"Foreign investment withdrawing from China" is perhaps the biggest cognitive bias

In recent years, every once in a while, there has been a lot of talk about "multinational companies leaving China", but according to researcher and former mayor of Chongqing, Huang Qifan, many voices lack authoritative data to support them.

Huang Qifan said at the recent 1,000-person conference of China's healthcare industry leaders and the 4th Boao Health Forum (Boao Health Forum) hosted by GE Healthcare in Hainan that China's foreign investment has shown a clear upward trend over the past decade, a statement that seems to contradict the general impression of the public.

There are often voices on the Internet that under the action of various factors, the stock of foreign capital in China has been halved, and the annual new foreign investment has almost halved. Many people believe that during the global epidemic prevention period from 2020 to 2022, foreign investment will inevitably decline, because the epidemic has limited the number of overseas visits and joint venture negotiations. Huang Qifan pointed out: "During these three years, China has introduced an average of 170 billion US dollars of foreign investment per year. ”

According to the data, from China's accession to the WTO in 2000 to 2010, the average annual introduction of foreign investment was about 120 billion US dollars, and in the decade from 2012 to 2022, the average annual foreign investment introduced was about 140 billion US dollars, of which 2022 became the year of the largest introduction of foreign investment in the 40 years of China's reform and opening up, with a total of 188 billion US dollars.

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Yijian Finance noticed that Huang Qifan's views are highly consistent with the latest official data.

According to data from the Ministry of Commerce, in the first quarter of this year, there were 12,000 new foreign-funded enterprises in China, up 20.7 percent year-on-year, and China's foreign direct investment amounted to 301.67 billion yuan, up 41.7 percent month-on-month.

In terms of industries, in the first quarter of this year, the actual use of foreign investment in the manufacturing industry reached 81.06 billion yuan, of which the investment in the high-tech manufacturing industry reached 37.76 billion yuan, while the investment in the medical equipment manufacturing industry increased by 169.7%.

In the view of Yijian Finance, this is a very amazing data, and it is also in line with the actual situation of some multinational medical equipment companies "heavy positions in China".

Zhang Yihao, Executive Vice President, President and CEO of GE Healthcare, said at the Boao Health Forum that as early as 2019, GE Healthcare put forward the strategy of "full domestic production", and currently has six bases in China (including seven factories), and has built domestic capabilities from inclusive to high-end.

Not only that, but the company has also invested a huge amount of R&D strength in China, with about 1,800 R&D engineers working on new products in Yizhuang, Wuxi, Shanghai and other places in Beijing, and the team has developed 120 innovative products in the past decade.

Recently, Zhang Yihao told the media: "If you believe in the potential of the Chinese market, the resilience of China's supply chain, and the innovation ability of China's R&D team, then our decision is actually very clear. When others hesitate, our best chance is ours. ”

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Generally speaking, in a country's economic cycle, the proportion of import and export trade in GDP is more than 60% of the external circulation as the main body, and the proportion within 40% is the internal circulation as the main body.

Since the reform and opening up, the characteristics of China's economic operation have also developed from the external circulation of "two ends of the outside, large entry and big out" to a new development pattern of "internal circulation as the main body and domestic and international dual circulation promoting each other".

In Huang Qifan's view, although the global industrial chain and supply chain have been affected by some shocks in recent years, foreign investment in China has increased instead of falling, and the core reason is that China's "internal circulation" has formed a super-large-scale market advantage.

The scale of the domestic medical market alone has grown rapidly in recent years.

According to recent data released by the Medical Device Supply Chain Association of the China Federation of Logistics and Purchasing, the size of China's medical device market will increase from 623.5 billion yuan in 2019 to 1.25 trillion yuan in 2023.

Yijian Finance learned from the "Boao Health Forum" that the private medical industry has now shown a development pattern of a hundred flowers, competing with public hospitals, developing and growing in their respective fields, and forming their own characteristics and competitiveness.

In the past few years, Hygeia Medical Group, which has expanded its medical territory through mergers and acquisitions and self-construction, has become the largest oncology medical group in China; Sanbo Brain Hospital Management Group has been in business for more than 20 years and successfully landed on the Growth Enterprise Market last year; and Celebrity Health, which focuses on health examination services, has established two major physical examination brands, "Celebrity Health" and "Jiaci Physical Examination", relying on the group's more than ten years of development experience and guided by the increasingly diversified health needs of customers, providing hundreds of thousands of customers with health examinations, health assessments, health management, One-stop services such as traditional Chinese medicine health care and medical green pass have now developed into a large-scale health service chain enterprise.

Wu Jiaxiang, president of Celebrity Health Industry Group, said in an interview with Yijian Finance that throughout the "14th Five-Year Plan" period, the country attaches great importance to the medical industry.

For multinational companies like GE Healthcare, the booming private healthcare market in China provides fertile ground for sustainable growth.

Dai Hongdong, Vice President and General Manager of GE Healthcare China, also said at the Boao Health Forum that GE Healthcare is the first company in the industry to set up a dedicated team for non-public medical services, and the most important thing is to see the potential of China's private healthcare market.

In the view of Yijian Finance, many multinational companies have tasted the sweetness in China, and at the same time, they have also benefited domestic companies in the relevant industrial chain.

Huang Qifan also said at the conference that GE Healthcare's continuous investment in China over the years can also be seen from the recognition of China's business environment and investment benefits by multinational companies.

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Foreign enterprises are an important part of China's non-public economy, no less important than private enterprises, and have an important impact on the mainland's export trade.

Previously, the General Administration of Customs released a set of data that in the first half of 2021, the import and export of foreign-invested enterprises was 6.61 trillion yuan, accounting for nearly 4% of China's total import and export value.

"Under the guidance of the new pattern of internal and external dual circulation, China's foreign economy has achieved good trend, structural and fundamental changes in the structure of export products, processing and manufacturing methods, and the total amount of foreign investment. Huang Qifan shared at the "Boao Health Forum" that the export volume of mechanical and electrical products has increased from more than 900 billion US dollars in 2010 to more than 2.7 trillion US dollars, an increase of nearly three times. Behind the growth is the comprehensive cost of China's manufacturing industry that has been greatly reduced under the effect of scale effect, which has made the export of capital-intensive, technology-intensive and equipment-intensive products have huge international competitiveness.

According to Yijian Finance, GE Healthcare's Beijing base accounts for 50% of Beijing's export share of medical equipment in related fields. At the same time, GE Healthcare's Shanghai Diagnostics Plant not only undertakes 60% of GE Healthcare's global production of contrast media, but also ranks first among Shanghai's medical device exporters for many years.

In fact, in order to better attract foreign investment, China has spared no effort over the years, and even more so this year.

On February 23, the executive meeting of the State Council presided over by the premier proposed to stabilize foreign investment as an important force for doing a good job in this year's economic work.

On March 24, shortly after the conclusion of this year's National People's Congress and the National People's Congress, China interacted with executives of multinational corporations at a very high level, and the premier attended the opening ceremony and delivered a speech at the China Development Forum held on the same day, which was the highest-level leader to deliver a keynote speech since the establishment of the forum in 2000.

In addition, the total number of central and local officials attending the forum increased from 30 last year to 34, including 2 ministerial-level officials to 13, and the number of foreign executives invited to attend the forum also increased to 82, 13 more than last year.

Many executives of foreign-funded enterprises have also become "guests" of high-level officials.

Chinese Ambassador to the United States Xie Feng said in an interview with US media on April 5 that what people should be worried about is not whether China's economy will "peak," but whether they will miss out on the new huge "China opportunity."