German companies begin to abandon their country of origin to invest heavily in China

A recent survey by the German Chamber of Commerce in China shows that around 80% of German companies present in the Asian country plan to maintain or increase their investments, highlighting the importance of the Chinese market for its global competitiveness.

The study, carried out between February 22 and March 6, included the participation of 150 companies, including big names such as Siemens, Mercedes-Benz Group, Covestro and Bayer Group, among the more than 2,100 members of the chamber.

The survey also indicates that a small percentage of participants already see Chinese companies as leaders in innovation in their industries, with an expectation of significant growth in this recognition over the next five years.

Maximilian Butek, executive director of the German Chamber of Commerce in China, East China, emphasized the importance of adapting to the growing competition with Chinese companies, both locally and internationally.

The electric vehicle battery and autonomous driving sectors were highlighted as areas of significant opportunity for German advancement.

This optimism is corroborated by the 19.8% increase in German investment in China in the first two months of this year, according to data from the Chinese Ministry of Commerce.

Additionally, executives from companies such as Henkel AG & Co. highlight the growth potential brought by China’s pursuit of green development.

Significant investments, such as Henkel’s research and development center in Shanghai and the construction of a new adhesives factory in Yantai, reflect German companies’ continued confidence in the Chinese market.

At a recent meeting in Munich, Ling Ji, vice minister of commerce and deputy representative for international trade of China, reaffirmed the broad opportunities available to German companies, especially in expanding the digital economy and the country’s green transformation.

China’s shift in focus from quantity to quality in foreign investment has encouraged increased investment in high-tech sectors, in line with China’s industrial restructuring.

The trade relationship between Germany and China remains robust, with Germany being China’s largest trading partner in Europe for 49 consecutive years, and China remaining Germany’s largest global trading partner for eight years.

German investment in China corresponds to 30% of total European Union investment in the country, reiterating the importance of this bilateral relationship.

With information from China Daily