Foreign capital isn't slamming the brakes on investing in China: MIIT
Published: Jul 26, 2022 10:39 PM

A view of Shanghai Photo: VCG

A view of Shanghai Photo: VCG

In response to rumors that foreign-funded firms are leaving China, the Ministry of Industry and Information Technology (MIIT) said on Tuesday that while certain industry chain relocation is a normal phenomenon, foreign investment in China has not slowed down and the nation remains a top destination for foreign investors. 

The relocation of parts of the industry chain is a normal economic phenomenon in general, and a result of globalization and market mechanisms at work, Yao Jun, an MIIT official, told a press conference.

Though some foreign-funded firms have promoted a diversified layout, overall investment in China by foreign investors has not slowed down, Yao said, noting that China's actual use of foreign capital reached 564.2 billion yuan ($83.5 billion) in the first five months of the year, up 17.3 percent year-on-year.

China's manufacturing industry is increasingly attracting all kinds of resource factors, and more and more foreign capital is being invested in key areas such as advanced manufacturing, high and new technology, energy conservation and environmental protection, according to the official.

From January to May, the nation's high-technology manufacturing sector saw its actual use of foreign capital surge 32.9 percent year-on-year, MIIT data showed.
Other indicators also show foreign investors' growing interests in the Chinese market.

"The Chinese market remains one of the most significant global markets for German companies: 71 percent of companies intend to increase their investments here," read a business confidence survey 2021/22 conducted by the German Chambers of Commerce Worldwide Network.

German carmaker Mercedes-Benz set up a research and development center in Shanghai in March, focusing on cutting-edge areas such as intelligent interconnection, autonomous driving, software and hardware development, and big data, media reports said.

Given that China has been the largest new-energy vehicle market for seven years in a row, Mercedes-Benz is not the only international car giant expanding in China. Major carmakers such as US-based Tesla have also been increasing their production capacity in China.

Another case is Schaeffler Group, a German integrated automotive and industrial supplier, which recently invested $300 million in a new-energy and aerospace core components project in Taicang, East China's Jiangsu Province. When the project is fully operational, it is expected to generate 40 billion yuan worth of output annually, according to the Xinhua News Agency.

China has been expanding market access for foreign investment and promoting the full opening-up of general manufacturing, Yao said, vowing that China will expand the high-quality opening-up of the manufacturing sector and foster a market-oriented, law-based and internationalized business environment featuring fair competition.