German companies in China are no longer just serving the local market -- they are using their Chinese operations to produce goods for customers worldwide, according to an expert.
Economic relations between the two countries are gaining new momentum. German Chancellor Friedrich Merz is paying his first official visit to China, accompanied by senior executives from about 30 leading German companies in key sectors such as automotive, chemicals, biopharmaceuticals, machinery manufacturing and the circular economy, underscoring Germany's strong commitment to deepening bilateral economic and trade relations.
In an interview with China Global Television Network (CGTN), Zhang Xi, director of the Shanghai Sino-German Industrial Promotion Center, noted that complementary strengths between China and Germany will drive collaborative innovation for their businesses.
"Germany is a pioneer in Industry 4.0 which has very strong technology in like industrial software and automation solutions and standard setting, while China is leading the application in 5G, in intelligent artificial, in big data. So I think these kind of complementary advantages between China and Germany will boost the growth of the cooperation. In the era of the intelligent electric vehicle, the traditional division of labor between China and Germany will change to the collaborative innovation both in China and Germany," said Zhang.
Zhang also noted that China's market scale, industrial ecosystem, innovation and stability make it indispensable for German firms, which are increasingly using China as a global production and innovation hub.
"German companies are continuously increasing their investment in China. Strategic position and value of China for German companies is increasing. In China, the combination of market scale, the industrial ecosystem, the innovation and the stable development in China. So I think these four factors make China irreplaceable for German companies to stay global competitiveness," said Zhang.
"Now the strategy for German companies in China is changing -- they are changing from 'in China for China' to 'in China for world'. For example, Volkswagen, the biggest automaker in Europe, they are building cars here in China not only for Chinese market but also for the rest of the world. So we can see this kind of synergy. In recent years, more and more Chinese companies have been investing and localizing in Europe like electric vehicles, new energy, battery, photovoltaic. For example BYD, MG, the Chinese automakers, they have built factories in Europe. So it's 'local for local’, made in Europe to serve the European market. That's the new trend for Chinese companies to do business in Europe," he said.
German firms in China now produce, innovate for global market: expert
