This year marks the 30th anniversary of China's reform and opening up to the outside world. Siemens has been active in China since its first presence here as early as 1872, and has witnessed the rapid growth of China's economy since 1978.

In a recent interview with Beijing Review, Dr. Richard Hausmann, President and CEO of Siemens Ltd., China, shared his views on the changes that transpired in this country as well as his current team's prospects.

Beijing Review: How do you view the reform and opening-up policy? Did Siemens see any investment potential in China in 1978?

Richard Hausmann: China now is not only a market of products to the outside world, but also a country of the source of production, research and development, as well as innovation. The policy is a significantly wise decision that not only helped Siemens and China, but also the whole world. It is the key success factor for the country's economy; it was absolutely the right decision for the country. We can see the fruit of the decision for many years to come.

Siemens is probably one of the few international companies that has witnessed these 30 years in China. In December 1978 and January 1979, we signed the first two Memoranda of Understanding with China's former Ministry of Machine-Building Industry. That was the basis of our engagement in China. This is a clear example of what Siemens all about.

Siemens at that time, 30 years ago, actually was not clear about what would happen. It was rather a risky decision to go into and engage a company in China. It was a sign of innovation, entrepreneurship and also an international approach. The early engagement, supporting the reform and opening-up policy was a major milestone for Siemens globally as well.

Do you see any changes in terms of investment environment and competition? Will this have an impact on your development strategy?

The overall investment climate in China, for an international company, is constantly improving. I'm not saying that it's easier to form a joint venture company or even to buy companies; this may not be the case. But by and large, the transparency of the business environment, the improving intellectual property rights (IPR) protection, as well as clearer regulations on the labor law and so forth, are helping to improve the investment environment.

The competitive situation has also changed. On the one hand, more and more multinational companies are coming here; on the other hand, a lot of very innovative local companies are now on the rise. It's a very fruitful and stimulating atmosphere, which we are enjoying very much.

Our business, as early as in the 1980s, was mostly about bringing new and advanced technologies such as infrastructure--telephone systems and power generation--into the country. Over the last 30 years, however, this has changed significantly, and so have we. We brought the products into a selling market, and we are now, with more than 90 operating companies and factories, actively doing not only production but also research and development, as well as designing our own products for the Chinese market and export. We moved from a state-owned partnership model into a full value-scale business. We had already--since I started here three and a half years ago--pushed into what we called industry, healthcare and energy. The goal is very clear--Siemens will become faster and more efficient, even more customer-oriented and transparent.

From that point of view, I would say that Siemens China was probably on the forefront of new organization, even in the past. There might be some minor adaptations also coming up in the future. But overall, we feel strongly that this new organization setup with the three sectors makes leadership clearer, which in return will also strengthen our business here in China.

In your opinion, has it become harder or easier for Siemens to do business in China?

Being the first international company in the country, it was easier. Now everybody (all of our competitors) is coming because they realize the opportunities here; a lot of local competitors are growing. The overall market, as I said, is getting more competitive. But competition is a great thing; otherwise we would not have developed into what we are now.