China's "Engine" Boosts Global Development Confidence

On September 17th, Reference News Network reported that since the beginning of this year, against the backdrop of global economic fluctuations and a more complex and severe external environment, the Chinese economy has continued to recover and overall rebounded. Our reporter recently interviewed many foreign-funded enterprises and foreign experts to learn that foreign investment is deeply rooted in the Chinese market, and their confidence is not diminished. They continue to increase their investment in China, casting a "vote of trust" for the Chinese economy through practical actions. The Chinese economy has strong resilience, great potential, and abundant vitality. Its long-term positive fundamentals have not changed, and it remains an important engine of global economic growth.

The rebound of the Chinese economy injects momentum into the global economic recovery

On September 2, 2023, the opening day of the China International Fair for Trade in Services, Tesla's new Model 3 made its debut at the booth, marking the world's debut. In just a few days, Tesla's Shanghai Superfactory's second millionth vehicle slowly drove out of the production line.

In the first half of this year, Tesla announced an increase in investment and will build a new energy storage super factory in Shanghai. "We expect to build an energy storage super factory in the near future, and our products will mainly be used for export," said Tesla China President Wang Hao.

The latest financial reports released by many foreign investors show that the performance of the Chinese market is still impressive. For example, the net sales of Wal Mart in China in the second quarter increased by 21.7% year on year, and the Chinese market of SKECH in the second quarter increased by 19%. "We have a long-term positive outlook on the Chinese market and value Chinese investment," said Chen Weili, CEO of SKECH China, South Korea, and Southeast Asia.

The confidence of foreign investment in the Chinese market stems from the strong resilience and potential of the Chinese economy.

In the first half of this year, China's economy grew by 5.5% year-on-year, and its economic recovery rate is leading among major economies in the world. Entering July, although the growth rate of some economic indicators has fluctuated, the overall trend continues to recover and improve. Since August, some economic indicators such as the China Manufacturing Purchasing Managers Index, China Commodity Index, and China E-commerce Logistics Index have continued to rebound, and the momentum for economic recovery has increased.

Torrens, Vice President of the British Chamber of Commerce in China, stated that in the year following the weakened impact of the pandemic, China's economic performance met expectations, and the consumer index has rebounded, with the economy continuing to consolidate and rebound.

The changes in financial market indicators also confirm Torrance's judgment.

According to a recent report by the Financial Times, Chinese bank stocks have actually risen by 2.4% in the past year. In US dollars, Bank of China's performance is actually 12.6% better than Bank of America's.

The performance of Chinese government bonds is also significantly better than that of US treasury bond bonds, which are regarded as traditional safe haven investments. Since January 1, 2020, the return on long-term Chinese government bonds has been 17.1%, while the return on long-term US treasury bond has been -13.4%. At the same time, the prices of bulk commodities such as iron ore in China are still rising.

The latest data from the People's Bank of China shows that credit growth is good, overall exceeding market expectations, with new loans reaching a historical peak for the same period. In August, RMB loans increased by 1.36 trillion yuan, an increase of 86.8 billion yuan year-on-year; At the end of August, the balance of broad money was 286.93 trillion yuan, a year-on-year increase of 10.6%; According to preliminary statistics, the increase in social financing scale in August was 3.12 trillion yuan, an increase of 631.6 billion yuan compared to the same period last year. The continuous increase in financial support for the real economy has effectively boosted market confidence.

The opening customers of chain supermarkets plan to open the sixth store in Chinese Mainland this autumn, the skin care brand Malingots will open 10 Kate Speer stores in Chinese Mainland, and Medtronic, a famous medical technology company, will sign a contract with Pudong New Area of Shanghai to launch Medtronic China Phase II venture fund

International observers believe that the economies of all countries in the world have been impacted to varying degrees during the COVID-19 epidemic, and the performance of many multinational companies has been damaged. However, China's supporting industries are comprehensive and the economy is resilient. Most foreign-funded enterprises in China still regard China as the main strategic market.

The 2023 World Investment Report recently released by the United Nations Conference on Trade and Development shows that China's foreign direct investment return rate in the past five years has been 9.1%, much higher than Europe and America's around 3%, and also higher than emerging economies such as Brazil, South Africa, and India's 4% to 8%. The latest report from the China Council for the Promotion of International Trade shows that over 80% of foreign companies surveyed expect their investment profit margin in China to remain unchanged or increase this year.

"The Chinese business can effectively offset the impact of high energy costs in Europe and other factors," said Bo Mule, Chairman of the Executive Board of BASF, a German chemical giant.

Since the second quarter, international organizations and institutions such as the World Bank and the OECD have raised their expectations for China's economic growth this year. The International Monetary Fund released its latest World Economic Outlook report in July, predicting that China's economy will grow by 5.2% this year, contributing one-third of the world's economic growth. The China Economic Observer report released by KPMG for the third quarter of 2023 indicates that the Chinese economy is expected to achieve a growth rate of 5.5% in 2023.

The President of the World Economic Forum, Borg Brend, stated that many measures taken by China have supported economic growth, and a survey by the World Economic Forum shows that business people are full of expectations for opportunities in the Chinese market after the pandemic.

China's new development provides new opportunities for the world

This year, Schneider Electric's Electric China Automation R&D Center in Wuxi, Jiangsu was officially opened, making it the fifth largest R&D center established by Schneider Electric in China. "China has become Schneider Electric's second largest market and one of the four research and development bases globally." Yin Zheng, Executive Vice President and President of China and East Asia, stated that Schneider Electric will continue to increase innovation investment in the future, continuously launch digital green innovation technologies, solutions and services, and empower China's industry to accelerate transformation and upgrading.

It is a trend for foreign companies to establish research and development centers in China. Since the beginning of this year, the R&D center of Thermo China and the global refrigeration R&D and testing center of Danfoss Group have successively been put into use. The high-end clothing and care brand THE LAUNDRESS under Unilever has recently set up an Asian R&D center in Tianjin.

"China has become one of Qualcomm's largest markets and innovation bases globally," said Qian Kun, Senior Vice President of Qualcomm Global. Qualcomm will continue to integrate with related industries in China and jointly develop more digital economy new ecosystems such as the Internet of Things and intelligent connected vehicles.

In the context of a generally sluggish global cross-border investment, foreign investment is actively expanding into high-end industries and emerging fields in China, and is optimistic about the prospects for high-quality development of the Chinese economy. In the first seven months of this year, the actual use of foreign investment in China's high-tech industry increased by 3.8% year-on-year, with the high-tech manufacturing industry growing by 25.3%.

Mohammad Luta, President and CEO of the Dubai Chamber of Commerce, stated that China's economic growth foundation is solid, supported by a strong manufacturing and talent pool, which is crucial for innovation. China has complete infrastructure and strong financial technology capabilities, with rapid development in cutting-edge technologies such as artificial intelligence and the Internet of Things. These competitive advantages are attractive to foreign enterprises.

On August 14, the first Chinese tourist group to visit Cuba after the COVID-19 epidemic arrived in Havana, the capital of Cuba. "To attract more Chinese tourists, Cuba has increased its promotion efforts in natural, cultural, and medical tourism, and is also committed to developing tourism products that cater to the preferences of young Chinese people." said Elizabeth, the tourism counselor of the Cuban Embassy in China who arrived with the delegation.

Nowadays, many countries are eagerly anticipating the accelerated return of Chinese tourists. From the surging crowd and strong consumer demand, the world feels a vibrant China, captures positive signals of China's economic recovery, and has more optimistic expectations for global economic development.

"I have received a lot of orders for the 'Eleven' Golden Week," said Fu Chun, the person in charge of the Flying Fish Diving Center from Indonesia. "I am optimistic about the potential of China's outbound tourism and am also full of expectations for the explosive number of Chinese tourists visiting Indonesia."

The Chinese economy, which is constantly optimizing its economic structure and gathering endogenous driving forces, is moving forward on the path of high-quality development. It is taking advantage of the opportunities in the Chinese market to provide new development momentum for the world, and providing more and better Chinese services for the world through high-quality development.

Traditional handicrafts from Pakistan, special agricultural products from Thailand, carpets and scarves from India, and crystal products from the Czech Republic... At the 14th China Northeast Asia Expo held recently in Changchun, Jilin Province, the "the Belt and Road" national exhibition area attracted a large number of visitors.

Adi, a businessman from Türkiye, has been doing business in China for five years. "It's very cold in the northeast in winter, and my woolen scarf is very popular." Adi warmly introduced woolen products from Türkiye to everyone, and business was booming in front of the booth.

In the first half of this year, the import and export volume of China and the countries jointly building the "the Belt and Road" increased 9.8% year on year, accounting for 34.3% of the total import and export volume. Nepal's ambassador to China Bishnu Schlesta said that the "the Belt and Road" initiative has become a popular international public goods and cooperation platform, opening up new space for world economic growth, and building a new platform for international trade and investment.

"China is a market full of vitality, tension, and potential, and we are full of confidence in new patterns and opportunities," said Li Tao, Vice President of Philips Investment Co., Ltd. in Greater China.

Rooted in the Chinese market, writing a new story of win-win cooperation

Entering the newly opened factory of Ansaibo Group in Tianjin, Belgium, the nearly 7000 square meter airport aviation aid product production and testing workshop is equipped with several production lines, including dimmers, embedded lighting fixtures, and signage, operating at full capacity.

"Our products are widely used in large and medium-sized airports in China, and are also exported to countries and regions such as the United States and Belgium. After the new factory is put into operation, the production line is further optimized, and the overall production capacity of the company is expected to increase by 35% this year." said Yang Xinyu, Vice President of Operations for Ansaibo Group in China.

Thousands of miles away, in Sanya, Hainan, PwC's "Future Space" project is intensifying construction. The project is planned to invest over 1 billion yuan and is the first park construction project invested by PwC in China.

Starbucks and McDonald's are accelerating the opening of branches in China, Tesla is upgrading and expanding its super factory in Shanghai, AstraZeneca has signed an investment cooperation agreement with Qingdao High tech Industrial Development Zone, BMW's sixth generation power battery project is fully underway in Shenyang, and Airbus is building a second production line in Tianjin

Against the backdrop of insufficient global economic growth momentum and a slowdown in global trade growth, the steadily growing Chinese market remains a hot spot for attracting foreign investment.

According to a recent report released by the British Chamber of Commerce in China, 86% of British companies are optimistic about the long-term potential of the Chinese market. According to the 2023 Business Confidence Survey of the European Chamber of Commerce in China, over 90% of surveyed companies plan to use China as their investment destination, with 59% of them considering China as one of the three major investment destinations.

Hong Kong's Asia Weekly recently published an article stating that although mainstream Western media is singing down the Chinese economy, the true trend of American companies expanding their investments in China reflects the resilience of the Chinese economy.

In Shanghai, with more than a month left until the opening of the 6th China International Import Expo, the number of Fortune Global 500 companies and industry leaders who have signed up to participate has exceeded last year. Many exhibitors will continue to launch the world premiere. For example, Hikscon will display the latest industrial Internet platform, and SGS will launch three new products, namely, gold label certification, hydrogen label, and online monitoring service for quality, intelligence, Runwei oil.

"China is the 'stabilizer' of the world economy and the 'accelerator' of the global consumer market. Investing in China is investing in the future." Jean Paul Angong, Chairman of L'Oreal Group in France, said that L'Oreal has continuously participated in the CIIE, transforming multiple innovative products from 'exhibits' to' commodities', and the group has also transformed from exhibitors to investors.

Faced with many challenges such as weak global economic recovery, persistent global inflation, and financial market turbulence, adapting to the trend of globalization and promoting mutual benefit and win-win is the common expectation of enterprises in various countries.

The 2023 China International Fair for Trade in Services achieved more than 1100 achievements, and the internationalization rate of offline exhibitors exceeded 20%; The 7th China South Asia Expo signed a total of 338 investment projects; The 14th China Northeast Asia Expo attracted 84.475 billion yuan in investment, and the project investment scale reached a new high... Since August, China has held various large-scale international exhibitions as scheduled, injecting momentum into its own economic development and world economic recovery.

At present, China is solidly promoting Chinese path to modernization with high-quality development. The road of Chinese path to modernization is becoming wider and wider, which will better develop itself and benefit the world.

Continue to fully refund value-added tax on the purchase of domestic equipment by foreign-funded research and development centers; Continuously reducing the negative list of foreign investment access; Optimize the residence suspension policy for foreign employees of foreign-invested enterprises and explore a convenient cross-border data flow security management mechanism; Strengthening the guarantee of funds for promoting foreign investment and encouraging foreign-invested enterprises to reinvest domestically... A series of practical measures demonstrate China's firm determination to promote development and win-win through openness.

"We have confidence in an open economy," said Li Xingyu, Executive Director of the Socio Economic Research Center of the Chinese Chamber of Commerce in Malaysia. China is a staunch supporter of opening up to the outside world, adhering to promoting international economic and trade cooperation and high-level opening up to the outside world, which will contribute to global economic development.