Foreign firms bullish on Chinese market despite pandemic

HANGZHOU, April 29 (Xinhua) -- Despite the latest COVID-19 flare-ups and global economic uncertainties, foreign companies are optimistic about their business prospects in China and plan to further increase investment.

According to the 2022 China Business Climate Survey Report jointly released by the American Chamber of Commerce in China (AmCham China) and PwC, around 60 percent of the surveyed companies said they made profits in China in 2021, and two-thirds of them plan to increase their investment in China this year.

Nearly two-thirds of AmCham China's member companies listed China as the world's top investment destination or among the top three investment destinations, the report said.

Against the backdrop of the pandemic, China's vast market, improved business climate, and anti-epidemic measures have injected confidence and impetus for foreign companies regarding their long-term development in the country.

Undated file photo shows the aerial view of Pinghu Economic Development Zone in Pinghu, east China's Zhejiang Province. (Pinghu Economic Development Zone/Handout via Xinhua)

MOOD REMAINS UPBEAT

In a plant belonging to world-leading automotive parts supplier Valeo in the eastern Chinese city of Taizhou, Zhejiang Province, the machines are rumbling and workers on the assembly lines are putting together products.

"In the first quarter of this year, our orders rose slightly year on year," said Wu Zongwen, general manager of Taizhou Valeo Wenling Automotive Systems Co., Ltd.

"Though production decreased in April, it didn't affect Valeo's confidence in the Chinese market," Wu noted.

Gas springs manufacturer Stabilus is also among the foreign companies that are optimistic about the Chinese market.

At its factory in the Zhejiang city of Jiaxing, all of the machines are operating well and workers are busy assembling products, though the facility's orders have been affected due to a disrupted supply chain and weak demand caused by the pandemic.

"Notwithstanding the pandemic-induced business loss, we believe the impact of the pandemic is temporary. Once the demand picks up, orders will slowly come back," said Neo Ma, operation director of Stabilus (Zhejiang) Co., Ltd.

Employees work at a workshop of gas springs manufacturer Stabilus (Zhejiang) Co., Ltd in Pinghu, east China's Zhejiang Province, April 19, 2022. (Xinhua/Yin Xiaosheng)

For the company, its confidence is underpinned by the rapid development and huge demand of the Chinese auto market. "We aim to double our business in China in the next seven to eight years," said Tian Xuefeng, CEO of Stabilus China.

In addition to the large market, China's complete industry and supply chain is also an important reason for many foreign enterprises to take root.

"Even with the resurgence of COVID-19, our production and sales in China have remained relatively stable," said Zhang Weiwei, supply chain director of Karcher Trading (China) Co., Ltd., a German manufacturer of high-pressure cleaners.

According to Zhang, the instability of the global supply chain has further strengthened the company's determination to pursue its localization strategy. "We will continue to increase investment in R&D, production and sales in China," Zhang said.

FAVORABLE BUSINESS ENVIRONMENT

China's undented attraction for foreign companies in a pandemic-jolted world is also due to the country's improved business environment.

Timely and considerate government services are crucial for foreign enterprises in tackling challenges, such as bottlenecks in logistics, caused by the latest outbreak of COVID-19.

"What impressed me most was that even when a delivery truck arrived at midnight, you would find government employees standing by to respond to any problems immediately, just like our family," said Xie Zejin, a senior executive of Nidec Elesys (Zhejiang) Corporation. "It makes us feel like we're not fighting alone."

Photo taken on April 20, 2022 shows a workshop of Nidec Elesys (Zhejiang) Corporation in Pinghu, east China's Zhejiang Province. (Xinhua/Yin Xiaosheng)

Acknowledging the impact of COVID-19 flare-ups on the business operations of foreign enterprises in China, Ministry of Commerce spokesperson Shu Jueting said earlier this month that a special working group for key foreign-funded projects has been set up, and the ministry and local authorities are taking steps to help relevant firms tide over difficulties.

"We are helping foreign enterprises, especially those in areas severely hit by COVID-19, to solve problems they encounter in the resumption of work and production, personnel entry into China, as well as logistics and transportation," said Shu, adding that some difficulties have been gradually eased.

Robust foreign direct investment (FDI) also mirrors the strong confidence of foreign companies in the Chinese market.

Undated file photo shows the buildings of Nidec Corporation in Pinghu, east China's Zhejiang Province. (Pinghu Economic Development Zone/Handout via Xinhua)

FDI into the Chinese mainland, in actual use, expanded 25.6 percent year on year to 379.87 billion yuan (about 57.4 billion U.S. dollars) in the first quarter of this year, with investment in high-tech industries logging an increase of 52.9 percent.

"Honeywell has been deeply involved in the Chinese market for nearly 90 years, and the pandemic will not shake the company's confidence in long-term development in China," said Yu Feng, president of Honeywell China.

"China's opening-up measures bring new opportunities to enterprises, and our business development in China will accelerate," Yu noted.