In a global landscape shaped by geopolitical tension, protectionism, and supply chain realignment, China investment continues to demonstrate strong resilience and long-term appeal. While narratives around “decoupling” persist, the real behavior of multinational companies tells a different story: global capital is not withdrawing from China, but recalibrating and deepening its engagement.
A Market That Global Companies Cannot Ignore
In 2025, foreign businesses continued to deepen their footprint in China. Danish energy solutions provider Danfoss expanded its innovation and manufacturing network with new facilities in Suzhou, Nanjing, and Zhejiang, reinforcing its view of China as a “second home market.” Similar commitments have been made across sectors, from consumer goods to advanced manufacturing.
Official data shows that more than 61,000 foreign-invested enterprises were newly established in China during the first 11 months of the year, reflecting strong year-on-year growth. These investments underscore China’s enduring appeal, driven by its massive domestic market, complete industrial ecosystem, and improving business environment.
China is the only country to cover every industrial category defined by the United Nations, and its manufacturing sector has ranked first globally by scale for 15 consecutive years. According to Morgan Stanley, China’s ability to integrate supply chains—combining engineering talent, supplier density, and economies of scale—is nearly irreplaceable worldwide.
Consumption Power and Long-Term Demand
Beyond manufacturing, China’s consumer market remains a powerful magnet. With a population of 1.4 billion and rapidly evolving consumption patterns, demand continues to expand in both volume and sophistication. L’Oréal has repeatedly described China as its most strategic global market, citing its unmatched scale, growth momentum, and consumer vitality.
In aviation, Airbus estimates that China will require nearly 9,600 new aircraft over the next two decades—about a quarter of global demand—highlighting the long-term growth potential of sectors that are far from saturation.
From Manufacturing Base to Innovation Hub
China’s role is no longer limited to production. Increasingly, multinational companies are investing in local research and development to tap into China’s fast-moving innovation ecosystem. According to Roland Berger, being present in China today is as much about leveraging local innovation as it is about market access.
The country ranked 10th in the Global Innovation Index 2025 and leads the world in the number of top innovation clusters. In recent months, AstraZeneca opened a new global R&D center in Beijing, while Porsche launched its first overseas strategic R&D hub in Shanghai. These investments allow companies to shorten development cycles and integrate cutting-edge technologies—often reducing timelines from years to months.
China’s deep talent pool further strengthens this advantage. With a growing number of highly educated engineers and researchers, new technologies can be rapidly tested, scaled, and commercialized within the domestic market.
Policy Stability in an Uncertain World
Amid global volatility, China is positioning itself as an “oasis of certainty” for long-term investors. In recent years, the government has removed all foreign investment restrictions in manufacturing and is now accelerating opening-up in the services sector, including finance, healthcare, biotechnology, and education.
New pilot programs across major cities aim to expand market access and address gaps in high-end services, while initiatives such as the Hainan Free Trade Port’s island-wide customs operations signal China’s commitment to high-standard openness.
According to EY, China’s continued support for high-tech industries, new energy, and the digital economy is creating fresh investment hotspots that global businesses cannot afford to overlook.
A Long-Term Investment Destination
While global economic conditions remain uncertain, the direction of foreign investment in China is clear. Companies are not merely staying—they are upgrading, localizing, and innovating. With its unmatched industrial depth, vast market, expanding innovation ecosystem, and increasingly transparent policy framework, China continues to offer something rare in today’s world: scale combined with stability.
For global investors looking beyond short-term volatility, China remains a market of opportunity—and a strategic destination for long-term growth.
