BRI

Dr. Scott MacDonald's picture

The Return of the Great Game and Infrastructure

The Great Game was a geopolitical contest for influence and dominance in Central Asia between Tsarist Russia and the British Empire that occurred in the 19th and early 20th centuries. The game was played out over vast distances, with a mix of spies, money and armies.

MNCs in the News-2018-01-08

Chinese drug approval authorities likely to approve several blockbuster foreign drugs in 2018. Hyundai Motor Group faces declining sales growth in 2018 in large part due to political and economic challenges in China. China State-Owned Assets Supervision and Advisory Commission (SASAC) to issue new guidelines to improve behavior of state-owned enterprises (SOEs) in various areas. United States (US) Committee on Foreign Investment in the United States (CFIUS) concerns leads China’s Ant Financial and US MoneyGram to terminate the former’s acquisition of the latter. Japan’s Toshiba Corp sells floundering US nuclear business Westinghouse, which went bankrupt after regulations and other factors stalled many of its projects, to Canada’s Brookfield. US legal process for Takata Corp.’s US unit coming to completion, which should allow company to make payouts to claimants who suffered from Takata’s faulty airbags. Korea urges US policy makers to reconsider the US International Trade Commission's recommended special tariff on imported Korean washers. Lotte Group struggling to shed its politically troubled Chinese hypermarket chain after talks with Thai conglomerate failed to produce agreeable sale price. Indonesia’s state-owned energy company Pentamina took back control of Indonesia’s largest oil and gas block helping Jakarta to expand its control over domestic energy production. Indonesia’s Investment Coordinating Board launches several measures to spur 10 to 14 percent year on year growth in FDI. Thailand’s Board of Investment expects FDI into its EEC to continue to grow as new EEC policies are implemented and foreign companies become familiar with EEC requirements. Chinese FDI into Malaysia is expected to move out of infrastructure and property development and into new sectors due to China’s Belt and Road Initiative. Japanese Ambassador touts that Japanese firms have a good chance to win Kuala Lumpur-Singapore high-speed rail project. Vietnam’s Ministry of Transport has set a new deadline for long delayed Chinese-funded Cat Linh rail project

Dr. Scott MacDonald's picture

China Needs to Rethink its Game

One factor that has allowed China to expand its global role has been financial diplomacy in the form of loans, business deals and other investments. However, in overlooking issues such as public discontent with dictatorships, corruption and economic mismanagement, Chinese companies have also assumed considerable risk.

Dr. Amitendu Palit's picture

EODB Rankings Augur Well for BRI Investments

The recently released World Bank Ease of Doing Business (EODB) rankings have interesting findings relating to some of the countries involved in China’s Belt-and-Road (BRI) infrastructure project. One of the major groups of countries to have improved EODB rankings since last year is Central Asia. Kazakhstan (+1.06), Azerbaijan (+3.12), Uzbekistan (+4.46), Ukraine (+1.90), Kyrgyz Republic (+0.54) and Tajikistan (0.93) have all moved up the EODB ladder.

MNCs in the News-2017-11-03

The door partly closes on North Korean businesses in China as Beijing tightens sanctions. Analysis reveals Springer Nature has been blocking access to articles in China. Consultancy report highlights expectations of greater Chinese outward investment over the next 12 months with the Belt and Road Initiative anticipated to be a key causal force. The Philippines secures USD $6 billion in Japanese investments after President Duterte’s official visit to Japan. Mitsui Engineering and Shipbuilding Co. to build crane manufacturing plant in Indonesia’s Batam Island free trade zone to take advantage of incentives. South Korean government hopes to prepare host of large-scale investments in China to be announced during upcoming China-South Korea summit. South Korea’s Ministry of Trade, Industry and Energy to decide upon approval of LG Display’s politically sensitive proposed multibillion-dollar OLED production facility investment in China. Indonesia’s FDI shows good growth in the third quarter. Indonesia’s Finance Minister challenges stigmas associated with Chinese investment. Central Group and JD.com announce USD $528 million open system online marketplace JV that links to government’s 4.0 initiative. Thailand’s state-owned PTT Exploration and Production booked another impairment charge due to its delay in moving ahead with investment on its Canadian Mariana Oil Sands project. In its annual report, the Malaysian government stresses positive impacts of the Belt and Road Initiative for the country and the region. Japanese ODA programs increasingly attracting Japanese investors to Vietnam. Vietnam expects USD $30 billion FDI by end of 2017 with majority of investment coming from APEC countries.

MNCs in the News-2017-10-20

At 19th Party Congress, China promises greater market openness for foreign investors, but foreign businesses and governments cautious. Top China Banking Regulatory Commission (CBRC) official says foreign banks may get more latitude in entering and operating in China’s banking sector. Chinese outward foreign direct investment (FDI) plummeted 41.9 percent over the first nine months of 2016 year-over-year. In the first three quarters of 2016, Chinese outward merger and acquisitions activity drops significantly in both deal volume and size. Toyota and Mazda seek USD $1 billion incentive package from US states bidding for their joint car factory. SoftBank Group struggling to carry out US investments after several of its deals have been caught up in the CFIUS review process. US Department of Justice demands Kobe Steel release all information related to it falsified steel and metal data. SK-Sinopec JV to expand its Wuhan Petrochemical plant mirroring success of SK Innovation’s China Insider strategy. Korean battery manufacturers finding backdoors into the Chinese market despite Chinese government’s preferential treatment of domestic firms. Indonesia works to attract private investment despite bad atmosphere created by problems with Freeport-McMoran. Freeport-McMoRan facing labor union protests over anticipated layoffs. New US-Thai joint committee formed to increase bilateral investment following Thai Prime Minister’s recent US visit. Malaysia’s Ministry of International Trade and Industries leads trade mission to Europe to attract German investment. MITI reports a decline in investments this year. Vietnamese government begins implementing its divestment plan for Dung Quat Oil Refinery, attracts foreign investors. Foreign brewers eagerly awaiting Vietnamese government’s divestment plans for country’s largest domestic brewer Sabeco.

MNCs in the News-2017-09-08

The China Insurance Regulatory Commission states China is moving to increase foreign involvement in the insurance sector. In conjunction with the latest BRICs meeting, State Grid of China touts its contribution to and presence in Brazil. Kawasaki Heavy Industries competing for USD $3.2 billion contract to build subway cars from New York’s state-run Metropolitan Transpiration Authority. Foxconn joins bidding process for Japanese chipmaker Toshiba’s USD $19.5 billion NAND memory technology. North Korea’s missile launch explodes USD $1.5 billion South Korea’s shipbuilding industry deal with foreign firm. Beijing Hyundai resumes operation at stalled Changzhou (China) facility, but the firm still faces many other challenges. Freeport McMoran to retain control over operations of Grasberg mine, with USD $750 million investment to be made next year. Indonesia urges APEC to boost cross-border investment by supporting micro, small, and medium enterprises. Thailand's small and medium-sized enterprises urged to invest in Mandalay, Myanmar because of favorable economic and political environments. Tien Phong Industrial Zone JSC and Russia’s Seaport of Azov sign memorandum of understanding to jointly build Vietnam-Russia Industrial Complex. South Korean investment in Vietnam continues to soar as tariffs reductions from the ASEAN-Korea free trade agreement slowly come into effect.

MNCs in the News-2017-08-18

China takes steps/promises measures to draw in more foreign direct investment (FDI). China’s State Council details a slew of initiatives to increase greater inward FDI (IFDI) as well as to foster specific types of IFDI. Donald Trump signs executive order authorizing US Trade Representative to decide whether or not to investigate China’s theft of American intellectual property. China’s Ministry of Commerce reports small drop in IFDI over the first seven months of 2017 year over year (YOY) while outward FDI drops dramatically over the first seven months of 2017 YOY. The Philippines is looking to Japan and China to finance investments in energy and power generation projects worth over USD $135 billion. Mitsubishi UFJ Financial Group Inc. to expand operations in Saudi Arabia to support Saudi initiatives to reduce reliance on oil. Kumho Tire Co. to be bought out by its Chinese competitor Qingdao Doublestar Co. for USD $857 million after South Korean state-owned development bank sells its stake to Doublestar. Hyundai to promote Indonesia as Southeast Asian production base because of, among other things, the ASEAN Trade in Goods Agreement will remove car import duties in 2018. Indonesia and Vietnam to boost investment activity following 7th Indonesia-Vietnam Joint Commission on Economic, Science, and Technical Cooperation. Facebook opens full office in Indonesia due to tightening regulations on foreign Internet firms. Recent report touts that Malaysia’s strategic location and competitive position make it attractive for foreign investment. US deepening investigation into money stolen from Malaysian state investment fund allegedly used to obtain around USD $1.7 billion in real estate, jewelry and art.

MNCs in the News-2017-06-23

China’s State Council announces that 27 restrictions relating to foreign direct investment (FDI) in its free-trade zones have been eliminated. China’s non-financial outward FDI (OFDI) plunges by almost 53 percent for the first five months of the year year-over-year (YOY). Chinese legal experts suggest new international legal mechanisms may be needed to deal with disputes involving Chinese OFDI. China’s Huadian, a state-owned enterprises (SOE), and Russia’s TGC-2 announce nearly $600 million joint venture power project has come online. After years of decline because of political tensions Japanese companies now more willing to invest in China. Survey shows Japanese firms willing to increase investment in Thailand especially in Eastern Economic Corridor. Samsung Electronics Co. about to finalize talks on expanding its US production facilities, a move motivated by Donald Trump’s election. Jakarta promises more easing of rules to increase foreign investment. PGN, Indonesia’s National Gas company, plans to make Batam Indonesia a center of natural gas supplies and a “paradise” for energy investors. Malaysia Digital Economy Corp welcomes Japanese ICT firms to use Malaysia as a stepping-stone for entering the Southeast Asian market. Malaysia’s Construction Industry Development Board to participate in bidding process for Indian railway stations’ makeover.

MNCs in the News-2017-05-26

China’s Ministry of Commerce (MOFCOM) reports the country will significantly reduce its negative list for inward foreign direct investment (FDI). China counters German criticisms of its market access by saying it will open its auto sector and that Germany had profited substantially from China’s past opening. China’s new cybersecurity law is sparking foreign companies to move to comply and deterring foreign company hardware/software sales. From January through April, China’s non-financial outward FDI drops significantly versus the same period last year. Japanese firms cooperate with US counterparts to develop missile defense radar. Japanese firms not enthused about China’s OBOR and see better business opportunities flowing from other initiatives. Japanese multinational firms that have invested heavily in Africa are worried about the continent’s prolonged economic slump. The leader of Korean SK Group leave for Beijing to meet with Chinese officials to normalize relations after his country’s installation of THAAD. K-Sure signs USD $3 billion deal to finance clean fuels project in Kuwait. Geely buys 49.9 percent of troubled Malaysian carmaker Proton. Malaysian Prime Minister says government programs make Malaysia’s FDI inflows for this year surpass last year’s. Vietnam plans to set up three special economic zones to boost foreign investment. Vietnam’s Deputy Prime Minister reiterates country’s dedication to welcoming foreign investors.