Austrian industry sees opportunity and competition in China

China has become Austria's third-largest trading partner, and economic ties between the two countries continue to expand. That is the backdrop to Austrian Foreign Minister Beate Meinl-Reisinger's visit to China this week, accompanied by a business delegation seeking to strengthen commercial links.

One Austrian company already deeply embedded in the Chinese market is RHI Magnesita, a global leader in refractories used in industrial furnaces.

Creating bricks and lining mixes that can withstand temperatures of up to 1,200 degrees Celsius, the company has shifted a significant portion of its manufacturing operations to China over the past decade in a move aimed at improving efficiency.

"I have to say that on the manufacturing side, the Chinese plants are the best in the world," RHI's CEO Stefan Borgas told CGTN. "They manage the best. They're the cleanest. They're the safest. They're the most productive ones. And then they're also the ones with the lowest cost."

RHI employs more than 2,000 people in China, and Borgas admires the competence of his Chinese production team. 

"They are super eager to learn," he said. "They improve month by month by month. They always beat the forecasts. And they have an ambition, style that is really absolutely intoxicating."

While Borgas praises the company's decision to transfer around 40% of its mining and production activities to China, he acknowledges that success in the country's domestic market is far from guaranteed.

"On the sales side, the Chinese market is superbly difficult, characterized by terrible competition," Borgas said. "Whatever you do today, you have a competitor who does this better than you tomorrow. So you have to stay on your feet, you have to really stay active. And if you're not, then you cannot grow."

The competitiveness of Chinese industry is also increasingly visible in Austria's broader trade relations.

Last year, Austria saw a major shift in its trade landscape as China overtook the United States to become the Alpine republic's third-largest trading partner. While Austrian exports – primarily machinery – fell by around 4%, imports from China surged by more than 13%, driven largely by strong demand for electric and hybrid vehicles.

But Borgas believes opportunities for cooperation extend far beyond green mobility.

"If you're an industrial company, you cannot ignore China – China for sure does not ignore you," he said. "China is 50% of the world market pretty much in every industry. I can only invite all Austrian companies that have a global business, go there, create some partnerships. The people are incredibly open. The Chinese mentality is super inviting. The food is fantastic."

The comments come as RHI Magnesita seeks to rebound from a challenging year. The refractories producer reported weaker profits in 2024, with adjusted earnings per share (EPS) falling by roughly one-third amid sluggish industrial demand and a surge in Chinese exports.

By leveraging the efficiency of its Chinese operations and maintaining its presence in one of the world's most competitive markets, the company hopes to reverse that trend and position itself for future growth.