TIANJIN, June 23 (Xinhua) — Commercial compressors came off an automated production line, with a few workers operating the intelligent system and checking quality at Danfoss Smart Manufacturing Factory in north China’s Tianjin Municipality.
Danfoss, a leading Danish heating technology company, made its first investment in China in 1996 by founding Danfoss (Tianjin) Co., Ltd. founded. After more than two decades, the subsidiary has grown into a modern factory integrating research and development (R&D). new product testing and intelligent manufacturing.
Dai Jian, head of Danfoss Global Services, China and general manager of Danfoss (Tianjin) Co., Ltd., said that Danfoss always regards China as its “second home market” with more than 10 manufacturing bases across the country. China is now its second largest regional market and the largest purchasing market.
“We moved a compressor production line from the United States to Tianjin last year. Eight to ten production lines are scheduled to be transferred from Europe to Tianjin this year, and the preparatory work has already started,” Dai said. All the new production lines will bring annual output value of 800 million yuan (about US$119.3 million) to Danfoss Tianjin in the future, Dai said.
Driven by China’s goals to maximize carbon emissions by 2030 and achieve carbon neutrality by 2060, Danfoss has made energy conservation and emissions reduction a key development area in China and continued to increase investment.
In 2021, Danfoss announced it would invest 140 million yuan to build a global refrigeration R&D and testing center in Tianjin. “It is currently our largest R&D center and we expect to have it operational by the end of this year to launch the newly developed products,” said Dai.
In line with China’s development goals, multiple favorable policies and a promising business environment, Dai said these are the main reasons for the company to establish a foothold in China, develop and further increase investment.
In addition to Danfoss, many foreign companies have also set their sights on China’s future development and expanded their business in the country.
Foreign giants such as Fast Retailing, Siemens Healthineers and L’Oreal have opened new stores, increased investments and launched new projects to demonstrate their confidence in China and determination to expand their presence.
In the eastern city of Suzhou, Republic of Korea’s Mando plans to invest over 1 billion yuan in new projects in 2022. In Zhejiang province, Nidec Elesys (Zhejiang) plans to invest another 150 million yuan this year to expand production capacity inverters for new energy vehicles.
According to the 2022 China Business Climate Survey Report released by the American Chamber of Commerce in China (AmCham China), two-thirds of the companies surveyed plan to increase their investments in China this year.
With consumption accelerating in recent years, China’s huge market of over 400 million middle-income people is attractive enough for global investment, said Cong Yi, a professor at Tianjin University of Finance and Economics.
In recent years, China has further reduced the foreign investment blacklist and enacted laws and regulations, including the Foreign Investment Law, to protect the legitimate rights and interests of foreign investors.
Even during the COVID-19 pandemic, China has made great efforts to stabilize industrial and supply chains and ensure the steady progress of large-scale projects, which has further strengthened the investment confidence of foreign companies in China.
Actual foreign direct investment (FDI) in mainland China rose 17.3 percent year on year to 564.2 billion yuan in the first five months of the year, according to the Ministry of Commerce (MOC). In US dollar terms, inflow rose 22.6 percent year-on-year to US$87.77 billion.
During the period, investments from the Republic of Korea, the United States and Germany increased by 52.8 percent, 27.1 percent and 21.4 percent, respectively.
Shu Jueting, a spokesman for the MOC, said in May that multinationals have been actively expanding their investments in China, showing foreign investors’ confidence in China’s economic prospects and also the appeal of China’s vast market, complete industrial system and infrastructure reflected as plentiful staff.
Shu also pointed out that China will further deepen its opening-up and optimize its services to foreign investors to create more opportunities for foreign-funded enterprises.