MNCs in the News-2017-06-30


China’s Ministry of Commerce (MOFCOM) has announced it will create an information platform that “publicizes records of foreign investment, joint annual reports, and credibility archives.” It argued this “will increase transparency and predictability of foreign investment management” and for some this is a reflection of the government’s effort to remove itself from approval to regulation and supervision. China’s inward foreign direct investment (FDI) dropped 3.7 percent year over year (YOY) in May and looking at the first five months of 2017 inward FDI (IFDI) dropped only 0.7 percent YOY (“China to Publicize Foreign Investor Information,”, June 26, 2017,

China’s MOFCOM and National Development and Reform Commission (NDRC) just published China’s “first nationwide negative list for foreign investment.” This list, formally called “Special Administrative Measures, has 35 sectors (like seed production and rare earth mineral separation) in the restricted category and 28 industries (like air traffic control, film production, and internet news information services) in the prohibited category. In 2015, there were 93 sectors in the restricted and prohibited categories versus the contemporary 63 sectors. IFDI project not on the list only require registration (Fran Wang, “China to Roll out First Nationwide Negative List,” Caixin, June 29, 2017,

The Central Leading Group for Comprehensive Reform has decided that the Chinese government will “enhance its monitoring and supervision of overseas investment deals to safeguard China’s economic interests and national security.” In line with this, it wants the government to “‘improve statistics and strengthen supervision.’” Government attention to outward FDI (OFDI) surged in 2016 and has to do with concerns about capital flight, people hiding money abroad, and overleveraged companies that might pose risks to the entire Chinese economy (Frank Tang, “Overseas Deals a National Security Matter for China, Xi Says,” South China Morning Post, June 27, 2017,

The United Kingdom (UK)’s decision to leave the European Union (EU), commonly known as “Brexit,” made many wonder whether or not Chinese companies would continue to be excited about investing in the UK. Despite this and current data, which show a decline in Chinese OFDI, some feel interest will remain strong given growth opportunities, the chance to acquire intellectual property rights, and “‘easy access to financing.’” On top of this, the UK government is “keen to get more Chinese investment given ‘Brexit uncertainties’” (Cecily Liu, “Chinese Companies Will Continue to Look for UK Investments,” China Daily, June 30, 2017,


Takata has filed for bankruptcy protection in the US and Japan. The firm also agreed to be “largely acquired” by the Chinese-owned US-based Key Safety Systems (KSS) for USD $1.6 billion. Takata faces “tens of billions of dollars” in costs and liabilities resulting from almost a decade of recalls and lawsuits, because of issues with its airbag inflators. KSS agreed to acquire the troubled firm’s viable operations, while the remaining operations will be restructured to continue to produce millions of replacement airbag inflators (Naomi Tajitsu, “Japanese Airbag Maker Takata Files for Bankruptcy, Gets Chinese Backing,” Reuters, June 26, 2017,


The Korea Economic Research Institute, a private think tank, recently urged the Korean government to “exempt taxes on income” earned by South Korean multinationals abroad so they can more easily repatriate funds which, in turn, would boost investment in South Korea. At present, Korea uses a residence tax principle like the US, meaning that Korean firms are required to pay additional taxes if they bring their profits back as dividends or direct investment. This problematic policy encourages Korean multinationals to keep their earnings abroad (“Govt. Urged to Exempt Taxes on Income Earned abroad: KERI,” Korea Herald, June 28, 2017,

Samsung recently announced that it plans to open a factory in South Carolina and will hire over 950 people. The Korean conglomerate joins a growing list of international companies announcing they will “aid job creation” in the United States (US). These moves follow US President Donald Trump’s effort to spur manufacturers to create more industrial jobs in the country. In tandem with the investment, the firm will receive “financial incentives” from the state of South Carolina “tied to job creation” (Micah Maidenberg, “Samsung Joins Ranks of Foreign Firms Adding Jobs in the U.S.,” New York Times, June 28, 2017,


To attract more foreign investment, the Indonesian government is about to revise the Negative Investment List. The infrastructure sector will be opened more widely for foreign investors from the current range of 49 - 60 percent to 70 percent. Some analysts compared this policy with what the Chinese government has done in the past. China has released the restrictions on foreign investments with certain conditions, and this method contributed to attracting foreign capital and boosting the national economy (“Copying Chinese Step, Foreign Investment in Indonesia Should NOT be Restricted,” Netral News, June 30, 2017,

In its recent report on Indonesia's Economic Development the World Bank stated that foreign investment in Indonesia is still too low compared to other Southeast Asian countries. There are various reasons for Indonesia’s low FDI levels, including the country’s restrictive Negative Investment List (DNI) policy and local level investment permit regulations that create barriers for foreign investors. The World Bank recommends that Jakarta makes policy reforms to increase the inflow of foreign investment, including further revising its DNI (“To Grow More Investments, Indonesia Suggested to Revise Negative Investment List,” Netral News, June 29, 2017,


Malaysia’s International Trade and Industry Minister stated the government is “constantly striving” to attract foreign investment to create ample work opportunities, particularly for the younger generation. Since foreign investment is essential for the country’s economy, the government is now courting large foreign investors from Europe, Japan, China and other countries. He stated: “We will continue with our endeavor despite the criticism from various quarters because as a responsible government, we have to keep creating jobs for the people.” (Tanah Merah, “Govt Strives To Constantly Draw Investment To Malaysia, Says Mustapa,” Malaysian Digest, June 27, 2017,

A former Bank Negara Malaysia governor said that Malaysians should view China’s increasing investment rationally when evaluating the benefits to the country. She explained that whether Chinese investment is beneficial or not for the country would depend on the sector of investment. For example, China's investment in the manufacturing and infrastructure areas is positive for Malaysia. She also mentioned that Malaysians should realize that China is the world’s second largest economy now and that the country “has to manage its ties” with China well (“View China’s investments rationally, Zeti tells skeptical Malaysians,” The Malay Mail Online, June 24, 2017,


Chatrudee Theparat, “Boeing mulls EEC investment,” Bangkok Post, June 24, 2017,

Lamonphet Apisitniran, “EEC upbeat as 10 prominent firms sign up,” Bangkok Post, June 28, 2017,


Dennis Chan, “IE Singapore inks MOU to help Singapore firms expand presence in Sichuan (Chengdu) Free Trade Zone,” Strait Times, June 28, 2017,

Jacqueline Woo, “Singapore and Nanjing ink logistics partnerships amid rising consumer demand,” Strait Times, June 30, 2017,


“Vietnam’s auto industry still very small: working group,” VietnamNet, June 28, 2017,

“FDI inflow into Vietnam surges in year’s first half,” VietnamNet, June 28, 2017,

*The information used herein is gathered from sources believed to be reliable, but the Wong MNC Center does not guarantee their accuracy. The content in this section does not necessarily represent the official view of the Wong MNC Center, its Board of Directors, or its Advisory Board.