GUANGZHOU, China, March 4, 2023 /PRNewswire/ — “Foreign investment in Guangdong is mainly divided into three types: foreign trade-oriented, manufacturing-oriented and service-oriented. Foreign-funded service-oriented enterprises have shown a rapid upward trend in recent years,” Joanne Wang, Guangdong Markets Leader of PwC China, told GDToday and Lianhe Zaobao in a joint interview on high-tech development. quality in Guangdongthe province seen as the economic engine of China.
She took Shenzhen as an example, saying the city’s actual use of foreign investment in the high-tech industry reached $4.5 billion in 2022, or 41 percent of the city’s total. The actual use of foreign investment in the high-tech service industry increased 13% year-on-year, indicating an increase in the quantity and quality of foreign investment.
The manufacturing industry will see a “qualitative breakthrough”
THE Guangdong government pledged to boost high-quality development at a major conference held on January 28the first business day after the Chinese New Year holiday, which indicates a shift in direction from quantitative economic indicators towards sustainable and environmentally friendly growth.
The province highlighted the role of manufacturing in its new round of development and highlighted its 8 industrial clusters with more than 1 trillion in output, including next-generation electronic information, green petrochemicals, appliances smart appliances, advanced materials, modern light industry and textiles, software and information services, modern agriculture and food and automobiles.
“Guangdong OEM service took off 45 years ago and has boosted the province’s foreign trade and overall development for years. Now that Guangdong the manufacturing industry has reached a leapfrog development, it needs a qualitative breakthrough to drive its growth,” said Guo WandaExecutive Vice President of China Development Institute (CDI).
Wang Junformer president of the Guangdong Academy of Social Sciences, analyzed that Guangdong is now boosting the quality of its manufacturing industry by increasing investment in basic research, stating, “This indicates that the province places great importance on original technological innovation.
According to the Department of Science and Technology of Guangdong Province, Guangdong basic research funding represents 4.23% of total research and experimental development (R&D) spending in 2018, which is relatively low nationally. This number increased to 5.87% in 2020 and 7.64% in 2022, and is expected to reach 10% by 2025 and 13% by 2030.
In addition, Wang believes that the electronic information industry, which is a pillar industry of Guangdongwill provide the technologies and industrial facilities needed for smart manufacturing.
Position in global supply chain maintained with shift in focus
To attract investment and boost the economy, emphasis is also placed on efforts to improve the business environment for foreign companies. Guangdong Governor Wang Weizhong said the province will apply national treatment to foreign-funded enterprises and expand their market access.
Joanne Wang explained that policy transparency, government efficiency and tax costs are the three factors that foreign-invested enterprises are most concerned about when evaluating a business environment.
Klaus ZenkelVice President of the EU Chamber of Commerce in China and President of the South China Section of the European Chamber, added that factors such as protection of intellectual property rights, tax incentives as well as green energy supply are essential for foreign companies in terms of sustainable development. and high quality.
Guangdong is developing an action plan to optimize the business environment, addressing issues such as inadequate implementation of policy documents and significant feedback from enterprises, according to Huang Huadong, deputy director general of the commission. development and reform in Guangdong.
Some foreign companies, including Toshiba and Samsung, have relocated their production lines from China For Vietnam, Thailand and other Southeast Asian countries over the past two years, sparking discussions on China change of position in the global supply chain.
Zenkel sees this as a China plus one strategy that has been adopted by most multinational companies, i.e. setting up factories in both China and other countries, to ensure a more flexible and comprehensive supply chain ecology. “Our business confidence survey shows that most companies would like to stay in China and have no intention of leaving the country,” he said.
“China has maintained an important position in the global supply chain and served the global market for a long time with a full range of industries, well-developed infrastructure and numerous industrial professionals. Southeast Asian countries lack these elements, so offshore manufacturers have yet to show particularly good economic benefits,” Joanne Wang said.
Based on the government work report, Guangdong will adopt a new investment promotion model in 2023 and attract domestic and foreign capital across the industrial chain. It will favor highly competitive technological and manufacturing companies.
Wang Jun said that compared to labor-intensive industries such as furniture, clothing and textiles in the 1980s and 1990s, competition and future opportunities lie in high-tech manufacturing and services. Provinces and regions of China are currently making considerable efforts to attract foreign investment in these sectors.
SOURCE GD Today