yuan

Mr. Naoyuki Haraoka's picture

Japanese MNCs in China Are Increasing the Use of the Yuan in Intra-firm Trade with Japan

Mr. Naoyuki Haraoka
Posted: Aug 15, 2016

The internationalization of Chinese yuan is fully underway with rising use in trade, settlement, and financial transactions. To what extent do Japanese multinational corporations (MNCs) in China, which have numerous subsidiaries and extensive production chains there, use the yuan in their transactions?

MNCs in the News-2016-04-08

China fails to submit new negative list proposal to US. Chinese firms are pouring money overseas driven by a depreciating currency among other factors. The Washington Post calls for a new approach to Chinese outward foreign direct investment (FDI) that takes into account non-traditional risks. ZTE replaces three top executives in reaction to US sanctions and warns of possible further penalties. China’s Beijing Urban Construction Group wins bid to build a US $300 million international cargo hub and airport in Bolivia. Korea Electric Power Corp. wins its first overseas solar power plant contract. Indonesia’s Investment Coordinating Board warns it will annul the investment permits of foreign companies that are avoiding their tax obligations. Indonesia and France work to expand the possibilities for French infrastructure investment in Indonesia. Thailand’s United Power of Asia Plc has signed an agreement with Myanmar’s state utility to construct a gas-fired power plant in the Dawei special economic zone. Russia and the US are competing for investment opportunities in Vietnam. Vietnam moves to increase its harvest of investment, especially FDI, in the agricultural area. Vietnamese representatives court investors from the Chinese mainland, Hong Kong, and Macao at a seminar in Hong Kong.

MNCs in the News-2016-01-01

China’s Central Economic Work Conference promises to “‘give equal treatment to domestic and foreign companies.’” China’s National People’s Congress approves counter terrorism law that worries foreign businesses and governments. China’s State Council issues guideline designed to enhance IPR protection. China’s National Development and Reform Commission (NDRC) issues a draft of its first “Anti-Monopoly Guidelines on Abuse of Intellectual Property Rights” for public comment. China’s NDRC fines eight international sea freight shipping companies for price fixing. China’s People’s Bank of China suspends three foreign banks from certain kinds of foreign currency activities. Analysts expect Chinese outward investments to reach new heights in 2016. China’s nuclear power firms hope Hinkley Point project will be a stepping stone to new deals abroad. China and Pakistan finalize financing agreement for massive Thar Coalfield development project. Iraqi Prime Minister courts Chinese investment and railway cooperation during his first visit to China. Japan competes vigorously against China in battle to sell high-speed rail overseas. Inward FDI into Korea hits new high in 2015. At the end of December, Korea announced it would impose a Google tax on foreign companies. Hyundai Development Company wins $85.4 million bridge and road construction contract in Vietnam. Samsung Engineering lands another major engineering contract from Mexico’s PEMEX. The Association of Southeast Asian Nations Economic Community is expected to boost franchise businesses in Indonesia. Indonesia is hopeful that a Comprehensive Economic Partnership Agreement (CEPA) with the European Union (EU) will boost EU IFDI. Indonesian will increase incentives to boost investment in oil refineries. Thailand expects IFDI to meet its targets in 2016. China and Thailand hold ceremony to launch joint rail project, though disagreements exist which may delay the project’s start date. Malaysia touts the benefits of its Principal Hub scheme. Chinese group negotiating with Malaysian firms in order to position itself for a bid on Malaysia-Singapore high-speed rail. Experts feel recent free trade agreements will boost investment in Vietnam. Vietnam expects US FDI flows into Vietnam to increase significantly, though obstacles remain.

MNCs in the News-2015-01-09

BMW agrees to give China car dealers RMB 5.1 billion in subsidies to address dealer concerns. China’s Ministry of Commerce (MOFCOM) terminates 17 rare earth mineral export quotas. Li Keqiang to attend Davos Forum for the first time in six years. Shanghai Husi lashes out at Shanghai Food and Drug Administration. China promises US $250 billion in investment in Latin America over next 10 years. China Construction Bank (CCB) wins branch license from the UK Prudential Regulation Authority and Financial Conduct Authority. Honda slapped with US $70 million fine by US National Highway Transportation Safety Administration. Sony’s satire “The Interview” (about North Korea) proves to be a success on the Internet despite hacker threats. US FBI states there is strong evidence that North Korea was guilty of cyber attack against Sony. FDI into Korea in 2014 jumped due to free trade agreements and government policy initiatives. Korea Trade Investment Promotion Agency to step up efforts to realize government inward foreign direct investment goals for 2015.