For French cosmetics giant L’Oreal, an old friend of the annual China International Import Expo (CIIE), China is a « new investment landmark » and « the world’s laboratory for innovation. »
As a participant in the marquee event for six consecutive years, L’Oreal recently invested in China’s biotech startup Shinehigh Innovation to establish a long-term partnership for the co-development of sustainable beauty solutions.
As a landmark step in China’s push for broader opening-up, the CIIE has played a pivotal role in boosting global businesses’ market expansion and investment confidence in China.
With a presence of 26 years in China’s mainland, L’Oreal is one of the multinational companies that have directly engaged with the world’s fastest-growing consumer market through the CIIE, and doubled down on their investment efforts to seek a larger footprint in the country.
Meanwhile, China’s growth as a global hub for manufacturing and research and development (R&D) is also attracting more foreign enterprises to tap into the country’s optimized business environment featuring booming innovation and strong industrial chains.
INCREASED PRESENCE WITH MORE INVESTMENT
« Every year, the CIIE is a big discovery… We would like to witness and support (the) CIIE to become better and better, to be able to cooperate and collaborate on this platform with more clients, partners, and authorities, » said Fabrice Megarbane, president of L’Oreal North Asia Zone and CEO of L’Oreal China.
China is undeniably the incubator for the company’s new ideas and open innovation thanks to its robust, dynamic and unique innovation environment, said L’Oreal Chairman Jean-Paul Agon.
Last year, L’Oreal founded its first investment company in China and started construction for the company’s first global self-built Intelligent Fulfillment Center in the eastern Chinese city of Suzhou. It also plans to build another Intelligent Fulfillment Center in the eastern city of Nantong.
« We believe that investing in China is investing in the future, » said Agon. With a market that is further opened up, an improved business environment and promising domestic demand boosted by initiatives, China is offering the world new opportunities, he said.
China’s continuous holding of the CIIE also allows companies like Bosch Group to better connect with local market demands and gives them more confidence in investing in the country, said Jiang Jian, vice president of Bosch China.
As an exhibitor for the sixth consecutive year, the German engineering and technology giant views the CIIE as « an effective initiative to encourage consumption and expand opening-up, » he added. Every year, Bosch brings consumers its global premiere products covering smart mobility and home appliances. Many have turned into in-demand commodities in the Chinese market.
Currently, Bosch is continuing with their layout in critical fields of smart mobility and electrification in the Chinese market. « Over the past decade, we have invested a cumulative total of more than 50 billion RMB (over 6.8 billion U.S. dollars) in China, » Jiang said.
Earlier this year, Bosch made an investment of around 1 billion dollars in a new R&D and assembly center in Suzhou, which already has four Bosch factories.
With its first phase to be completed by mid-2024, the new facility will develop and assemble core components for new energy vehicles and automated driving to sell primarily to Chinese customers.
« China is the world’s largest auto market, full of promise and vitality. As a multinational enterprise, we need to make full use of the country’s local R&D capability and production capacity, » Stefan Hartung, chairman of Bosch’s board of management, said in an earlier statement.
BOOSTING CONFIDENCE IN THE FUTURE
A vast majority of foreign-funded companies operating in China are optimistic about their development in the country, with over 90 percent of the respondents expecting their return on investment to increase or remain flat in the next five years, revealed a recent survey by the China Council for the Promotion of International Trade.
The survey also showed that foreign firms demonstrate a strong will to expand their business operations in China, as over 70 percent of the respondents said they would further localize their industrial chains in China or maintain the status quo.
During the CIIE, government officials, purchasing groups and exhibitors gathered in Shanghai for extensive exchanges and potential cooperation through high-level dialogues. To attract foreign investment, business trips across China have been arranged for 322 CIIE exhibitors.
« That’s why we always choose the CIIE as the first platform in China to present our new products, new solutions and new initiatives. As a CIIE ‘veteran’, we have witnessed the expansion of the influence and friend circle of the CIIE year by year, » said Gustavo Biscassi, head of external affairs of Brazil’s mining giant Vale.
It is Vale’s sixth time to take part in the CIIE, during which Vale is promoting Mega Hubs for the first time. Mega Hubs are industrial complexes that aim to produce hot briquetted iron (HBI) using natural gas, and can substantially reduce carbon emissions in steel-making.
Biscassi pointed out that China’s continuously optimizing business environment and recent preferential tax and fee policies would further encourage foreign enterprises to increase investment.
Among them, policies halving the urban land use tax for bulk commodity storage of logistics firms will be extended until the end of 2027, which « reduced the storage cost of our iron ore at China’s ports, » Biscassi said.
Zhang Xiqiang, executive vice president of Swiss food giant Nestle, said that « the CIIE marks China’s continued opening-up of its domestic market and efforts to further integrate with the world. »
As a member of the Exhibitor Council of the CIIE, Nestle joined the expo for the sixth consecutive time this year, and regarded the event as « an important measure for China to support trade liberalization and economic globalization. »
The CIIE « practices true multilateralism and builds more open consensus, and thus is particularly valuable for the economic development of today’s world, » said Zhang, also chief executive officer of Zone Greater China of Nestle.
Nestle has invested and developed in China for 37 years. Looking into the future, the company will continue to deepen its exploration of the Chinese market, he said, expressing confidence in China’s long-term development.