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Global executive bullish on China's momentum

By WANG KEJU China Daily Updated: 2023-05-04
Rainer Hoefling, CEO of Borouge. [Photo provided to]

The stronger-than-anticipated economic recovery in China and its sustained efforts to open up to the outside world will benefit global businesses to a great extent, a top multinational executive said in an exclusive interview with China Daily.

China has embraced the positive momentum in its economic recovery in recent months as it fine-tuned its COVID-19 response measures in light of shifting dynamics, said Rainer Hoefling, CEO of Borouge, an Abu Dhabi-based petrochemical company that manufactures recyclable plastics used in many fields, including automobiles, food packaging, medicine vials and piping systems.

Hoefling added that many global company executives are coming back to China seeking new opportunities.

China's gross domestic product expanded 4.5 percent year-on-year in the first quarter, according to the National Bureau of Statistics. Bureau officials said the economic growth is expected to post a gradual rebound throughout the year.

"The Chinese economy has great resilience and potential and its strong fundamentals will not change, which bodes well for a steady and sustainable growth and offers great opportunities for global companies," Hoefling said.

China has set an annual economic growth goal of about 5 percent for this year and has put expanding its domestic demand high on its agenda, which sends encouraging signals about sharing opportunities and benefits with enterprises worldwide with its massive domestic market, Hoefling said.

Borouge has been dedicated to providing recyclable plastics to China for the past 25 years, extending the reach of its business from eastern and southern China to the central and western regions in a step-by-step manner, he said.

Thanks to China's fast-growing market, Borouge has posted robust growth. It registered revenue of $6.7 billion in 2022 amid a dampened global economy, approximately 30 percent of which was contributed by the Chinese market, Hoefling said. He added that there is still huge market potential to tap into in China.

Meanwhile, China has rolled out a broader agenda of opening-up, to provide all possible facilitation for foreign investors and shore up their confidence, which fosters positive sentiments for Borouge and other global companies alike, he added.

China is still in the process of rapid urbanization, which has been accompanied by increases in industrialization and productivity as well as economic growth for the whole country, he said.

The latest data released by the NBS showed that the urbanization rate in China stood at 65.22 percent by the end of 2022.

"This will enable China to remain on its positive trajectory over the long run. As China continues to grow and develop, there will be increasing demand for products and services across many sectors," Hoefling said. "This will present numerous opportunities for companies in different industries."

With the Chinese government's commitments to and policy support for expediting energy transition, promotion of electric vehicles and enhancement of infrastructure development, Borouge is strengthening its development capability in China.

The company has established a center for technology application and a plant for producing modified plastic products in Shanghai as well as logistics hubs in a few cities in China. It also works closely with various Chinese companies with a special focus on the circular economy in recent years, Hoefling said.

A circular economy is a system based on the regeneration and reuse of materials, especially in a way to continue production that is sustainable or environmentally friendly.

Borouge plans to embark on joint ventures and further strengthen local production in China as the country boasts the world's largest emerging market, highlighted by high production efficiency, strong innovative capabilities, complete industrial systems and continued efforts in opening-up, he said.

"Asia, and China in particular, will remain our largest market and key to our future growth," he said, adding that economic recovery in China will positively impact broader sentiment in Asia, which the company expects to stimulate greater investment and demand across the continent.