Foreign investors eye more opportunities in China’s high-tech industry

Published: February 16,2024

Since the beginning of the year, Volkswagen Anhui’s MEB plant in Hefei City, the capital of east China’s Anhui Province, has been functioning at full capacity to produce new energy vehicles (NEVs) for the European market.

At the advanced factory, around 1,000 robots are assigned to perform various duties and automated guided vehicles carry materials in an orderly manner. At the same time, the industrial CT undertakes highly efficient quality analysis in real time.

With an investment of over 30 billion yuan (about 4.22 billion U.S. dollars), Volkswagen has built a new hub in Hefei that covers the entire value chain from research and development (R&D) to manufacturing, sales and services of NEVs, with 1,200 R&D personnel.

As China is accelerating the development of modern industrial systems and sci-tech innovation, many more enterprises like Volkswagen are prioritizing their investment in high-tech industries and seeking new business opportunities.

In 2023, China’s actual foreign direct investment (FDI), which remained at a historically high level, hit more than 1.13 trillion yuan, according to the Ministry of Commerce.

In November 2023, American biotech company Moderna commenced construction of its first pharmaceutical plant in China, with an estimated investment of 3.6 billion yuan. In the same month, the construction of BMW’s new battery production plant in Shenyang, northeast China’s Liaoning Province, was completed.

This year, China’s high-tech industries are poised to remain focal points for foreign investors.

The country’s top economic planner recently launched a new batch of flagship foreign investment projects, with a planned total investment of over 15 billion U.S. dollars, covering fields including biomedicine, automobile manufacturing, power batteries and chemical engineering.

The upgrading of China’s consumer market and the enhancement of sci-tech innovation have also strengthened foreign enterprises’ willingness to seek new businesses in China, said Wang Yaping, deputy general manager of Deloitte Hefei Branch.

While investing more in high-tech industries, many foreign enterprises began launching R&D centers and building local supply chains rather than just establishing production bases in China.

Recently, Siemens officially opened the R&D center of industrial software in Shenzhen, south China’s Guangdong Province. Last year, Volkswagen announced it would establish Volkswagen China Technology Company, its largest development center outside Germany, in Anhui.

“With our ‘in China for China’ strategy, we will develop much more technology here in the future to make even better use of local innovative strength and respond more quickly to the needs of Chinese customers,” said Erwin Gabardi, CEO of Volkswagen Anhui.

Source: Xinhua