Enterprises expand businesses in country

Economic recovery of nation seen as key growth momentum by foreign companies

Believing China's growth will outrun most major economies this year, despite challenges, German executives said they are seeing opportunities in the country's massive healthcare market.

They attributed the positive outlook to China's consistent economic recovery, promising indicators and effective policies, which are expected to bolster confidence among German businesses in the country.

Ulrich Stefer, chief financial officer of Bayer Group China, said:"China will play a crucial role in impacting global growth this year as the world's second-largest economy. We notice that various international financial institutions and investment banks have raised their predictions for China's economic growth this year."

Highlighting the country's massive market, sophisticated industrial system, strong supply chain competitiveness and an improving business environment, Stefer said the Chinese market remains attractive on a far-reaching level for multinational companies, including Bayer, to join and expand their investment.

He added that the expansion project of Bayer's Beijing pharmaceuticals plant will be completed this year.

The plant is expected to boost the company's production capacity for prescription drugs by 40 percent and improve its ability to meet the medical needs of Chinese patients.Siemens Healthineers, a German healthcare equipment provider, announced in late May that it will invest an additional 1 billion yuan($140 million) or more to set up a new research and production site in Shenzhen, Guangdong province, marking its second such facility in the southern metropolis.

"China is of elementary importance to Siemens Healthineers.Through its technology savviness and openness to partnerships and innovation, the country is already, and will continue to be, a strategic innovation driver for us locally as well as globally," said Bernd Montag, the company's CEO.

Noting that China is an "important and dynamic" market, Montag said the country is becoming an increasingly important source of innovation and creativity.

To attract more foreign capital, China will continue to push for greater market access for foreign investors as part of its efforts to expand high-level opening-up and build a unified national market, according to information released by China's Ministry of Commerce in early June.

Schott, a German manufacturer of specialty glass and a supplier of pharmaceutical packaging, plans to expand production in China. It has increased its global investment budget for this year to 500 million euros($539.6 million), with 55 million euros allocated to the Chinese market.

"In 2023, we maintain a positive outlook, although we still face global challenges, such as rising energy and raw material costs," said Frank Heinricht, board chairman of Schott.

"In the past, foreign investment in China focused on low-cost manufacturing, but now foreign and Chinese partners work together on high value-added products and services. Such collaborations will provide strong impetus for China's long-term growth," he added.

During its 2022 fiscal year, Schott's revenue grew by 4 percent on a yearly basis in China. Its research and development center in Suzhou, Jiangsu province, has developed glass to suit the needs of Chinese smartphone brands such as Xiaomi and Vivo, enabling them to launch innovative foldable devices in recent years.

That optimism is also shared by Wei Jianguo, vice-chairman of Beijing-based China Center for International Economic Exchanges."Despite subdued global foreign direct investment sentiment, China will become more attractive to foreign companies this year thanks to its wider opening-up and the anticipated rebound in economic activity."

Enthusiasm has also been boosted by the fact that domestic consumption is expected to be the main driving force behind China's steady economic growth this year, said Wei.

He said China's pledge to accelerate the modernization of its industrial system is encouraging foreign companies to double down on the world's largest manufacturing powerhouse, despite some countries'attempts to decouple from key supply chains.

More than 80 percent of the 600-plus foreign companies surveyed in the first quarter by the Beijing-based China Council for the Promotion of International Trade expect their profit margins from investment in China to stay the same or rise this year.

Over 90 percent of the respondents anticipate their profit margins from investment in China to be stable or increase in the next five years.