BEIJING: As global economic growth slows and capital markets become increasingly risk-averse, China continues to stand out as a crucial investment destination. However, its appeal is no longer merely about low-cost manufacturing or sheer market size.
Instead, it stems from industrial upgrading, policy shifts, and the restructuring of global supply chains – factors that present both opportunities and challenges for foreign investors.
During the ongoing China Development Forum (CDF) 2025 held in Beijing from March 23 to March 24, experts and multinational executives discussed China’s investment returns, policy advantages, and long-term outlook. While skepticism might persist, actual capital flows indicate that global businesses remain deeply engaged in the Chinese market. The role of foreign enterprises in China is shifting from being low-cost production bases to high-value market participants.
In recent years, the Chinese government has accelerated market reforms, including lowering entry barriers for foreign firms and strengthening intellectual property protection, aiming to create a more predictable investment environment. But unlike the investment-for-growth model of the 1990s, today’s approach prioritizes investment quality over sheer volume.
“China is very effectively integrating its move up the value chain,” pinpointed Ian Goldin, Founding Director of Oxford Martin School, Oxford University, saying the country used to be the factory of the world for low-skilled, low-value-added goods.
This shift has profound implications. Foreign companies are no longer competing on cost efficiency alone, but on their ability to integrate into China’s evolving industrial ecosystem. “Now, it is shifting toward high-value-added, artificial intelligence, and IT-driven industries. As a result, China will become increasingly significant, but at a higher value level – and this is good for both China and the world,” Goldin told media. –Agencies
