PricewaterhouseCoopers (PwC) has invested more than Rmb1bn ($140m) in a training institute on the southern Chinese island of Hainan, while overall figures for foreign direct investment (FDI) into services in China continue to fall.
The latest investment, worth roughly $100m, is part of the multinational accountancy firm’s commitment to the Chinese market. In 2021, it laid out plans to invest JPY8bn ($1.25bn) as part of its “New Equation” strategy, in which it plans to target areas such as digital innovation, and create 20,000 new jobs by 2026.
“Mainland China has been putting more and more resources into talent development, technology, innovation and sustainability,” said Raymund Chao, chairman of PwC Asia Pacific and China, in a statement on December 11.
Mr Chao has previously said that PwC “will continue to support and contribute to China’s major national strategies” and will “scale up in a number of strategically important areas”, such as environmental, social and governance policies, and digital technology, to “drive China’s future growth”.
This comes at a time when foreign investors elsewhere in China have been contending with social unrest which has resulted in the loosening of zero-Covid rules from Beijing.
The PwC investment follows a dwindling number of greenfield investments into the Chinese services industry. Between January and October, there were 112 projects, according to fDi Markets, down by 36% on the same period last year.
As the Chinese government moves to steer the economy away from export-driven manufacturing to one led by services and consumption, FDI into services has not picked up the slack left from the decline in manufacturing. In 2021, the number of manufacturing projects dropped by 66%, compared to 2012, while the number of projects in services (sales, marketing and support and business services) also fell by 58%.
But in Hainan, there has been a considerable push to reduce the island’s dependence on tourism with a free trade zone established in 2021 after domestic and international visitors fell away as a result of the pandemic. In March, the Hainan provincial government also announced it will invest more than Rmb600bn in the island, favouring the services and high-tech sectors, as well as tourism.
In August, French logistics company Bolloré also signed a memorandum of understanding with the free zone to jointly develop and build a warehousing and logistics centre. Since the zone was launched, fDi Markets has recorded three greenfield projects.
Commenting on PwC’s investment, Chen Xi, deputy secretary of the Sanya Municipal Party Committee and mayor of the municipal government, said: “We hope that PwC will continue to leverage its advantages in the academic and business sectors so as to help Sanya's digital innovation and talent development.“
“We welcome partners from around the world to our free trade port. We hope they can share the opportunities from China’s development and excel together,” he said.
At PwC’s Asia Pacific Trust Leadership Institute, this will be the second trust leadership institute of its kind, with the company having announced the first earlier this year. The newly announced training institute will exist both virtually and physically, and will sit on a site spanning 16 acres called Reimagine Park, which is set to open in 2025. The ‘Big Four’ firm will also partner with Insead business school, Thunderbird School of Global Management and the Danish Design Centre. PwC declined to comment further.