In the early stages, foreign companies sent their managers, sales experts and engineers, along with product samples, to cities like Shanghai, Beijing and Guangzhou, Guangdong province to establish representative offices and test the viability of the Chinese market — particularly during the 1980s.
By the 1990s, many of these companies began building factories in locations such as Shanghai; Taicang and Kunshan in Jiangsu province; Dongguan, Guangdong; and Xiamen, Fujian province. The number of their plants surged after China's accession to the World Trade Organization in 2001.With products manufactured in China being supplied to both domestic and international markets, foreign enterprises like France's Schneider Electric and Germany's Bosch Group increasingly appointed Chinese executives to lead their operations in the country. This move was part of broader localization strategies, which also included the establishment of numerous research and development centers within China.As the People's Republic of China celebrates the 75th anniversary of its founding this year, senior executives of multinational companies said that China's recent economic reforms are poised to bolster the global supply chain network and deepen the integration of foreign investment with the country's economic growth.For global firms covering countless products and services, the Chinese market has evolved into a "hub" for fostering growth and innovation.Anna An, president for China unit at Henkel AG & Co, a German industrial and consumer goods manufacturer, said that since entering China more than 50 years ago, her company has grown alongside the country, making continuous investments that have supported talent and industry development."We will continue investing in China to further support our customers with innovative and sustainable solutions and products in sectors where we see strong future demand, such as consumer electronics, new energy vehicles, advanced manufacturing, packaging and consumer goods," she added.Viewing China as crucial to its global business strategy, Nat Madarang, president for Asia Pacific at Goodyear Tire and Rubber Co, a United States tire manufacturer, said that China's new reform initiatives, focused on expanding opening-up policies and fostering industrial upgrades and technological innovation, align well with his company's strategic objectives."We see substantial opportunities in China's ongoing reform and opening-up initiatives and remain dedicated to deepening our presence and investment in China and the broader Asia-Pacific region," said Madarang.Benefiting from the Regional Comprehensive Economic Partnership, the US company also ships tires manufactured in China to Japan and a number of Southeast Asian countries.Driven by factors like rapid industrial upgrading, shifting business models and growing demand for personalized products, many MNCs have already recognized that Chinese consumers and the business environment are continuously evolving, said Tang Yihong, a professor specializing in cross-border investment at the University of International Business and Economics in Beijing.In response, these companies have established more innovation and service centers to meet local demand in China, she said.From January to August, China's actual use of the foreign direct investment stood at 580.19 billion yuan ($81.79 billion). Affected by a high base in the same period last year, the scale of such investment decreased year-on-year, but remained at a relatively high level in the context of the past decade, said the Ministry of Commerce.In particular, nearly 37,000 foreign-funded enterprises were newly established in China during this period, a year-on-year increase of 11.5 percent.Between January and August, the foreign trade value of foreign-invested businesses reached 8.4 trillion yuan in China, up 1.5 percent year-on-year, accounting for 29.4 percent of the country's total foreign trade value, said the General Administration of Customs.Improved foreign trade structure
In the 75 years since the founding of the People's Republic of China in 1949, particularly during the era of reform and opening-up from 1978, the country's foreign trade — a key driver of economic development — has been experiencing rapid expansion, experts said.Underpinned by the country's relentless efforts to expand high-level openness and commitment to promoting trade facilitation, as well as an optimized trading structure increasingly driven by high-tech and green products, China's foreign trade is not only growing larger in size, but also shifting toward higher quality growth along the way, they added.China's merchandise trade volume has soared from $1.13 billion in 1950 to $5.9 trillion in 2023. The surge in trade has been accompanied by a proportional increase in China's share of the international market, rising from less than 1 percent in 1978 to a substantial 12.4 percent last year, said the Ministry of Commerce.According to data released by the General Administration of Customs in July, China has upheld its position as the world's top trading nation for the seventh consecutive year, and solidified its status as a major trading partner with over 150 countries and regions.China's stable export market share illustrates the country's prowess in delivering quality products that are highly sought after in the international market, said Sang Baichuan, dean of the Institute of International Economy at the University of International Business and Economics.Leveraging its integrated production and supply chain advantages alongside a culture of sustained innovation, China has garnered global acclaim for its diverse range of high-quality and high-tech offerings, Sang said.Last year, the cumulative export value of the "new trio" — electric passenger cars, lithium-ion batteries and solar cells — surpassed 1 trillion yuan for the first time, representing a 29.9 percent rise from the previous year, as shown by data from the administration.Meanwhile, embracing its colossal market scale advantage, China's imports have not only fueled its own economic growth, but also served as a robust driving force for the development of economies around the world, said Liang Ming, director of the Institute of International Trade, which is part of the Chinese Academy of International Trade and Economic Cooperation.Over the years, China has been implementing import expansion policies including reductions in tariffs on a wide range of products, streamlining of Customs clearance procedures, and increased support for foreign companies seeking to access the Chinese market, Liang said.China's import volume has remained the second-largest in the world for years, according to Customs data. The country's total imports have grown from 11.49 trillion yuan in 2012 to 17.99 trillion yuan in 2023.China's imports will continue to expand, driven by the country's ongoing economic transformation, urbanization and the rising purchasing power of its massive consumer base. This trajectory is expected to contribute significantly to the recovery and growth of the global economy in the coming years, Liang added.However, businesses in the foreign trade sector face a complex and challenging external environment marked by escalating geopolitical tensions and increasing trade restrictions, experts said, calling for stronger policy support and the cultivation of new growth drivers to counterbalance the negative impacts.China should leverage the Belt and Road Initiative, the RCEP and others to diversify its trade partnerships and explore new markets, said Xu Hongcai, deputy director of the China Association of Policy Science's Economic Policy Committee.Moreover, China should continue to advance its accession into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the Digital Economy Partnership Agreement, to align with high-standard international economic and trade rules, and expand high-level opening-up, Xu said.Reporter: Zhong Nan and Wang Keju
