Shanghai has solidified its position as a preferred destination for foreign enterprises, accumulating a remarkable $100.33 billion in utilized foreign investment during the 14th Five-Year Plan (2021-2025). As companies prepare for the upcoming 15th Five-Year Plan (2026-2030), many express confidence in the city’s ability to support their growth within the Chinese market. The city has become a hub for research and development, production, and corporate headquarters, attracting diverse international businesses.
According to a report from China Daily, Shanghai is home to 631 foreign-invested research and development centers, with over half focused on sectors such as information technology, auto parts, and biopharmaceuticals. Additionally, there are 1,060 foreign-invested corporate headquarters, reflecting the city’s vibrant economic landscape and commitment to fostering innovation.
Emerging Opportunities in Shanghai
Suzano, a leading global producer of market pulp, first entered the Chinese market in the 1980s. The company has established a significant presence in Shanghai, where it operates its regional headquarters and the Asia Innovability Hub. Pablo Machado, global executive vice-president of strategy and Asia business at Suzano, noted that the company’s success is closely tied to Shanghai’s status as a center for scientific and technological innovation.
“Leveraging the core hub of Shanghai, along with our network across Asia, we have built an agile structure dedicated to innovation,” Machado stated. He highlighted the city’s rich economic resources and skilled workforce as key advantages for companies like Suzano. The supportive policy environment further simplifies the navigation of the complex Chinese market for foreign firms.
Machado also emphasized that Shanghai’s commitment to green development aligns well with Suzano’s objectives. The company plans to localize its industry chain while upgrading its value chain to contribute to China’s green transition. “During the past five years, I have been impressed by China’s dedication to high-standard opening-up, which has strengthened our confidence in deepening our localization efforts,” he added.
At the recent China International Import Expo, Suzano introduced its new brand, Jinyu, symbolizing its commitment to the Chinese market and the quality of its products. “This reflects our dedication to grow with our customers, offering tailored, sustainable solutions,” Machado said.
Successful Growth Stories
Another example of successful foreign investment in Shanghai is Plansee, a manufacturer of refractory metals, alloys, and composites. The company has been operating in Shanghai since 2000 and has expanded significantly over the years. In 2013, it opened its first production site in the Lingang area, which has since undergone multiple expansions.
Richard Cheung, managing director of Plansee Shanghai, cited the city’s talent pool and robust industrial ecosystem as critical factors in the company’s decision to establish operations there. The advantageous location within the Yangtze River Delta enhances transportation and connectivity, making it ideal for high-end manufacturing.
Plansee Shanghai is set to leverage its global network to deliver high-performance material solutions tailored to the needs of various key sectors, including medical technology and new energy vehicles. The company plans to increase its annual R&D spending by 20 percent to enhance local innovation and collaborative efforts with regional universities and research institutions.
Cheung expressed confidence in Shanghai’s future role as a hub for innovation, stating, “We will continue to invest in new product development and deepen our roots in the city, contributing to its development.”
Continued Commitment to Innovation
Pierre Fabre, a leading pharmaceutical company in Europe, sees significant opportunities in the evolving landscape of Shanghai as it aligns with the city’s development goals for the 15th Five-Year Plan. Zheng Hongshu, senior director of business development for Pierre Fabre Pharmaceuticals in China, noted the company’s intention to synchronize its innovation strategies with Shanghai’s regulatory advancements.
The Shanghai government has played a pivotal role, granting Pierre Fabre’s subsidiary approval to operate as a multinational regional headquarters in 2024. This will facilitate collaboration on various projects in medical technology and cosmetics, benefiting both patients and the company.
Zheng emphasized the importance of cooperation with local partners, including academic institutions and biotech companies, to drive innovation in oncology and skin health. “Our commitment to collaboration will help us deliver high-quality, effective products to the Chinese market,” he stated.
As Shanghai continues to develop as a global business hub, the city’s strategic focus on innovation, sustainability, and collaboration positions it as an attractive destination for foreign investment, empowering companies to thrive and contribute to the local economy.
