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From the beginning of the month when the Ministry of Commerce allowed the establishment of wholly foreign-owned hospitals in Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen, and the entire Hainan Island, to the end of the month when the Ministry of Industry and Information Technology officially launched the expansion of the pilot program for the opening up of value-added telecommunications services in Beijing, Shanghai, Hainan, and Shenzhen, and then to the recent visits of multiple multinational company executives, including Apple Inc. from the United States and Investor AB from Sweden, to China and their exchanges with leaders of the Ministry of Commerce... A series of opening-up policies are transforming into strong gravitational forces, driving foreign-invested enterprises to deeply integrate into the Chinese market.

Optimize the investment structure and more diversified sources

The data released recently by the Ministry of Commerce shows that in the first three quarters of this year, the number of newly established foreign-invested enterprises nationwide increased by .%; the actual utilized foreign capital amounted to 100 million yuan, a decrease of .%. How should we interpret the increase and decrease in the data? Industry experts analyze that although the actual utilized foreign capital has decreased year-on-year, the number of newly established foreign-invested enterprises is growing, which is not unrelated to the global investment trend.

In recent years, the total amount of global cross-border investment has shrunk, characterized by a shift towards services and light assets. From the perspective of China, in the first three quarters, the proportion of newly established foreign enterprises in the service sector reached %, an increase of . percentage points compared to the previous year. The investment scale of service sector enterprises is significantly smaller than that of manufacturing, aligning with the global trend in cross-border investment.

From an industry perspective, the proportion of foreign direct investment (FDI) actually used in high-tech manufacturing during the first three quarters increased by . percentage points compared to the same period last year. Among them, investment in the manufacturing of medical instruments and equipment as well as in the computer and office equipment manufacturing sectors grew by .% and .%, respectively. This data reflects a continued positive trend in foreign investment growth in key areas such as manufacturing and services in China. The structure of foreign investment in China is continuously optimizing. Meanwhile, multinational companies are also adjusting their investment layouts in some highly competitive fields.

Data shows that in the first three quarters, foreign investment in China's automobile manufacturing and textile and apparel industries declined by .% and .%, respectively. Another notable characteristic is the diversification of sources of foreign investment in China. In the first three quarters, investment from some developed economies in China continued to grow, such as Germany's investment in China increasing by .%; at the same time, some emerging economies also increased their investment in China, such as ASEAN's investment in China growing by %, and Saudi Arabia's investment in China increasing by .%. This is related to the rising complexity, severity, and uncertainty of the external environment.

Analysts believe that the intensification of geopolitical conflicts, the implementation of protectionism and unilateralism by some Western countries, and the introduction of restrictions on investment in China have increased their impact on China's foreign investment attraction. Data shows that in the first three quarters, the scale of investment from Western developed economies in China generally showed a downward trend, with overall investment from the US, Europe, Japan, and South Korea declining by %. Overall, the decline in the scale of attracting foreign investment is the result of a comprehensive impact from various economic and non-economic factors.

In addition to the macro environment, experts point out that there are other factors to be mindful of. From a long-term perspective, foreign investment, especially greenfield investment, often involves a lengthy process, from project negotiation and signing, to the establishment of enterprises, construction, and eventual production, sometimes lasting for several years, which results in a lag in the actual utilization of foreign capital data. From a short-term perspective, the high interest rate differential between domestic and international markets has objectively slowed the inflow of international capital. However, it is noteworthy that reinvestment of retained earnings by multinational companies in China has become more common, reflecting the confidence of foreign enterprises in deeply cultivating the Chinese market.

Recent surveys by some institutions have fully validated this point. A recent survey by the American Chamber of Commerce in South China showed that 90% of the surveyed companies expressed optimism about their development in China. The survey report by the US-China Business Council also indicated that nearly all the surveyed companies considered the Chinese market a key part of their global layout. Multinational companies remain optimistic about the long-term development prospects of investing in China and have a strong willingness to deepen their presence in the Chinese market.

Creating a Better Environment to Address the Urgent and Difficult Issues of Foreign Enterprises

The Third Plenary Session of the 20th Central Committee of the Party made new arrangements for deepening the reform of the foreign investment management system. The Ministry of Commerce and other relevant departments have actively taken action to continuously promote the implementation of related work. In terms of relaxing foreign investment access, the Ministry of Commerce revised and released the "Special Administrative Measures for Foreign Investment Access (Negative List) (Year Edition)", fully lifting restrictions on foreign investment in the manufacturing sector. It also issued work notices in conjunction with relevant departments, conducting pilot openings in the fields of biotechnology and wholly-owned hospitals in certain regions. Additionally, the revision of the "Catalogue of Industries Encouraging Foreign Investment" was initiated, guiding foreign investment to flow more into high-tech sectors as well as the central, western, and northeastern regions.

In terms of enhancing service support, the Ministry of Commerce has continuously deepened regular exchanges with foreign-invested enterprises. This year alone, it has held roundtable meetings with foreign-invested enterprises, coordinated the resolution of over issues faced by these enterprises, and strengthened comprehensive element support for key foreign-invested projects and landmark foreign-invested projects. The Ministry of Commerce has also continuously provided in-depth interpretations of opening policies such as the "Foreign Investment Regulations" and cross-border data flows, ensuring that foreign-invested enterprises fully grasp investment opportunities in China.

In the third quarter of this year, the Ministry of Commerce held special sessions on large-scale equipment renewal and consumer goods trade-ins, as well as roundtable meetings on promoting key foreign-invested projects, where they interpreted policies and responded to the issues and suggestions raised by enterprises, together with representatives from relevant departments. "In building the 'Invest in China' brand, the Ministry of Commerce has, since the beginning of this year, jointly organized with relevant departments and local governments more than a dozen 'Invest in China' investment promotion events both domestically and internationally," said a spokesperson from the Foreign Investment Department of the Ministry of Commerce. In the second half of this year, key events have been held, including the 24th China International Fair for Investment and Trade, the Invest in Shaanxi special event, and the "Invest in China - 11th Development Zone Dialogue" held during the Global Digital Trade Expo.

Promoting the construction of open platforms is also one of the key tasks recently pushed forward by the Ministry of Commerce. The Ministry will work with relevant departments and local governments to guide and promote the participation of national economic and technological development zones in building a new development paradigm. The Ministry will also advance the comprehensive pilot program for expanding the opening-up of the service industry, research and launch a new batch of pilot measures, and increase the efforts in opening-up and innovation in areas such as value-added telecommunications, healthcare, digital economy, culture and tourism, transportation, commercial aerospace, and characteristic consumption, as well as fashion consumption.

Extension: Profit Reinvestment Foreign Enterprises Demonstrate Confidence with "Real Gold and Silver"

"Many German companies are reinvesting profits into the Chinese market to further expand their businesses, demonstrating long-term confidence in the Chinese economy and ongoing strategic planning. Dennis Deppe, Co-President of the Global Management Board of Roland Berger, a German management consulting firm, stated in an interview that the Chinese market is crucial for the survival and development of German companies, occupying a central position in their global strategies."

In fact, it's not just German companies. Eli Lilly recently announced an investment of one billion yuan to upgrade its Suzhou factory to increase production capacity, and established a China Medical Innovation Center in Beijing; McDonald's China's 1,000th certified green restaurant opened in Beijing, with plans to open over 100 new restaurants in Suzhou in the next few years; Endress+Hauser Group from Switzerland expanded its operations in Suzhou with a new factory, planning to invest one billion yuan in the Chinese market over the next few years; Saudi Aramco, after a year of continuous purchasing in the Chinese market, continues its investment momentum this year, recently signing a 10-year cooperation framework agreement with China National Building Materials Group to share opportunities and seek development in the fields of advanced materials and industrial development.

Gerard Gratton, Vice President of Access Control Solutions at the company, expressed after visiting the China International Exhibition on Public Safety Products: "China's intelligent manufacturing sector is advancing towards high-end, intelligent, and green directions. This development not only transforms production methods but also prompts enterprises to comprehensively evaluate every aspect to achieve more efficient operations. This brings new opportunities for business development in China."

China is a significant market in the global strategic layout. We have been deeply rooted in China for many years, consistently committed to establishing mutually beneficial and win-win cooperative relationships to better serve the Chinese market and meet the needs of local customers. Gerard Gratton, in an interview with reporters, stated that the company is not only one of the first to meet the requirements for localized deployment of cloud services management in China but is also working hard to build a strong local partner network and logistics centers in China. The company is dedicated to advancing into the "mobile intelligent era" in the access control field alongside its partners. In his view, China is striving to achieve the "dual carbon" goals and accelerate digital transformation, which are highly aligned with the future development of the company in China. The company will continuously strengthen innovative technologies in promoting low-carbon development and accelerating digital transformation, enabling solutions to be implemented in more application scenarios and achieving win-win outcomes with Chinese partners.

Recently, McDonald's opened its first flagship store in a university with a cube element design concept at Tsinghua University. This is the first McDonald's restaurant in the Beijing market and will also become the first certified green restaurant in McDonald's China. "Centered in Beijing, radiating to Hebei and Shanxi, this restaurant marks a new milestone in our development," said Wang Guangyi, Senior General Manager of Beijing McDonald's. Opening a flagship store in a university is a practice of McDonald's to root itself in the local community, serve the neighborhood, provide delicious food and passion, and create more job opportunities.

Moreover, McDonald's China recently announced plans to open over a hundred new restaurants in Suzhou within the next few years, accelerating its business development and restaurant network expansion in the city. Zhang Yichen, Chairman of the Board of McDonald's China, stated that last year, McDonald's China launched the "10,000-store plan," with the pace of store openings in Jiangsu Province accelerating, resulting in an average of one McDonald's restaurant opening in Jiangsu every day. This year, McDonald's China's new technology R&D center building has also been put into use in Jiangsu, working in tandem with McDonald's China headquarters in Shanghai, serving the company's development in China through the Yangtze River Delta regional innovation network. Additionally, the company will fully utilize digital technology to drive business development, continuously enhancing its industry competitiveness in the digital age.