This article is a column written by Wang Huiyao, director of the Globalization Think Tank (CCG), for Beijing Youth Daily at the invitation of the Author, published on July 18, 2021.
Over the past 40 years of China's reform and opening up, multinational companies in China have made important contributions in taxation, employment, technological progress, innovation-driven, structural upgrading, market expansion, foreign trade, etc., promoted China's economic and social development and transformation and upgrading, and are an important part of China's economy with vitality and vitality.
In recent years, the growth rate of China's actual use of foreign capital has risen steadily, becoming the world's second largest FDI country for four consecutive years. In 2020, China's actual use of foreign capital reached US$144.37 billion. According to the statistics of the Ministry of Commerce, from January to June this year, the actual use of foreign capital in the country was 607.84 billion yuan, an increase of 28.7% year-on-year, and an increase of 27.1% over the same period in 2019. By the end of 2019, the number of multinational companies investing in China has exceeded 1 million, and more than 490 of the world's top 500 companies have invested in China, and more and more multinational companies are taking China as an important part of their implementation of the globalization strategy.
Under the epidemic, the enthusiasm of multinational enterprises to invest in China has not diminished, mainly due to the long-term optimism about the Chinese market environment. China's gross domestic product (GDP) grew by 7.9 percent in the second quarter, up 3.2 percent year-on-year, showing the strong resilience and great potential of the Chinese economy, according to the National Bureau of Statistics. The scale of 1.4 billion people, the complete industrial chain and supporting facilities, the continuous improvement of the business environment, the application and leading advantages of new economic fields such as digital economy and artificial intelligence, and the efficient prevention and control of the epidemic highlight the stability of the Chinese market also reflect the relative advantages of the Chinese market.
A few days ago, CCG and representatives of 19 multinational companies from the United States, Europe, Japan, India and other countries conducted closed-door exchanges on the operation and development of multinational companies in China under the epidemic situation and the international and domestic political and economic situation. Overall, foreign companies seek to increase investment in China and gain more market share, but pan-politicization such as international tensions and economic, cultural and technological issues has also exacerbated the uncertainty of the living environment of foreign enterprises.
In the past 40 years of China's reform and opening up, multinational companies in China have made important contributions in taxation, employment, technological progress, innovation-driven, structural upgrading, market expansion, foreign trade, etc., promoted China's economic and social development and transformation and upgrading, and are an important part of China's economy with vitality and vitality.
At the same time, multinational enterprises, while enhancing cross-border exchanges such as personnel and trade, have also brought ties between countries closer, which is one of the cornerstones of friendly and stable relations between countries. In the future, to promote the construction of a new development pattern of double circulation and promote high-quality economic and social development, it is still necessary to play a role in the innovation of multinational enterprises, which can provide a more fair and open business environment for multinational enterprises in China.
First, the central and local governments can provide more support in the implementation of open policies, a fair business environment and preferential policies for enterprise development. At present, the Ministry of Commerce has established a foreign complaint center, which can advise and guide foreign enterprises to the foreign complaint center to deal with relevant matters and timely feedback the results of the handling to help them understand relevant policies. At the same time, in the process of landing relevant opening policies such as the Foreign Investment Law, RCEP, and free trade zones, we should pay attention to improving supporting measures, periodically verify the implementation of policies and gradually eliminate or correct existing policies that contradict the new policies, and accelerate the creation of a stable, fair, open and transparent international market-oriented rule-of-law business environment by improving intellectual property rights, formulating industry roadmaps, and forming a closed-loop mechanism for feedback from the demands of foreign-funded enterprises.
Secondly, industry associations can better reflect the needs of multinational enterprises and provide more channels for them to speak out and participate in the formulation of industry standards and related policies. Industry associations are usually an important link between the government and enterprises, and play an important role in understanding the needs of various enterprises in the industry, regulating the development of the industry, serving related member enterprises, interpreting policies and reflecting relevant opinions and suggestions to the government. National and local industry associations should treat all kinds of enterprises fairly, so that multinational enterprises can get more sense of integration and participation through industry associations, and help create a fairer business environment.
At the same time, multinational enterprises can also make more efforts in assuming corporate social responsibility, enhancing their innovation capabilities, and improving the crisis management mechanism. The development of multinational enterprises in China must first understand and respect China's sovereignty and development interests, and can establish a good corporate brand image by better shouldering corporate social responsibility and participating in telling the Chinese story experienced by multinational enterprises. The uncertainty of the international environment will indeed affect the security and stability of the industrial chain of multinational enterprises, but for multinational enterprises to continuously enhance their ability to innovate and focus on making themselves stronger and bigger, it should always be the first. At the same time, crisis multinational companies that speak out in the face of uncertainty should also strengthen the analysis of the international and domestic policy situation and improve the crisis early warning and response capabilities.
Multinational enterprises are one of the glues of inter-State relations. In the context of the more complex international environment facing China, by creating a better business environment to attract more multinational enterprises to develop in China, the friendly and stable development of Sino-foreign relations can have more focus, and at the same time, it can also take advantage of the relative competitive advantages of multinational enterprises to promote the high-quality transformation and development of China's economy and society.
This article was published in Beijing Youth Daily, July 18, 2021
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