Foreign investors and businesses still have a strong passion to come to Guangdong, despite the influences of the rising costs of production factors, the more severe and complex international situation and the ravaging of COVID-19 around the world, according to a survey conducted by GDToday recently.
The survey invited interviewees from PorCham Greater China, the European Chamber of Commerce in China South China Chapter, KOTRA Guangzhou, Thai Chamber of Commerce in China, and other foreign business organizations. It concluded that through the province’s increasingly convenient foreign investment and trade services, foreign investors are still eager for Guangdong investment information and hope to seize golden opportunities brought by the development of Guangdong- Hong Kong-Macao Greater Bay Area (GBA), especially in Hengqin, Qianhai and Nansha cooperation zones.
[Photo: Nanfang Daily]
Since the beginning of this year, Guangdong has introduced a series of measures to further protect the rights and interests of foreign investors in the province, facilitate cross-border investment and trade, and to constantly optimize its business environment. In the meantime, Guangdong has spared no efforts to publicize the latest investment information, including the bi-lingual 2022 Invest Guangdong, to foreign investors at home and abroad.
The official data show that Guangdong’s actual foreign investment reached 97.23 billion RMB in the first six months of 2022, with 6,158 newly-established enterprises receiving foreign direct investment.
Great expectations for the future development of GBA
In June, China issued an overall plan for Nansha district in Guangzhou to deepen comprehensive cooperation between Guangdong, Hong Kong and Macao, after the Hengqin and Qianhai Plans released last September. The plan has caught the attention of many foreign institutions, investors and businesses. And Dário Silva, Founder & President of PorCham Greater China is one of them.
Silva told GDToday that the development of the business environment (in Guangdong) has been astonishing recently. There are many preferential policies for foreign investors.
“With the promulgation of the Hengqin plan and the various financial services platforms between China and Portuguese-speaking countries, Guangdong will attract more and more large Portuguese companies to set up their Asian operation headquarters.”
117 member businesses from PorCham Greater China received the latest 2022 Invest Guangdong and most of them found it useful. Several members commented the contacts for several government departments is extremely convenient.
“I think the overall contents are good, and only suggest that special policies in areas such as Huangpu or Nansha should be added as they have very beneficial incentives for foreign investments,” he said.
[Photo: Nanfang Daily]
According to the Business Confidence Survey 2022 (BCS), conducted by the European Chamber of Commerce in China South China Chapter in partnership with Roland Berger, although doing business in South China is still challenging, a majority (58 percent) of members view the development of GBA positively. And 63 percent recommend that more information on the GBA be published in English and Chinese, while 62 percent want the opportunities available under the GBA to be properly clarified.
“Guangdong has a large economic volume, a complete industrial package, a wide consumption space, a dynamic market mechanism, a high level of openness, and a clear trend of transformation, upgrading and leading development,” said Naren Pillai, vice president of European Chamber, South China Chapter and Regional Director of Aden South China Area.
Pillai stressed that with the further integration and development of GBA, foreign investment in Guangdong will be more concentrated in advanced manufacturing, modern services, high technology, energy conservation and environmental protection, green and low-carbon, digital economy and other emerging areas in which Guangdong has advantages.
Further trade facilitation with RCEP countries
In the first half of this year, ASEAN was the largest trading partner of Guangdong. The province saw its foreign trade volume with ASEAN reach 617.56 billion RMB, representing an increase of 4.9 percent year on year and accounting for 15.8 percent of the province’s total.
Since RCEP entered into force on January 1, it has brought tax benefits to the province’s 14.4 billion RMB worth of exported and imported goods. Among them, goods that enjoy favorable tax cuts are mainly exported to countries including the Republic of Korea (ROK), Thailand, Japan and Australia.
[Photo: Nanfang Daily]
Currently, there are more than 1,000 Korean-funded enterprises in Guangdong, which are specialized in the high-end industry of semiconductors and display screens as well as the manufacturing industry of automobiles, mechanical and electrical products.
According to KOTRA Guangzhou, many businesses from the ROK are very interested in the investment policies and services in the guidebook that can facilitate their business operations in Guangdong.
Some member businesses of Thai Chamber of Commerce in China also feel the same way. They also said that they can learn more about Guangdong’s latest development and investment opportunities through the guidebook.
“What Thai-funded businesses expect are more favorable polices in terms of trade, people-to-people exchanges and cross-border financing. Through international consumption platforms in the GBA and under the support of various local trade facilitation programs, I hope that the economic cooperation between China and Thailand can be further promoted,” said Dr. Phaichit Viboontanasarn, vice chairman and secretary-general of Thai Chamber of Commerce in China.
Foreign trade and investment to be resilient in H2
From the various regulations on enhancing business environment to the release of an investment guidebook, Guangdong has become increasingly appealing in the eyes of foreign investors and businesses.
ABB is one of them. For example, on August 9, ABB E-Mobility Technology Shenzhen Co., Ltd inaugurated its head office at the Xili Lake International Science and Education City, an innovative hub in Nanshan District, Shenzhen.
[Photo: Nanfang Plus]
Frank Mühlon, CEO of ABB E-mobility, said that Shenzhens high-quality resources and environment have created a great opportunity for ABB to expand its e-mobility market in the city. In the future, ABB E-Mobility will continue to increase investment in Shenzhen and China and live up to its long-term commitment of “In China, for China and the world”.
FedEX, one of the worlds largest express transportation companies, is also full of confidence in the market of Guangdong.
In late July, the company announced that it has signed an agreement with Guangdong Airport Authority Logistic Company to expand and upgrade FedEx Guangzhou Gateway by establishing a new FedEx South China Operations Center in Guangzhou.
“Our new operations center will be another important facility and regional center in China. Our investment in the South China Operations Center demonstrates our confidence in China’s economy and supports the country’s efforts to build a ‘dual circulation’ development pattern with smooth supply chain services,” said Eddy Chan, senior vice president of FedEx Express and president of FedEx China.
In terms of further optimizing the business environment, Bai Ming, deputy director of the international market research institute under Chinas Ministry of Commerce, suggested that the government should continue deepening reforms to streamline administration and improve government services so as to provide foreign investors and businesses with better services.
Moving forward, despite many uncertainties brought by the pandemic, “we are still confident about the economic development of Guangdong in the second half of the year. Its foreign trade and investment attraction will maintain its resilience regardless of various challenges ahead,” he said.
Driven by the major investment projects, demand growth, and industrial development, businesses will boost their market confidence. Thus, the economic potential of Guangdong will be fully unleashed in the second half of the year, according to some experts.