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China, through over 20 years of reform and opening to the outside world has not only become a processing workshop for world manufacturing industry endowed with quite some competitiveness but also an arresting world market.

Say, if China's opening to the outside was under the guidance of policies before its entry into the World Trade Organization, but now after 3 years of its entry into the WTO it has turned out a country opened to the outside that can be predicted under the framework of the law. Over the past 3 years, many famous multinationals in China have adjusted their development strategies in China in view of the new situations here.

Change 1, expansion of investment

Multinationals have taken China one after another into their strategies for global development and expanded their business operation goals in China. The expansion of investment constitutes the necessary measures for the realization of their new strategic goals in China. The actions taken by many multinationals have turned out a new round of heated investment here in the country.

As investigation indicates, many famous multinationals have vying with one another extended their investment scales in China since its entry into the WTO. Among them the Japanese enterprises stand out relatively prominent. During the past quite a few Japanese enterprises took China only as its processing workshop for export but now they've taken China for a market which can be actively developed.

Change II, Extending their industry chains

In 1990s, the invested projects by multinationals in China were mostly focused on manufacturing industry. Among them a considerable foreign invested enterprises took China only as their processing bases instead of their markets. During this period the investment by multinationals in China was mainly centered on shifting their assembling and processing links into China as the labor-cost was low in China, namely shifting the links of the lowest added value to China. They put up a great number of modernized factories in China. However, after entering into the 21st century more and more multinationals have not only taken China as their processing bases but also as their newly-boomed markets of the greatest potentials. Under the circumstances multinationals began to adjust their ideas for business operations in China.

In view of their experiences both positive and negative the multinationals came to realize if they engaged only in production and manufacturing industry without a complete network for goods distribution and circulation in China it's quite difficult for them to expand their market here, nor is it easy for them to get over others only by introducing in some new products from alien lands without engaging themselves in researches for development. To carry on research work in China is not only near the bases but also apt to the development of products for the Chinese market. This can not only help themselves reduce the cost for research work but is also good for raising the competitiveness in the Chinese market.

On entering into the new era, the production competition carried out by multinationals in China has been further intensified, being raised from only one industrial link to the whole production links. Confronted with the competition of other multinationals and of local Chinese enterprises that are on the boom the multinationals began to carry out the competition along the whole industrial links while increasing their investment. They've begun to extend their industrial links, namely on the one hand to proceed to the upper reaches for doing researches and development and the core accessories of the manufacturing industries and on the other for developing goods distribution and circulation along the lower reaches of the industrial links.

Change III, Integrated adjustment of enterprise groups

In recent years, many multinationals, while adjusting their strategies operations here have been making adjustments in their management structures in China. They aim at an integrated adjustment and harmonization of all their resources in China, for instance, setting up headquarters for coordinating and harmonizing all the operational bodies into an integrated entity for taking part in the competition, namely to make the several independent and decentralized enterprises of the past into enterprise groups with a unified goal, uniformed strategy and unified brands, in a word a harmonized one in action.