More foreign companies flock to Shanghai
By Zhang
Hongpei
A total
of 38 foreign-invested projects worth 49.2 billion yuan ($7.12 billion) landed
in Shanghai on May 30, a development that analysts said indicates the success
of China’s efforts to attract foreign capital and the latter’s confidence in
the world’s second-largest economy.
Covering
such sectors as financial services, food, vehicles and biomedicine, the
projects were collectively signed at a hotel in Shanghai, according to a report
of thepaper.cn on May 30.
Despite
the ongoing China-US trade war, eight US companies showed up on the project
list, including California-based OmniVision Technologies, which announced it
would increase investment by $20 million in its semiconductor program in its
Shanghai facility, said the report.
Other US
companies are engaged in the consumer goods, new material, auto components and
medical care sectors.
With
China’s further opening-up in the financial sector progressing, more foreign
companies can hold controlling stakes in their joint ventures in China. Both
US-based JPMorgan Chase and German insurer Allianz have invested in Shanghai to
gain a foothold.
JPMorgan
Chase announced in March that it received approval from the China Securities
Regulatory Commission to establish a new majority owned and controlled
securities company in China - JPMorgan Securities (China) Co - the first
securities company in the country controlled by foreign capital.
Separately,
China granted Allianz permission last November to set up the first wholly
foreign-owned insurance holding company.
“From a
medium- and long-term view, the Chinese market’s stability and huge potential
are advantages based on its mature supply chain, manufacturing and marketing,”
Wang Jun, deputy director of the Department of Information at the China Center
for International Economic Exchanges, told the
Global Times on Thursday, May 30.
Wang
noted that foreign companies are still voting with their feet to invest in
China although the escalating China-US trade war might pose some concerns about
their strategy.
Data
from China’s Ministry of Commerce showed earlier this month that newly foreign
companies in China stood at 13,039 from January to April this year with
investment of 305.24 billion yuan, up 6.4 percent year-on-year. The US remains
a major source of investment in the Chinese market, up 24.3 percent on a yearly
basis. Actual use of foreign capital in the country’s high-technology industries
climbed 43.1 percent year-on-year, said the ministry.
Foreign
investments that cater more to the nation’s industrial policies in pursuing
high-quality economic development are very attractive for China, according to
Wang.
Li
Xiaogang, director of the Foreign Investment Research Center at the Shanghai
Academy of Social Sciences, told the
Global Times Thursday on May 30 moves by the US to block the supply chain
for Chinese technology companies cannot dent the country’s long-term direction
in strengthening its fundamental technology research and realizing
self-sufficiency.
“Since
some Western countries have posed obstacles for Chinese companies in going
global for technological partnerships or mergers, we can introduce more such
high-tech related companies from around the globe,” said Li.
China’s
door will be opened more widely because of US protectionism, he added.
Shanghai,
the center of China’s Yangtze River Delta region, “has the best business
environment in the country to make foreign investors settle and stay,” Li
noted.
Data
from the Shanghai Municipal Commission of Commerce showed that the city
attracted 2,051 additional foreign-invested projects in the January-April
period this year, up 52.3 percent year-on-year. The total contract value recorded
$17.59 billion, an increase of 21.3 percent from the previous year.
“Foreign
companies output accounts for about 27 percent in Shanghai and the figure is
forecast to climb in the next few years,” said Li, as he suggested
establishment of an ecosystem for those companies to better pursue their
interests in China.
Overall,
China’s business climate and protection of intellectual rights have improved in
recent years, he said.
Tesla’s
Gigafactory in Shanghai is highly likely to bring in more electric vehicle
suppliers from overseas, according to Li.
Tesla
announced on May 29 that the long-awaited made-in-China Tesla Model 3 will be
available for orders on May 31.
Source:Global Times
Flags of different countries and
regions stand at a square of the CIIE venue National Exhibition and Convention
Center(Shanghai).(Photo by Yang Hui from Global Times)
More foreign companies flock to Shanghai
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