MNCs in the News-2017-09-08


The China Insurance Regulatory Commission (CIRC) said China would encourage foreign insurance firms to “enter China’s health, pension, and disaster insurance markets,” though it was unclear exactly what China or the CIRC would be doing regarding revamping existing regulations pertaining to foreign business establishment and licensing. At present foreign firms are limited in number and their total assets and share of the overall market small. China’s motivation for reform is to inject greater competition into the sector and control risks (Yang Qiaoling and Han Wei, “Regulator Invites Foreign Firms to Further Tap into Insurance Market,” Caixin, September 6, 2017,

In conjunction with the recently concluded BRICs gathering, State Grid of China, China and the world’s largest utility company and now Brazil’s largest power generation and distribution company, reported that it had invested more than USD $20.9 billion in Brazil. State Grid stressed not only that it helped Brazil bridge vast distances between Amazonian power generation facilities and high consumption areas, but also that it had introduced higher end technology power distribution lines (UHV transmission lines) and had become the largest investor in Brazil (Zheng Xin, “State Grid Becomes Power in Land in Brazil,” China Daily, September 5, 2017,


Kawasaki Heavy Industries of Japan is competing for a USD $3.2 billion contract to build subway cars for the New York’s state-run Metropolitan Transpiration Authority (MTA), the largest United States (US) transit agency by ridership. Kawasaki only faces competition from China’s CRRC Corp after the MTA deemed Germany’s Bombardier Transportation ineligible to bid on the deal. Kawasaki hopes its partnership with French supplier Alstom SA and its past work with the MTA will give it priority in securing the contract (“Kawasaki vying for $3.2 billion New York subway order, Japan Today, September 2, 2017,

Taiwan’s Foxconn Technology Group has joined the bidding process for Japanese chipmaker Toshiba’s USD $19.5 billion NAND memory technology. Foxconn’s consortium of Apple, SoftBank Group, Kingston Technology Co., and Sharp Corp. faces opposition from the Japanese government due to its close relationship with China. While Foxconn urges a decision from Toshiba on “technology terms, rather than political terms,” the company has experience in navigating government negotiations and emphasizes that the consortium is diverse and will allow Toshiba to maintain a 10 percent equity stake in the business (“Apple-Backed Billionaire Makes Case to Buy Toshiba Chip Unit,” Bloomberg, September 7, 2017,

South Korea

South Korea’s Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering lost a potential investment deal worth USD $1.5 billion from Mediterranean Shipping Company (MSC) due to elevated risk in the country after continuous North Korean missile tests. Despite Samsung and Daewoo offering a refund guarantee backed by the Korean Development Bank (KDB) in the event of a conflict, MSC believed a confrontation with North Korea would cause the KBD’s credit rating to fall and thus pulled out of the deal (Jung Min-hee, “N. Korea’s Missile Launch Hit Domestic Shipbuilding Industry,” BusinessKorea, September 7, 2017,

South Korea’s Hyundai Motors resumed operations at its Changzhou facility after disruptions in parts supply due to payment issues related to a Chinese backlash against South Korea’s deployment of the THAAD system that affected Hyundai’s sales and finances. Hyundai’s weakened situation has delayed the start-up of Hyundai’s new plant in Chongqing, China. Hyundai’s joint-venture (JV) partner, state-owned Chinese BAIC Motor, is pushing Hyundai to switch to Chinese suppliers, threatening that “losing the JV” is acceptable if supply problems can be fixed (Kim Bo-gyung, “Beijing Hyundai resumes operation of Changzhou plant, but woes persist,” The Korea Herald, September 8, 2017,


US based Freeport McMoran has confirmed additional investment of up to USD $20 billion for a new round of underground mining projects in Indonesia’s Grasberg mine due to depleting ore reserves. The first round of investment, around USD $750 million, will begin next year. The news comes after Freeport was able to resolve a dispute with Indonesia’s government by agreeing to divest a majority share in the mine. Freeport will retain control while continuing talks about future ownership of the mine (Robby Irfany and Putri Adityowati, “Freeport to Retain Control over Operations of Grasberg Mine,” Tempo, September 4, 2017,,uk.html/Freeport-to-R...)

Indonesia has recommended the Asia-Pacific Economic Cooperation (APEC) Forum increase cross-border investment in the Asia-Pacific region (APR) by supporting small and medium enterprises and reducing barriers for these companies. Indonesia’s APEC Director highlighted the ability of APR firms to address economic disparity in the region and boost job opportunities in member states. By improving free trade conditions, infrastructure connectivity, and e-commerce, Indonesian firms are poised for positive growth by the time APEC convenes in December to discuss further liberalization measures (Vicki Febrianto, “Indonesia urgers APEC to continue prioritizing MSMEs,” Antara News, September 2, 2017,


Thailand's small and medium-sized enterprises (SMEs) are being encouraged to invest in Myanmar, particularly Mandalay, because of the region’s plentiful natural resources, strong agricultural production and increasing demand for Thai products. According to a member of the executive committee of the Thai Business Association of Myanmar, there are “plenty of opportunities for Thai SMEs in many industries.” Mandalay, Myanmar's second-largest city, is a part of the Bangladesh-China-India-Myanmar (BCIM) economic corridor, a route that is associated with China's Belt and Road Initiative (BRI) (“Thai SMEs encouraged to invest in Mandalay,” Bangkok Post, September 8, 2017,


Vietnam’s Tien Phong Industrial Zone JSC and Russia’s Seaport of Azov signed a memorandum of understanding (MoU) to jointly build a Vietnam-Russia Industrial Complex with the support of the Vietnamese government. The JV is an outgrowth of the 20th Session of the Vietnam-Russia Intergovernmental Commission on Trading-Commerce and Science-Technology Cooperation, which is heavily attended by businesses of both countries. The MoU also reaffirms the commitment of Vietnam’s President Tran Dai Quang and Russia’s Vladimir Putin to their pledge of increasing bilateral investment by USD $10 billion (“Quang Ninh to get new port, industrial complex,” Vietnam News, September 8, 2017,

South Korean investment in Vietnam continues to soar as tariffs reductions from the ASEAN-Korea free trade agreement (AKFTA) come into effect. South Korean investment in Vietnam has totaled more than USD $6 billion since the start of the year. More Korean investment is on the way as small and medium size Korean firms move production facilities to Vietnam to serve South Korean conglomerates such as LG and Samsung. At pesent, LG and Samsung are both engaged in multibillion-dollar construction projects to build production facilities in the country (“Korea-deficit due to influx of high-end production lines,” Vietnamnet, September 8, 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.