Too big to ignore: China made up 15% of revenue for the world’s top 200 multinational companies in 2022, Bain’s data shows

China remains an important market for multinational corporations (MNCs) this year as executives eye opportunities from a rebound in consumption, even if their prospects have been bedevilled by challenges ranging from geopolitical risks to competition with local rivals.

China made up about 15 per cent of global revenue for 200 of the biggest MNCs from Japan, Europe and the US in 2022, according to Bain & Co’s data. Contribution by the world’s second-largest economy was even bigger for Tesla, Mercedes-Benz and the Japanese cosmetics brand Shiseido, which earned between 22 and 37 per cent of their revenue from China.

“It is important to take a longer term view on China instead of focusing on short-term volatilities,” said Bain’s Shanghai partner Bruno Lannes. “China’s economy will continue to grow and represent an increasing share of global revenues for MNCs doing business here.”

China’s economy is expected to grow 5.4 per cent in 2023, the International Monetary Fund said, a faster rate than the 3 per cent in 2022 when the country was hobbled by restrictions and partial lockdowns in pursuit of the government’s zero-Covid policy. The momentum may slow to 4.5 per cent in 2024, according to market forecasts compiled by Bloomberg, as piecemeal stimulus measures failed to overcome pessimism among corporate executives and consumers about the prospects of growth.

Still, China remains the biggest market for food and beverages, automotives, textiles and apparels, chemicals and chemical products, iron and steel, as well as consumer electronics, according to Bain.

The idea that China remains attractive for foreign companies despite macro volatilities was echoed by Alfredo Montufar-Helu, head of the China Centre for Economics and Business at The Conference Board, a global non-profit think tank.