Denmark's Danfoss considers China as its “second home market”

Danfoss, a leading Danish heating technology company, made its first investment in China in 1996 by establishing Danfoss (Tianjin) Co. After over two decades, the subsidiary has developed into a modern factory integrating research and development (R&D), new product testing and intelligent manufacturing. Dai Jian, General Manager of Danfoss (Tianjin) Co, said that with more than 10 production sites across the country, Danfoss always regards China as its “second home market”. China has now become its second-biggest regional market and its largest purchasing market.

“We transferred a compressor production line from the United States to Tianjin last year. This year, eight to 10 production lines from Europe are expected to be transferred. All the new production lines will bring CNY800 million of output value annually to Danfoss Tianjin in the future, Dai said.

Driven by China’s goals of peaking carbon dioxide emissions by 2030 and achieving carbon neutrality by 2060, Danfoss has made energy conservation and emission reductions a key development area in China and has continued to increase investment. In 2021, Danfoss announced it would invest CNY140 million to build a global refrigeration R&D and testing center in Tianjin. “It is our largest R&D center currently, and we expect to put it into use by the end of this year,” Dai said. Being in line with China’s development goals, enjoying multiple favorable policies and a promising business environment, are the main reasons for the company to develop and increase investment in China, Dai said.

In addition to Danfoss, many foreign enterprises have also set their sights on China’s future development and expanded their business in the country. According to the 2022 China Business Climate Survey Report by the American Chamber of Commerce in China (AmCham China), two-thirds of the surveyed companies plan to increase their investments in China this year. With consumption upgrading accelerating in recent years, China's vast market, with over 400 million middle-income earners, is attractive enough for global investment, said Cong Yi, Professor at the Tianjin University of Finance and Economics.

In recent years, China has continued shortening the negative list for foreign investment and put into force laws and regulations including the Foreign Investment Law to protect the legitimate rights and interests of foreign investors. Even during the Covid-19 pandemic, China has made great efforts to stabilize industrial and supply chains and ensure the steady progress of major projects, which further bolstered foreign companies’ investment confidence in China, the China Daily reports.