Beijing remains preferred destination for foreign capital

BEIJING -- As a leading hub of scientific and technological innovation, Beijing will continue to be an appealing destination for foreign investment, actively attracting sci-tech innovation projects and talents and continuously striving to enhance its business environment.

Executives from foreign-funded companies, investors, and government officials made the remarks at the 2023 Invest Beijing Global Summit, a sideline event of the 2023 Zhongguancun Forum held from May 25 to 30 in the city's innovation hub of Zhongguancun, known as "China's Silicon Valley."

During the summit, domestic and foreign companies signed a batch of investment deals worth a cumulative value of over 60.8 billion yuan ($8.61 billion), covering 39 projects in the city's high-tech sectors such as intelligent connected vehicles, medicine and health, and intelligent manufacturing.

A total of 152 investment projects involving enterprise financing, park cooperation, building cooperation, and land financing were also announced during the summit, with a total investment of 143.4 billion yuan.

Beijing has the largest number of regional headquarters of Fortune 500 enterprises and gives priority to development in fields such as services trade, technological innovation, and intelligent manufacturing, said Hubertus Troska, member of the board of management of Mercedes-Benz Group AG responsible for Greater China.

In the past 10 years, the company and its local partners have invested more than 100 billion yuan in China, focusing on expanding local production capacity, strengthening local R&D capability, and building the automotive industry chain, among other key areas.

"I'm confident that Beijing, with its clear commitment to continuing with China's reform and opening-up policy and constantly improving business environment, will remain an attractive choice for foreign investors," said Troska, who has lived in the city for over a decade.

Carl-Alexander Scheef, vice president of Bayer Healthcare Co Ltd China, said that Beijing's efforts in driving reform and opening-up and preferential policies have encouraged Bayer to become one of the first foreign-funded enterprises to settle down in the city.

Local government officials have visited the company's factory in Beijing several times to better understand its development needs. The launch of China (Beijing) Pilot Free Trade Zone in September 2020 has also helped Bayer with a resilient supply chain and speedy customs clearances, giving Bayer more confidence in its future development in Beijing, Scheef said.

Last year, it invested 40 million euros ($43 million) to set up four new packaging production lines in the country, increasing its capacity by at least 40 percent. "It's a big investment because we really believe in the growth of the Chinese market," he said.

"Beijing is one of the first pilot cities in China to carry out the construction of international consumer center cities and the cultivation of innovative business environment," said Sheng Qiuping, China's vice minister of commerce. "We sincerely welcome foreign-funded enterprises to carry out investment in Beijing and continuously expand the cooperation fields."

Beijing has become a hotspot for foreign investment in the country. According to the Beijing Municipal Bureau of Statistics, the actual utilized foreign direct investment was $17.41 billion in 2022, up 12.7 percent over the previous year. Of this total, $6.98 billion was spent on scientific research and technology services, accounting for 40.1 percent of the total.

Beijing has also become a prominent hub for sci-tech innovation in the country, with nearly 100 universities and over 1,000 research institutes. It holds the third position globally in terms of the number of "unicorn" companies, which refer to firms with a valuation of $1 billion or more. Beijing has achieved an impressive feat by securing the top spot in the Nature Index global science city rankings six consecutive times.

Beijing's innovation hub Zhongguancun has attracted over 300 multinational companies to set up regional headquarters and research centers, and more than 130 Fortune Global 500 companies to establish branch offices.

"Beijing has long attached great importance to the development ecosystem of the venture capital industry, providing sufficient talent reserves for cutting-edge sci-tech innovation and rich scenarios for technology application," said Zhou Kui, partner of investment firm Sequoia China.

Of the Beijing-based companies that it has invested in, 50 have completed initial public offerings and 43 have become "unicorn" companies. "We firmly believe that more achievements and leading enterprises with global influence will be seen in the future in Beijing," Zhou added.