MNCs in the News*
November 15th, 2016
China approves cyber security law despite intense lobbying by foreign business associations, firms, and governments. China reportedly is considering allowing foreign investment banks to have wholly owned operations on the mainland. China Development Bank Capital (CDBC) and Microsoft have formed a partnership to “promote technology innovation and smart city development.” Germany withdraws approval for a group of Chinese investors’ 670 million euro purchase of Aixtron. The German government is seeking greater powers to investigate and potentially block Chinese acquisitions of German companies. China has expressed concerns about Germany’s seeming new protectionist stance towards Chinese investment. German Vice Chancellor Sigmar Gabriel speaks strongly about protecting German interests and gets the cold shoulder during a visit to China. High-level officials from the United Kingdom (UK) and Britain meet to discuss new investment collaborations in the financial sector. The Japanese government pushes Japanese firms to invest in Russia to help facilitate a resolution of the Russo-Japanese Northern Territories/Southern Kurils dispute. Japanese Trade minister Hiroshige Seko and Russian Far East Development Minister Alexander Galushka agreed to promote economic development projects in Russia’s Far East ahead of a summit between their leaders in December. Japan’s JFE Engineering Corporation will start constructing greenhouses in Primorsky Krai in cooperation with a Russian federal state enterprise. The President of the Japanese chambers of commerce in Britain and the European CEO of Mitsubishi warns that more than general assurances about Brexit are needed to comfort Japanese firms in the UK. Korea and Oman establish basis for Korean companies to participate in almost $27.1 billion in energy and infrastructure projects in Oman. Korea Gas Corporation moving forward on cooperation with China National Petroleum Corporation on natural gas trading, joint international projects, and information sharing. Chinese foreign direct investment (FDI) in Indonesia has jumped following repeated high-level meetings between the Presidents of the two countries. Donald Trump’s victory dampens the opportunities for US energy companies in Indonesia. Jack Ma opts to serve as an advisor to Malaysia rather than Indonesia about the e-commerce economy. Chinese technology giants like Alibaba, Tencent, and Wanda Group have expressed their interests in participating in Malaysia’s digital economy plan. During his recent visit to China, Malaysian Prime Minister Najib Razak signed 14 memorandum of understandings totaling USD $47.5 billion. Pundits note both future opportunities and risks relating to increase Chinese investments in Malaysia.
October 31st, 2016
Chinese outward foreign direct investment (FDI) exceeds inward FDI (IFDI) by an increasing amount in September and for the first nine months of 2016. Chinese companies embrace diverse strategies to ensure host country stakeholders embrace their investments. ChemChina’s interactions with the European Union (EU) over its Syngenta acquisition raise new uncertainties about the deal. Chinese FDI flows into Germany now are almost double what they were for the prior ten years! Businesses from the Philippines glom in large numbers onto President Roberto Duterte mid-October trip to China. China Everbright Ltd. CEO criticizes the motives behind some COFDI. Toyota is waiting for news from the United Kingdom (UK) about the post-Brexit tariff situation before making any decisions about future investments in the UK. Despite Brexit, Nissan opts to built its new Qashqai model in the United Kingdom (UK). Japanese firm wins new contract work for Delhi-Mumbai freight railway. Marubeni and Sojitz win multi-billion dollar gas-fired power plant station contract in Indonesia. Korea Electric Power Corporation signs mega-contract to operate four UAE nuclear power plants that it also will build. FDI flows into Indonesia increased 7.8 in the third quarter year over year (YOY). Japanese firms show increasing confidence in increasing their investments in Indonesia. FDI flows into Thailand increase minimally, reflecting limited confidence in the country’s growth prospects. Foreign technology firms push Thailand to undertake various measures to maintain and advanced its status as a “digital nation.” Malaysian Prime Minister Najib Razak will focus on getting more Chinese investment during his trip to China. PowerChina International, Shenzhen Yantian Port Group, and Rizhao Port Group will work with Malaysia on a deep sea port in the Strait of Malacca.
October 18th, 2016
China’s inward foreign direct investment (FDI) for the first nine months of 2016 grows a modest 4.2 percent year-over-year (YOY). China takes various steps to ease process for inward FDI, but foreign observers reserve judgement. Shanghai Municipal Food and Drug Administration imposes several million dollars in fines on Shanghai Husi and OSI Group’s China office for distributing reprocessed and expired meat. GlaxoSmithKline has been moving over the past two years to enhance its R&D capabilities in China and to take other steps to enhance its ability to serve Chinese patients. Chinese outward FDI in the US hits a record in 2015, spurring increased sensitivity. Chinese President Xi Jinping promises Portuguese Prime Minister his country will encourage more investment in Portugal. Alibaba plans to help Thailand with small business development, e-commerce, and e-payments. Chongqing actively engages with China’s One Belt, One Road scheme giving it all kinds of new export and logistics opportunities. Fujitsu plans to downside in the UK and denies the move relates to Brexit, though there are doubts. Japan’s SoftBank partners with Saudi Arabia’s sovereign wealth fund to create massive tech investment fund. Korean construction firm Doosan wins approximately billion dollar power plant project in Saudi Arabia. Korea Electric Power Corporation wins more than $35 billion coal-fired thermal plant contract in South Africa, the country’s first independent power project. Investors enthused about Indonesia infrastructure opportunities, but worry about requirement they be paid in rupiah. Malaysia welcomes investment in the biomass industry and announces major new investment by Korean petroleum refiner. Samsung’s massive global Galaxy7 smartphone recall may have an adverse impact on Vietnam’s growth rate. Ho Chi Minh City see big drop in investment in industrial parks and export processing zones as it pushes investment in tech rather than labor-intensive sectors.
October 4th, 2016
China’s Ministry of Commerce (MOFCOM) dismisses foreign business concerns about the investment environment for foreign direct investment (FDI). Microsoft, whose Windows 8 was banned two years ago on government computers, is now working on a localized government operating system for China. Outward FDI (OFDI) by Chinese financial institutions jumped 26 percent in 2015 while Chinese OFDI hit a new record. Chinese private firms become the dominant Chinese overseas direct investors in 2015. ChemChina seeks European Union approval of its immense acquisition of Syngenta AG. The parties involved in the Hinkley Point nuclear power complex project, which involves a major Chinese role, finally signed a contract for the deal. China and Thailand struggle to settle issues pertaining to a major joint railway project. China moves to bolster its investment, trade, and other forms of cooperation with Cuba. Japanese business delegation asks China to enhance exit procedures and antitrust rules. Indonesia may impose more than USD $400 tax bill on Google. Foreign pharmaceutical companies pour big money into Indonesia in anticipation of new health care opportunities. FDI accounts for more than 30 percent of Malaysian investment in the first six months of 2016. Thailand is moving to tighten tax collection rules for foreign internet and technology firms. Vietnam moving towards eliminating various caps on foreign involvement in its banking sector. Vietnam’s planned divestiture of Vinamilk could be a very positive sign for the country’s privatization drive.
September 20th, 2016
Inward foreign direct investment (FDI) in China shows growth over the previous month year over year (YOY) and for the first eight months of 2016 YOY. China’s State Council announces China will adopt a nationwide negative list by October 1. Chinese outward FDI (OFDI) dramatically jumps over first 8 months of 2016. Chinese OFDI (COFDI) surges dramatically over first eight months of 2016. British government surprise review of Hinkley Point C nuclear plant deal involving China General Nuclear Corporation (CGNC) results in approval. Chinese government and CGNC pleased by British decision on Hinkley Point C. China is major investor in Myanmar’s power sector. Peru’s President expresses concerns about the financial viability and environmental consequences of a Chinese-proposed transcontinental railway from Brazil to Peru. Brexit may drive some political realignments between Japan and Britain, though Japanese companies await developments. GM Korea President James Kim calls for an end to worker strikes and warns of adverse consequences for GM Korea. Korean Fintech firms will push the Korean Fair Trade Commission to force Apple to open its APIs for near field communication. Following high level leader summit, Korean firms win many deals in Russia. Indonesia tax amnesty fails to produce anticipated results. Indonesian minister’s proposal to soften 2009 Mining Law draws fire. Thailand reports the Sino-Thai high-speed rail initiative is chugging forward.
September 6th, 2016
China’s National People’s Congress Standing Committee adopts amendments that allow for the permanent suspension of four foreign investment related laws in the Fujian, Guangdong, Shanghai, and Tianjin Free Trade Zones (FTZ). China has decided to allow for the creation of six new provincial FTZs as well as one municipal level FTZ, with each place expected to play to its features and comparative advantages. The European Chamber of Commerce in China asserts China’s market barriers are politically unsustainable. China’s Ministry of Commerce confirms to reporters that it is investigating the proposed Didi-Uber merger. British Prime Minister Theresa May confirms she would have her National Security Council examine the potential security implications of China’s participation in the massive Hinkley Point C nuclear power plant project. Japan pledges USD $30 billion investment in Africa at the 6th Tokyo International Conference on African Development. Japanese trading firms find electrifying power project opportunities in Africa. Korean free economic zones are not achieving the anticipated results. Indonesian state-owned enterprises seek funding from multiple sources to fund the country’s massive infrastructure plans. Vietnam and Cuba aim to boost bilateral investment flows.
August 29th, 2016
Committee on Foreign Investment in the United States clears ChemChina’s massive acquisition of Swiss agrochemicals giant Syngenta. Indonesia awards Chinese consortium construction permit for the full length of a USD $5 billion Jakarta-Bandung high-speed railway line. Sino-Vietnamese tensions over the South China Sea have affected the operations of Chinese firms in Vietnam, but many Chinese businesspeople still feel Vietnam has investment appeal. Huawei works with Nigerian government to advance the latter’s national ICT objectives. Malaysia’s Sarawak is working on creating an appealing physical ecosystem to ensure it remains one of the favorite investment destinations for foreign investors.
August 22nd, 2016
China’s Foreign Ministry downplays worries about its cybersecurity law. Apple launches numerous initiatives to enhancing its operating environment in China. China’s Ministry of Commerce (MOFCOM) asserts its rights to review Didi Chuxing-Uber Technologies China merger for potential antitrust issues. Second Australian rejection of a major Chinese investment this year spurs MOFCOM to warn Australia of consequences and to call upon the latter to create a better investment environment. Iran courts increased Chinese investment and prods China for greater involvement in the latter’s One Belt, One Road (OBOR) scheme. Korea’s Ministry of Environment will conduct a major investigation to find out if other foreign carmakers falsified emissions and noise level test data. Seoul’s Central District Prosecutors’ Office grills second Volkswagen Korea executive over allegations the company illegal changed car parts to pass emission tests. Korea’s Fair Trade Commission concludes that Google Korea’s preloaded apps and subsidies for search ads did not restrict market competition. Korea is moving to deal with map data requests from global companies. The Malaysian government continues to support the Iskandar Malaysia economic corridor, with foreign investment representing 40 percent of the money committed to the project. Vietnam’s realized inward foreign direct investment (IFDI) flows fall far below committed IFDI.
August 9th, 2016
Analysts speculate on the economic and political factors that drove the new British government to delay a decision on the Hinkley Point C project. Some conjecture British Prime Minister Theresa May has delayed the project due to national security considerations. Chinese government urges British government to move forward with Hinkley Point decision and hints at possible adverse consequences for relationship. France awards CGN one of its first industrial-scale offshore floating wind power projects. South Korea’s environmental ministry bans the sales and cancels certifications of 80 Volkswagen models over VWs fraudulent emissions and noise tests. South Korea’s National Tax Service Seoul Regional Office launches a tax probe into the Korean affiliate of Huawei Technologies Co. for possible tax evasion. Indonesia’s Investment Coordinating Board (BKPM) is confident of reaching its realized inward FDI (FDI) investment goals for 2016 because of its fast-track permitting process. BKPM chief downplays possibility that the South China Sea dispute will affect FDI flows, including from China, into Indonesia. Indonesian Energy and Mineral Resources Minister emphasizes the country plans to ensure all investors in the energy sector obey the country’s laws and rules. Thai oil and gas conglomerate PTT PLC says it is still in the process of developing a massive refinery and petrochemical plant in Vietnam. Registered inward FDI (IFDI) into Vietnam over the first seven months of 2016 soars over the same period year-over-year (YOY).
July 25th, 2016
Inward FDI into China grew slowly over the first six months of 2016 year-over-year. The Permanent Court of Arbitration’s unfavorable ruling against China’s South China Sea claims sparks protests and boycott calls against American “icons” in China to the chagrin of the Chinese government. A Chinese consortium’s effort to buy the entire Opera Software company falls apart reportedly due to a failure to get sufficient Chinese government approvals. Japanese official travels to Singapore to tout the advantages of Japan high speed rail system for the Malaysia-Singapore high-speed rail project. South Korea’s Fair Trust Commission watchdog relaunches investigation into Google Inc.’s requirement that smartphone makers using its Android operating system preload its search engine. Indonesia’s Investment Coordinating Board (BKPM) is conducting a roadshow in Guangzhou to tout the country’s improving investment environment. Indonesia is working to help investors surmount problems that hinder them from realizing their investments and has developed special initiatives. The Malaysia Investment Development Authority (MIDA) is working on getting more companies to participate in its principle hub scheme. Vietnamese Deputy Prime Minister calls on his country to be more selective in its FDI attraction efforts and to work on getting better FDI.