On March 21, Apple unveiled its second-largest store worldwide in Shanghai, covering an impressive 3,800 square meters with an investment of nearly $12 million. Apple CEO Tim Cook personally greeted the first customers, expressing his admiration by stating, “I love China and the people.”
Despite skepticism from some quarters, international business leaders are demonstrating a strong commitment to China’s market. Ola Källenius, Chairman of the Board of Management of Mercedes-Benz Group, emphasized China’s significance, saying, “China is the biggest car market in the world, and it’s the biggest market for Mercedes. We build almost all the vehicles we sell in China.”
Jean-Pascal Tricoire, Chairman of Schneider Electric, highlighted the dynamic nature of the Chinese market: “Every year brings a different China. I always come here to understand, meet new people, learn, and collaborate with them.”
Nicolas Hieronimus, CEO of L’Oréal, shared a similar sentiment: “China is a great, super-sized market with fantastic potential. More importantly, it continues to transform, reform, open up, and support the economy in a very high-quality development direction.”
China’s commitment to opening up and attracting foreign investment remains unwavering. In his 2024 government work report, Chinese Premier Li Qiang announced efforts to further shorten the “negative list” for foreign investment and abolish all market access restrictions in manufacturing. Restrictions in service sectors like telecommunications and healthcare will also be reduced. Premier Li affirmed at Davos 2024, “China’s opening-up to the outside world is unswerving. We will continue to create good conditions for countries around the world to share China’s opportunities.”
The results are evident. In January 2024, 4,588 new foreign-invested firms were established in China, marking a 74.4 percent year-on-year increase. According to a Special Report by the American Chamber of Commerce in South China, 80 percent of participating companies reported their overall return on investment in China as positive or very positive in 2023. Furthermore, 76 percent plan to reinvest in China in 2024, and not a single company declared a complete withdrawal from the Chinese market.
Philippe Mhun, Executive Vice President of Programs and Services at Airbus, underscored the strategic importance of China: “China is not only an opportunity; it’s a given. We are already partners with China in terms of further developing aviation here. We’ve invested a lot. Our final assembly line in Tianjin is one of the most visible, and we’re going to have a second final assembly line there.”
Joe Ngai, Chairman of McKinsey & Company Greater China, posed a forward-looking question for multinationals: “They have enjoyed the Chinese market and success there for the last 20 years. The question is: What am I going to do for the next 10 years? How do I continue my success in China?”
Despite global economic challenges, China’s economy shows steady progress. Daniel Zipser, Senior Partner at McKinsey & Company, observed, “China has seen a solid recovery in 2023. We continue to see the rise of the upper middle class, and consumption increases in mid-single digits. Given the scale China is at, that is something we can celebrate.”
In the first two months of 2024, China’s total import and export of goods expanded by 8.7 percent year-on-year, with exports growing by 10.3 percent to reach 3.75 trillion yuan. Trade value of private enterprises accounted for 54.6 percent of foreign trade, up 4.2 percent from the same period last year. Foreign-invested enterprises constituted 29 percent. Many media outlets have described this performance as a “strong footing” for the start of the year.
Jeffrey Sachs, Professor at Columbia University, commented, “China’s productivity, technological advancement, and innovation are proceeding rapidly. China is the low-cost producer of most of the advanced clean, green digital technologies that the world wants. On the supply side, I think the Chinese economy is in very good shape.”
John Quelch, Executive Vice Chancellor of Duke Kunshan University, noted, “Yes, there are short-term challenges. But the recommendations put forward regarding boosting employment, especially among youth, and an inflation target of three percent to elevate consumption, are measures that will ensure the continued health of the Chinese economy.”
For businesses aiming for growth, China’s market presents significant opportunities. As global CEOs reaffirm their commitment, it is clear that China’s long-term prospects remain attractive.
Reference(s):
cgtn.com
