At the eighth China International Import Expo (CIIE) in Shanghai, BMW's "Neue Klasse" technology drew throngs of visitors eager to glimpse the future of mobility. The German automaker showcased its next-generation driving control system, e-drive technology, and cylindrical battery cells - but what drew the most attention was the message behind the exhibit: innovation made in collaboration with China.

"Without the support of our Chinese suppliers, the Neue Klasse would not be possible," said BMW Group Chairman Oliver Zipse. He added that China's supply chain, engineering capability and digital progress have become a source of vitality for BMW's global innovation.

Not just a market but also an innovation hub

Once a key sales market, China has evolved into a critical hub in BMW's global strategy. The company now operates four R&D and innovation centers and three software firms in China, employing over 3,000 engineers - its largest R&D team outside Germany.

BMW is also partnering with leading Chinese tech companies: integrating DeepSeek's AI model, co-developing an AI agent with Alibaba, linking with Huawei's HarmonyOS for seamless in-car experiences, and teaming up with Momenta to refine driving assistance for Chinese roads.

"The CIIE not only showcases the achievements of China's high-level opening up, but also serves as an important platform for global enterprises to collaborate with China in innovation, industrial integration, and sharing opportunities," said Gao Xiang, President and CEO of BMW Group Region China.

Over the past eight years, CIIE has evolved from a trade fair into a symbol of China's shift from "world factory" to "innovation powerhouse." Companies like MUJI are also riding this wave. After two decades in China, MUJI has expanded from localization in design and production to full integration of its supply chain.

At this year's expo, MUJI introduced the "Hanma" series, co-created with Chinese designers. The products now have been sold in Japan and Southeast Asia. MUJI's senior communications director Liu Jingwen said that China is no longer just a market for the company, but also where new ideas begin.

This growing innovative capacity is backed by China's steady rise in global innovation rankings. The country has risen from 34th in the Global Innovation Index in 2012 to 10th in 2025, according to the World Intellectual Property Organization. Meanwhile, the EU's latest Innovation Scoreboard shows that China's score has risen by 31.6 percentage points since 2020 - a growth rate significantly higher than that of Europe and the United States.

Improving business environment

For many exhibitors, China's improving business environment has made innovation easier and faster. Shanghai's Oujian Group, a "CIIE regular," has evolved from a simple exhibitor to a multi-role trade service provider. The customs brokerage company's AI-based operation platform now automates customs clearance, cutting errors to below 0.1 percent and improving efficiency by 40 percent.

Wang Min, the company's vice president, said that the CIIE has helped advance the maturity and improvement of China's cross-border trade service ecosystem, and that it reflected the country's continuous progress toward a more market-oriented, law-based, and internationalized business environment.

Over four decades of reform and opening up, China's approach has evolved from offering preferential policies to foreign investors to advancing institutional openness - aligning its systems and standards with global practices.

That progress is being recognized internationally. In Kearney's 2024 Foreign Direct Investment Confidence Index, China rose from seventh to third place, ranking first among emerging markets.

"Compared with many other emerging countries, China not only has a large economy, but also a more stable and proactive policy environment," said He Xiaoqing, president of Kearney Greater China, noting recent measures such as removing foreign investment limits in manufacturing, easing access in telecom and healthcare and expanding visa-free access to European countries.