According to China’s Ministry of Commerce (MOFCOM) data, foreign direct investment (FDI) in the services sector jumped 13.5 percent year-over-year (YOY) over the first 11 months of 2017. Foreign investors are increasingly interested in China’s service and technology-intensive sectors versus labor intensive industries and, in the view of various observers, China will attract greater FDI when it further opens sectors and eases market entry restrictions. Foreign firms covet opportunities to reach China’s huge Middle Class and provide services in areas like health care (Zhong Nan, “Services Sector Emerges as Key to FDI in China,” China Daily, December 25, 2017,

According to China Daily, China’s National Development and Reform Commission (NDRC) is “paying close attention to a recent surge in the price of mobile phone storage chips and could look into possible price fixing by the firms that make them.” Prices have been jumping over the past 18 months because of a convergence of tight supply and heavy demand from Chinese smartphone makers like Xiaomi for chips critical to smartphones. The NDRC has had communications with Samsung and SK Hynix Inc. which dominate the market (“China Regulator Flags Greater Scrutiny on Chips after Price Surge,” Reuters, December 26, 2017,

In late December, the China Banking Regulatory Commission issued draft rules for public comment. These rules would “make it easier for commercial banks to incorporate on the mainland, open new branches, and obtain permits to enter new business lines.” The initiative comes in the wake of United States President Donald Trump’s visit to China in November during which it was promised China would allow greater FDI in various financial sector areas. The draft rules do not change ownership limit caps on foreign investors (Gabriel Wildau, “China Eases Market Access for Foreign Banks after Trump Visit,” Financial Times, December 29 2017)

An NDRC minister stated after the body’s annual conference in late December that China plans to create legislation that will enhance supervision of all phases of outward FDI (OFDI). This legislation will demand better cooperation among government agencies, enhanced statistics collection and sharing, and clarify which areas have limits. A NDRC official said “‘the general standard is to examine whether the overseas investment is against national security interests,” touting the government actually had “‘streamlined the registration system a lot for those investments that are neither limited nor restricted’” (Wang Yanfei, “Investment Scrutiny to Widen,” China Daily, December 23, 2017,


After state-owned Steel Authority of India Ltd (SAIL) failed to meet the country’s increasing rail supply needs, the Indian government decided to open India’s rails to foreign bidders. Japan’s Sumitomo Corp, an integrated trading company, is among eight bidders for India’s global tender to provide 487,000 tons of rails for India. New Delhi has for the first time allowed railways to source materials from foreign companies as long as 20 percent of the contract is given to a domestic steel producer (Neha Dasgupta, “Japan’s Sumitomo, Jindal Steel among 8 bidders for India rails tender: source,” Reuters, December 22, 2017,

Japan’s Kubota Corp. is partnering with South Korea’s POSCO Construction & Engineering to build water supply systems in Myanmar’s Yangon. The investment projects, totaling over USD $90 million, are part of the Burmese government’s efforts to develop its Thilawa special economic zone to attract more foreign investment to the country. The water treatment plants are also part of the Greater Yangon Water Supply Improvement Project designed to improve Myanmar’s water supply services and are financed by various loans from Tokyo (“Kubota to join $92 million project to improve water supply system in Yangon,” The Japan Times, December 25, 2017,

South Korea

South Korea’s LG Display has received the green light from Seoul to build a USD $4.5 billion OLED production plant in Guangzhou, China. Debate over approving the plant centered on the possibility of leaking South Korean technology to Chinese firms. LG Display has assured officials that “investment will be made not in a Chinese company but in LG Display China.” LG Display’s decision to build a plant in China is partly due to the China-Korean free trade agreement excluding OLED panels (Cho Jin-young, “LG Display’s Plant in China Expected to Double OLED Panel Production Capacity,” BusinessKorea, December 28, 2017,

South Korea’s state-owned Korea Gas Corporation (KOGAS) has finally realized a return on its 2010 investment in Australia’s liquefied natural gas (LNG) sector. KOGAS, which had initially taken a 15 percent stake in Australia’s Gladstone LNG plant, injected an additional USD $4 billion in the project last year. The recovery of world gas prices has improved the plant’s profitability despite Canberra’s increased regulation on LNG exports and initially low fuel costs dampening the plant’s prospects (“KOGAS starts generating profit from investment in Australia,” Yonhap News Agency, December 26, 2017,


Japan’s Mitsubishi UFJ Financial Group (MUFG) is posed to win approval from the Indonesian government to purchase 73.8 percent of Bank Danamon Indonesia. The first part of the acquisition consists of MUFG purchasing just 19.9 percent in the Indonesian bank for USD $1.2 billion. Usually Jakarta restricts foreign ownership of banking units to 40 percent, but is willing to allow the Japanese firm to take a majority stake as it previous did in another case involving China Construction Bank Corp (Cindy Silviana and Fransiska Nangoy, “Japan’s MUFG Hopeful of Regulatory Approval for Danamon Deal,” Jakarta Globe, December 27, 2017,


Major motorbike companies including Japan’s Honda Motor Co. and Italy’s Ducati are moving to build production and assembly plants in Thailand as the latter’s government investment packages continue to proliferate. Bangkok’s Board of Investment has offered incentives including tax-free imports of machinery, unrestricted foreign ownership and corporate tax exemption for bike manufactures as part of efforts to develop its “supercluster” Eastern Economic Zone. On top of a growing domestic market, Thailand’s lower tariff regimes with other countries make exporting products attractive to foreign companies (“Honda, Ducati lead shift to big motorbikes in Thailand,” Nikkei Asian Review, December 26, 2017,


Engineering firms from the United Kingdom (UK) including Blackwell and Balfour Beatty are looking to bid on light rail transit and construction projects from the Malaysian government. Kuala Lumpur and Singapore are looking for a consortium of firms that can develop a high-speed rail system between the two locales while Kuala Lumpur also is looking to upgrade a host of rail lines within the country. Malaysia specifically is looking to the UK firms to improve performance, create more efficient networks, and upgrade infrastructure (Ooi Tee Ching, “UK firms eye rail jobs in Malaysia,” New Straits Times, December 27, 2017,


Japan has surpassed South Korea to become the largest investor in Vietnam as Japanese investment into the country rose to USD $35.8 billion by late December last year. Japanese companies primarily focused on infrastructure improvements through public-private partnerships as Hanoi sought to increase Vietnam’s attractiveness for further development. Notable billion dollar projects by Japanese firms include Marubeni’s USD $2.79 billion coal power plant, Sumitomo Corp’s USD $2.58 billion coal plant, and Mitsui Oil Exploration’s USD $1.27 billion gas pipeline (Atsushi Tomiyama, “Japan returns as top investor in Vietnam,” Nikkei Asian Review, December 28, 2017,

*The information compiled in the MNCs in the News digest is gathered from sources believed to be reliable, but the Wong MNC Center does not guarantee their accuracy. The content of the MNCs in the News digest does not necessarily represent the view of the Wong MNC Center, its Board of Directors, or its Advisory Board, but is intended for the non-commercial use of readers in order to foster debate and discussion and to facilitate and stimulate research.