BEIJING, April 11 (Xinhua) -- The "Anything but China" (ABC) narrative in some Western media outlets suggests decoupling from the world's second-largest economy. Yet this catchphrase risks overlooking critical realities.
Amid disrupted trade norms and mounting risks, multinationals face unprecedented investment and operational uncertainties. However, unfounded fears over China ties could paradoxically heighten these very risks.
Far from being a relic of the past, investing in China is a strategic imperative for companies seeking to navigate today's volatility and seize tomorrow's opportunities.
WHY "ABC" DOES NOT WORK
A wholesale shift in supply chains away from China -- often prompted by trade tensions and concerns about economic slowdown -- risks introducing higher costs, logistical challenges and fresh vulnerabilities, given the sophistication and efficiency of China's manufacturing ecosystem.
The Chinese economy is deeply integrated into the global industrial and supply chains across a wide range of sectors, ranging from daily goods to industrial equipment and advanced technologies.
In 2024, China maintained its position as the world's top goods trader for the eighth consecutive year, with services trade exceeding 1 trillion U.S. dollars for the first time.
While a vast market with more than 400 million middle-income consumers offers strong growth momentum, China's comprehensive industrial system and well-developed supporting infrastructure provide a solid foundation for multinationals to boost production efficiency and mitigate market risks.
Miguel Lopez, CEO of Thyssenkrupp AG, said that China is not only one of the largest markets, but also the country with the most comprehensive industrial chain and supply chain in the world, as well as a good logistics system.
China has always been a priority market for ambitious multinationals. Despite global economic headwinds, foreign executives were busy visiting China this spring. From China Development Forum to the Boao Forum for Asia and Zhongguancun Forum, the presence of senior foreign executives has underscored the significance of Chinese market in their strategic blueprints.
In sign of firm confidence in Chinese market, British pharmaceutical giant AstraZeneca announced in March a plan to build its sixth global research and development center in Beijing. Also, 13 multinationals, including U.S. retail giant Costco, have recently chosen to establish their regional headquarters in Pudong district of Shanghai.
For consumers around the world, severing ties with China would come at a steep cost, as the country's industrial strength has greatly enhanced global market supply, delivering more diverse, higher-quality, and affordable choices.
Economists note that the so-called "ABC" mentality is more a product of political hype than a rational economic decision, as finding viable alternatives to China remains a significant challenge.
"The approach fails to recognize that integrated global supply chains present opportunities, rather than risks," Qu Fengjie, a researcher with the Academy of Macroeconomic Research under the National Development and Reform Commission, told Xinhua in an interview.
OASIS OF CERTAINTY, OPPORTUNITY
For multinational corporations, China's solid economic fundamentals, consistent policy direction and continuous opening up offer much-needed certainty in an increasingly volatile world, further underscoring why the "ABC" strategy may ultimately prove self-defeating.
Global economic growth would face severe headwinds without China's participation, analysts have warned. The world's second-largest economy has for years served as the primary engine of global expansion, contributing approximately 30 percent to worldwide growth.
Despite mounting global uncertainties, the Chinese economy continues to exhibit sound fundamentals and has demonstrated strong resilience and stability, Michael Bi, managing partner of EY Greater China Markets, told Xinhua.
"China's vast domestic market, improving business environment, and high-standard opening up policies have combined to create a long-term stable investment environment for global enterprises," he added.
China has been advancing high-standard opening up through institutional alignment in rules, regulations, management, and standards, maintaining consistent foreign investment policies that become increasingly critical amid rising trade protectionism and unilateralism in the world.
This year's government work report notes that China will ensure equal treatment for foreign-funded enterprises in fields such as production factor access, license applications, standards setting and government procurement.
A far cry from "ABC," more foreign businesses are betting on China. The country remains a top destination for transnational investment. Some 60,000 foreign-invested companies were established in China in 2024 alone, a 9.9 percent year-on-year increase. The return rate of foreign direct investment in China has remained at approximately 9 percent over the past five years, ranking among the highest in the world.
"We are more than 30 years now in China, and we have several production hubs. For us, it's a very large market. China also is a very attractive market with a lot of opportunities today, in the past, but also in the future, and that's why we're here," said Christian Hartel, president & CEO of Wacker Chemie AG.
Amid a new wave of technological revolution, multinational enterprises are also seeing new growth opportunities in China, which is rapidly evolving into a global innovation leader.
In 2024, China climbed to 11th place in the World Intellectual Property Organization's Global Innovation Index, boasting an impressive 26 of the world's top 100 science and technology clusters -- more than any other country.
From coffee makers and electric vehicles to industrial robots and artificial intelligence solutions, Chinese products and services now feature greater technological sophistication, driving faster foreign investment into the country's high-value-added and high-tech sectors.
China's advances in AI and other cutting-edge technologies have showcased domestic firms' innovation capabilities and market potential while also boosting foreign investors' confidence in the country, according to Bi.
In 2024, the actual utilization of foreign investment in the manufacturing of medical instruments and meters, professional technical services, and the manufacturing of computers and office equipment increased by 98.7 percent, 40.8 percent, and 21.9 percent, respectively.
"China's continued support for high-tech, new energy, digital economy and other sectors will spawn a new round of investment hotspots, presenting strategic opportunities that global investors simply cannot afford to overlook," Bi said. ■