Microsoft, other US firms expand in China, defying decoupling push

The US technology giant Microsoft has announced plans to expand recruitment and upgrade its campuses in China, following a series of recent moves and plans of major US businesses, including chipmaker Nvidia, to expand their presence in the Chinese market, despite the US decoupling push.

Microsoft said that it will expand its recruitment in China next year to bring the total number of employees to over 10,000, according to a notice on the website of the company. Microsoft already has more than 9,000 full-time employees in China, and 80 per cent of them are research and development specialists and engineering technicians.

On the basis of expanding recruitment, Microsoft plans to upgrade its campuses in Beijing, Shanghai and Suzhou, East China’s Jiangsu Province over the next three to five years.

Microsoft said that since it entered China 30 years ago, it has witnessed and participated in the rapid development of China’s information industry.

“We will continue to strengthen our confidence and determination to develop in the Chinese market and expand investment in human resources, campuses, education and the local ecosystem to find new opportunities in China, boosted by China’s accelerated development of the digital economy,” said Hou Yang, chairman and CEO, Microsoft Greater China.

The move by Microsoft signals that the US business community still sees China as an ideal market and is willing to expand its operations and cooperation in China despite the US’ intension to decouple from China, Liu Dingding, a veteran analyst in the technology industry, told the Global Times.

The announcement by Microsoft, one of the first technology enterprises to enter China, has injected confidence in the industry, which rebutted foreign media reports that foreign investors are leaving China as a result of the US’ decoupling push, Liu said.

“Decoupling is not likely to happen as the industries in both countries have long been closely intertwined,” Liu added.

Nvidia Corp Chief Executive Jensen Huang said that he continues to see a large market for Nvidia’s data center chips in China, despite US restrictions on exports of two of its top chips to the country.

He said that the rules leave “a large space for us” in the Chinese market.

“So our expectation is that for the US and also for China, we will have a large number of products that are architecturally compatible, that are within the limits and that require no license at all.”

US carmarker Tesla also optimised a production line at its Shanghai Gigafactory on September 1, BJNEWS reported. With an investment of 1.2 billion yuan ($169 million), the expanded line will add 4,000 jobs, taking the total staff at the factory to 19,000, according to the report. The production line optimisation will further expand the production scale of Tesla’s Shanghai Gigafactory and consolidate its position as Tesla’s largest facility in the world.

Tesla Shanghai Gigafactory has an annual capacity of more than 750,000 vehicles, followed by the California plant with an annualised capacity of nearly 650,000 vehicles, according to the company’s second-quarter financial results.

Although the US has been stepping up its crackdown on China’s tech sector with chip bans and export restrictions aimed at curbing the rise of China’s high-tech development, US companies think otherwise, Liu said.

“China is an important customer for many large US technology companies, and US companies still hope that the Chinese market will continue to expand to meet their business interests and demands,” Liu said.