The groundbreaking ceremony of the BASF smart Verbund project in Zhanjiang, South China's Guangdong Province on Saturday. Photo: Courtesy of BASF

The construction of a BASF smart Verbund project in China started on Saturday. The plant will be the first wholly foreign-owned large-scale petrochemical venture since China implemented its Foreign Investment Law. 

Analysts said China has become a target market of foreign companies, and it has continued to open the market.

As the first large Verbund petrochemical project solely owned by foreign capital in the country, the project signals that China's further opening-up measures are being implemented, Chinese Premier Li Keqiang said in a congratulatory letter Saturday to the groundbreaking ceremony of the BASF smart Verbund project in Zhanjiang, South China's Guangdong Province.

The total investment reached $10 billion, making it the largest investment project of BASF so far worldwide, according to BASF's website. 

"The official launch marks an important milestone, and this happened only 18 months after the first signing of the MOU. We are impressed at China's speed," a spokesperson of BASF told the Global Times on Sunday.

Another example is the US electric vehicle manufacturer Tesla, whose Shanghai Gigafactory is the first wholly foreign-owned vehicle plant in China. It only took 11 months from the foundation laying in January to the unveiling of Tesla's domestic Model 3 on Friday.

China has become an increasingly important target market for the world, given its huge size and high growth rate, which comes from rising domestic demand, Tian Yun, vice director of the Beijing Economic Operation Association, said.

The draft regulation on implementing the Foreign Investment Law, drawn up by the Ministry of Justice and a number of other State Council ministries, was posted online to solicit public opinions in November. 

"Foreign enterprises can see that the Chinese government is making efforts to improve its business environment. The support and benefit for foreign investment is national treatment," Tian told the Global Times on Sunday.

"As a multinational company with an extensive footprint in China, BASF has benefited from the simplified processes and opening-up of market access," BASF said.

By 2030, China's share of the global chemical production will increase to nearly 50 percent from 40 percent, according to BASF.

China has made huge progress in improving its business climate. China rose 15 places in 2019 and for the second year it was among the top 10 economies that improved the most in terms the ease of doing business, according to a World Bank report in October. 

Guo Xiaobei, a researcher with China Minsheng Bank, told the Global Times on Sunday that BASF wants to grow with China, and the new site will bring advanced technology and high-end management methods, and train many experts in China, which is conducive to the upgrading of the upstream and downstream industry chain and healthy competition, said Guo.

"I believe in the future, more and more international companies will come to China, which will become the world's largest goods and service market in the next 15 years. Without a foothold in this market, companies will struggle to be globally competitive, which will make it hard for them to survive in the trend of global integration," said Tian.