By Zhang Chun, Wang Lu, Liang Jingshu, Wang Xue, China Development Research Foundation

Research Report, No.180, 2022 (Total 6694) 2022-05-16

Abstract: According to in-depth interviews with 46 of the global top 500 multinational enterprises in the manufacturing sector, the Chinese high-tech manufacturing industry boasts strong competitive strengths in the attraction of foreign investment. The interviewed enterprises show strong willingness to increase investment in the country's high-tech sector because of the huge potential of its consumption market, secure and stable supply chain, and improved business environment, as well as the robust growth of the green industry and the digital economy. However, these enterprises have shown their concern about some policy uncertainty, such as the ambiguous boundaries of “independent and controllable key technologies”, tightened policies over imported products, and unclear compliance paths for data and network security. Foreign enterprises are less enthusiastic about investment in China due to this uncertainty, and accordingly scale back research and development activities, and reduce production efficiency. In the context of intensified competition for attracting global investment, the country should take actions to make the regulatory environment more predictable, stabilize the expectations and investment confidence of foreign companies, and enhance the competitive strengths of its high-tech manufacturing industry in attracting foreign investment.

Keywords: high-tech manufacturing, multinational enterprises, investment confidence