MNCs in the News-2017-09-15


The lure of the China electric car market is causing leading auto firms like General Motors and Volkswagen to shift related production, research & development (R&D) activities, and operations to China. Beijing is exploiting diverse means to encourage foreign companies to sell electric cars in China and to share technologies and knowledge in a bid to move up the value added chain, reduce dependencies on foreign technologies, and fight pollution. Foreign companies dismiss the worries or say sharing is needed (Keith Bradsher, “China’s Electric Car Push Lures Global Auto Giants, Despite Risks,” The New York Times, September 10, 2017,

A senior official with the National Development and Reform Commission, cited in the China Daily, stated that “China will blacklist companies that violate investment rules as part of a wider crackdown on ‘irrational and unauthentic’ foreign acquisitions.” Not only will this blacklist be shared across government departments, but “blacklist companies will receive punishment if they become ‘discreditable’ to regulators. China already had begun to institute limits on outward foreign direct investment (FDI) last year with its State Council approving a package of regulations in August (Alice Woodhouse, “China to Blacklist Companies Violating Overseas Investment Rules,” Financial Times, September 14, 2017)

United States (US) President Donald Trump, on the basis of a recommendation from the Committee on Foreign Investment in the United States (CFIUS), recently blocked Canyon Bridge Capital Partners LLC, a private-equity firm backed by a Chinese state-owned asset manager, from investing in Lattice Semiconductor, a leading firm in programmable logic chips, ostensibly because of national security risks. This is only the 4th time over the last 25 years that a US president has terminated a bid for national security reasons (David McLaughlin and Jennifer Jacobs, “Trump Blocks China-Backed Bid for Lattice over Security Risks,” Bloomberg, September 14, 2017,

The European Commission “has come up with a pan-European scheme to vet sensitive purchases by other countries.” Unlike CFIUS, its decisions will not be binding. The move came after pressure from France, Germany, and Italy, which have been growing increasingly worried about China’s acquisition of leading technologies and know-how. A related concern is that China might use an acquisition in a European Union (EU) country without a review process for non-EU investors as a platform to circumvent the review process in countries that do (Lisa Jucca, “Breaking Views-EU Foreign Investment Review Raises Bar for China,” Reuters, September 14, 2017,


Thailand’s military junta, which is currently in control of the country, has assured Japanese investors a proposed plan for a USD $45 billion injection into Thailand’s Eastern Economic Corridor would proceed regardless which political party came to power during the next election. Though no date has yet been set for elections, Thailand’s leaders are determined to calm investors interested in Thailand’s “Detroit of Asia,” which contains the regional headquarters for many Japanese businesses such as Toyota Motor Co. (“Thai junta tells Japan investors $45-billion development plan to go ahead,” Japan Today, September 13, 2017,

Suzuki Motor will invest more than USD $175 million into a lithium ion battery facility in Gujarat, India, and more than USD $590 million to expand its electric vehicle (EV) plant production plant in Ahmedabad. Suzuki is partnering with two other Japanese firms, Toshiba and Denso, to produce EVs in line with the Indian government’s “Make in India” initiative to localize production of high tech manufacturing and to meet a government directive to exclusively sell EVs by 2030 (Sharmistha Mukherjee, “Suzuki to set up India’s first Lithium Ion battery unit with Toshiba & Denso,” Economic Times, September 14, 2017,

South Korea

South Korea’s Hyundai Motor has released plans for an electric vehicle manufacturing plant in India. News about the EV plant, which will start construction next year, comes in the wake of the Indian government’s pledge to ban sales of non-EV cars by 2030 and to build EV charging stations. Hyundai is investing early to exploit India’s growing car market which is expected to be the third largest by 2020, allowing the Korean firm to solidify its position as the second largest carmaker in India (Jung Min-hee, “Hyundai Motor to Build EV Assembly Plant in India,” BusinessKorea, September 11, 2017,

South Korean retail giant Lotte Group has begun making plans to sell its 112 China based Lotte Mart stores following six months of forced closures. Both Chinese government imposed unofficial sanctions using sanitary inspections and consumer resentment over missile system installation at a Lotte Group property have caused the South Korean company to invest more than USD $600 million to maintain its Lotte Marts. Facing prospects of further losses and need inject further capital, Lotte has decided to pull out of China (“South Korea’s Lotte to sell China shops in face of boycott,” The Straits Times, September 15, 2017,


Indonesia’s state-owned State Electricity Corporation received USD $600 million in funding from the Asian Development Bank (ADB) to increase sustainable energy infrastructure in the country. Indonesia hopes to use the investment to build its Eastern economic corridor to serve as a major business and production hub for the region. The government also hopes that by providing stable energy infrastructure it can attract more foreign investment to the country as it competes with its Southeast Asian neighbors (Tomas S. Noda, “ADB launches $1.1b funding support for Indonesia energy programme,” Deal Street Asia, September 15, 2017,


With support from the Thai government, Chinese investment in various economic sectors including real estate, e-commerce, and tourism has increased quickly over the past few years. In particular, mobile payments in Thailand have been a very attractive sector for investors because of the national e-payment scheme. However, not everyone is pleased with the increasing influence of the Chinese. For instance in the field of tourism Chinese companies are seeking to “control the entire business.” If these firms succeed Thailand's overall tourism sector “will experience a hefty loss” (“China Inc’s relentless rise raises red flag,” Bangkok Post, September 11, 2017,


Thirty-three Vietnamese state-owned enterprises (SOEs) worth more than USD $3.5 billion were approved for government divestment earlier this year, but have encountered several issues despite being attractive targets for investment. Equity stakes in the Vietnamese SOEs have remained too small to be of strategic use, the purchasing process continues to be unclear, included assets are not communicated, and international pricing standards have not been followed. As a result, the Vietnamese government has divested only eight percent of holdings and foreign investors remain wary (Thanh Mai, “Foreign investors want to buy controlling interest in equitized SOEs,” Vietnamnet, September 15, 2017,

Vietnam’s southern province of Bến Tre is promoting investment in several industrial sectors in line with its government directed provincial development plan. Provincial government leaders have focused heavily on industrial infrastructure, such as office parks, to create favorable investment conditions. In addition, the local government is tuning policies regarding foreign investment to increase communication with investors and remove barriers to production and business. Bến Tre officials hope the new investment climate will attract foreign businesses into its growing agriculture and fishery processing industries (“Bến Tre to up industrial investment,” Vietnam News, September 13, 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.