Foreign investment is still promising in China amid an economic slowdown with new opportunities emerging from consumption and service in the domestic market, a Xinhua investigation has found.
“The closure of low-end export-oriented OEM manufacturers has eliminated outdated capacity and offers room for more quality programs,” said Fang Jianbo, deputy head of the commerce bureau of Dongguan, a southern Chinese city in Guangdong province dubbed the “world’s factory” and a barometer for the country’s economic changes.
Some 362 foreign enterprises were shut down or relocated in 2015, accounting for 3.3 percent of the total number of foreign firms in the city. Most of the firms were labor-intensive manufacturers, said Fang.
Meanwhile, 440 new foreign-funded projects were signed last year in the city with a total investment of $ 5.06 billion, up 17 percent year on year, mainly in sectors of financing, logistics, medicine and high-end manufacturing, he said.
Eyeing the vast Chinese market, UMC, a global semiconductor foundry, started an integrated circuit manufacturing program in Xiamen City, east China’s Fujian province last year with a total investment of $ 6.2 billion.
There is an obvious trend that the OEM firms that only take China as a production base are struggling for survival while those manufacturers that take China as a sales market are expanding their businesses, said Harley Seyedin, president of the American Chamber of Commerce in South China.
About 80 percent of its members provide products and services solely for the Chinese market, up from 23 percent in 2003, said Seyedin.
China attracted a total of $ 126 billion of foreign capital in 2015, up 5.6 percent over the previous year, with service and high-end manufacturing sectors attracting over 70 percent of the total, according to the Ministry of Commerce.