A growing number of foreign companies in Shanghai are positioning the city as a hub for innovation and the global supply chain rather than a consumption market, marking a strategic shift from "selling in China" to "creating in China" as a wave of new projects comes online this month.

Reckitt, a London-headquartered global consumer goods firm, inaugurated its Shanghai Science and Innovation Centre on July 8, establishing the company's largest research and development base in Asia.

The facility, part of the company's global network of nine science and innovation centers, will integrate advanced research capabilities and accelerate the development of China-born innovations to markets worldwide.

Kris Licht, CEO of Reckitt, said China had become one of the group's most important markets globally, not only because of its size and growth potential but also because it was increasingly driving the group's future innovation.

He expressed confidence that Chinese consumers would inspire the next generation of breakthrough solutions in health and hygiene and that innovations would spread from China to the rest of the world.

Approximately 95 percent of the products Reckitt sells in China are designed specifically for local consumers, and the new center is expected to reinforce this approach.

German materials company Covestro Group announced plans to build a new methylene diphenyl diisocyanate production unit at its Shanghai base, with an annual capacity of 660,000 metric tons, expected to begin operations around 2030.

Holly Lei, president of Covestro China, said the decision to choose Shanghai was based not only on market considerations but also on cost competitiveness and strategic positioning.

Amazon launched its global warehousing and distribution service in the Yangtze River Delta, with dual warehouses in Shanghai and in Ningbo, Zhejiang province.

The Shanghai facility, located in the Lin-gang Special Area near the Yangshan Deep-Water Port, covers nearly 20,000 square meters and is equipped with automated storage and retrieval systems.

Piyush Saraogi, vice-president of the Fulfillment by Amazon (FBA) at Amazon, said the Shanghai warehouse uses the company's smart warehousing management system and supports flexible expansion based on business needs, enabling Chinese sellers to supply global markets.

Lifestyle brand Converse launched a pop-up experience space in Shanghai on July 2. Amy Yang, general manager of Converse Asia, said the Chinese market had been elevated to one of the brand's most important strategic markets worldwide, following the introduction of its China Localization 4.0 strategy that involves the Chinese team in earlier stages of the decision-making process.

During the 14th Five-Year Plan (2021-25) period, pump manufacturer KSB invested more in China than at any other time in its history, with a total investment over the past five years reaching 4.8 times the combined amount invested during the previous 25 years.

He Jun, executive president of KSB Asia North, said KSB China was upgrading from a production base to a global innovation source, with research and development outcomes from Shanghai now being transferred back to the company's German headquarters.

Shanghai added 25 regional headquarters of multinational corporations and 24 foreign-funded R&D centers in the first half of the year.

The city's cross-border e-commerce sector has continued to grow rapidly, with total transaction volume exceeding 1 trillion yuan and an average annual compound growth rate of 23 percent, according to the Shanghai Cross-border E-commerce Association.

Source: Wenhui Daily