only played an active role in promoting the development of new manufacturing, wholesale and retail industries in emerging countries, its outbound investment model has also been transforming towards green investment with steady strides. In 2024, South Korea attracted 34.57 billion USD in foreign investment, among which China accounts for 16.7%, most of its investment being directed to green industries.
This year marks the 10th anniversary of the signing of the China–South Korea Free Trade Agreement and the 3rd anniversary of entry into force of the Regional Comprehensive Economic Partnership (RCEP). Hwang stressed that the two countries should take this opportunity to continue to deepen cooperation, and take the needs of enterprises as the starting point before formulating more detailed investment policies so as to further promote economic and trade exchanges and cooperation between the two sides.
Xu Jingbo, vice president of German Chambers of Commerce Worldwide Network (AHK) Greater China referred to some research results of his institution, which outline that 50% of surveyed German companies plan to increase their investment in China, and half of them aim to deepen cooperation with Chinese clients. Few German companies plan to leave the Chinese market. Instead, they are dedicated and committed to long-term growth in China, which offers them a lot of space.
The Chinese market is incredibly important for German companies and will play an increasingly crucial role in their global expansion, according to Xu. Closer ties will be formed between the companies and their headquarters accompanied by faster decision-making and improved efficiency, which will be a distinctive feature of their future development. Xu indicated that German companies will pay more attention to intensifying R&D investment and local productivity in China, and continue to uphold the concept of the “In China, For China” strategy.
At the event, CIPA detailed its 2025 working plans for investment promotion activities in key industries, major exhibitions and events, group visits, activities under the multilateral and bilateral mechanisms, activities to be held by its overseas branches and other overseas investment promotion projects.
Representatives from investment promotion bureaus and economic development zones in the capital Beijing and cities including Nanjing, Yibin, and Hefei, also illustrated their investment promotion policies and promotion experiences.