MNCs in the News-2018-01-08


This year, it is expected China’s pharmaceutical authority, the China Center for Drug Evaluation, will approve blockbuster foreign drugs from pharmaceutical companies such as AstraZeneca, Bristol-Myers Squibb, and Novartis. This relates in part to the Center’s effort to speed up the drug approval process to ensure innovative or seriously needed drugs can enter the market more quickly. Foreign firms will benefit not only in their capacity as drug developers, but also the entities doing distribution and marketing for other firms including Chinese ones (Coco Feng, “China Expected to Approve Several Foreign Blockbuster Drugs in 2018,” Caixin, January 2, 2018,

Hyundai Motor Group is predicting slow auto sales growth for 2018 due to tepid global economic growth and “‘spreading protectionism in major trading partners.’” Last year, Hyundai’s sales in China noticeably dropped because of political frictions relating to Korea’s decision to deploy the THAAD anti-missile system. Not only will this remain a drag on the firm’s sales, but it also faces increasing competition from domestic and foreign players in China, government support for local companies, and a late launch of its electric vehicles (Mo Yelin, “Hyundai Cuts Global Sales Target as Firm Struggles in China,” Caixin, January 2, 2018,

The State-Owned Assets Supervision and Administration Commission (SASAC) regulatory bureau announced “China plans to issue management guidelines to crack down on commercial bribery and tighten rules on product quality and environmental protection.” Such measures would help address a gap in regulation that results in a lack of “effective supervision” over the overseas activities of Chinese state-owned enterprises (SOEs). The new system also will “provide a guidance and risk warning system on overseas investments and direct SOEs to make better-informed decisions” and punish “unfair competitive practices” (Zhong Nan, “Measures to Help Halt SOEs’ Overseas Errors,” China Daily, January 3, 2018,

The United States (US) Committee on Foreign Investment in the United States (CFIUS) blocked China’s Ant Financial, owned by Alibaba Group Holding Ltd., planned purchase of American money transfer company MoneyGram. Ant Financial and MoneyGram ended their deal reportedly because CFIUS would not accept “their proposals to mitigate concerns over the safety of data can be used to identify U.S. citizens.” CFIUS’s rejection may be associated with increasing US political and economic pressure on China and growing concern about cybersecurity issues (Greg Roumeliotis, “U.S. Blocks MoneyGram Sale to China’s Ant Financial on National Security Concerns,” Reuters, January 2, 2018,


Japan’s Toshiba Corp finally sold its floundering American nuclear business Westinghouse (but not reactor projects in George and South Carolina) to Canada’s Brookfield Asset Management Inc. for USD $4.6 billion. Westinghouse had been struggling after tighter regulations and cost overruns stalled many of its projects. The US Donald Trump Administration reportedly had been pushing for Saudi Arabia to buy reactors from Westinghouse and other American companies, problematic because prior agreements preclude enriching uranium for use in nuclear projects (“Tiffany Kary and Scott Deveau, “Brookfield agrees to buy Westinghouse’s global nuclear business from Toshiba,” The Japan Times, January 5, 2018,

The judge overseeing the bankruptcy case of Takata Corp.’s US unit TK Holdings Inc. has reviewed the adequacy of TK Holdings Chapter 11 plan and will soon decide if the plan is “fair and meets other requirements.” If so, the company will be able to make payouts to claimants who suffered from its faulty airbags. Takata plans to sell certain assets to China’s Ningo Joyson Electric Corp for USD $1.6 billion and moneys raised will support court ordered and other claims (Tom Hals, “U.S. judge clears Takata to seek creditor vote on bankruptcy plan,” Japan Today, January 5, 2018,

South Korea

South Korea’s Ministry of Trade, Industry and Energy and South Korean appliance makers Samsung Electronics and LG Electronics urged US policymakers to reconsider the US International Trade Commission (ITC)’s recommended 3-year 50 percent tariff on imported Korean washers that exceed a 1.2 million unit threshold. LG has reaffirmed its intent to go ahead with its planned construction of US manufacturing facilities while Samsung said it planned to supply more washers from the US over time. Ultimately, President Trump will decide on the ITC recommendation (Kang Seung-woo, “Korea protests US trade restrictions on washers,” The Korea Times, January 4, 2018,

South Korean retailer Lotte Group is still struggling to shed its Chinese hypermarket chain after talks with Thailand’s Charoen Pokphand Group failed to yield agreement on a sale price. Beijing and Seoul have been unable to mend ties fully after the deployment of a US anti-missile system in South Korea which brought heavy pressure on Lotte’s China operations. Beijing tourism authorities, although lifting bans on Chinese tours to South Korea, have reportedly forbade tours from visiting Lotte affiliates like hotels (“Lotte faces bumpy road to sell off its discount store chain in Chain,” The Korea Herald, January 3, 2018,


Indonesia’s state-owned energy company Pentamina took back Indonesia’s largest oil and gas block, the Mahakam block, from France’s Total E&P Indonesie and Japan’s Inpex which were the block’s contractors for 50 years. Pertamina will retain all their employees and build on the work the contractors have done. The takeover will allow Pentamina to produce more than 30 percent of Indonesia’s oil and gas in 2018 and help Jakarta expand its control over domestic energy production (Whisnu Bagus Prasetyo, “Pertamina Takes Over Operation of Indonesia’s Largest Oil and Gas Field,” Jakarta Globe, January 1, 2018,

Indonesia’s Investment Coordinating Board (BKPM) is aiming to achieve 10 to 14 percent year-on-year growth in foreign direct investment (FDI), targeting the e-commerce and services sectors. To facilitate these goals, it is further reducing the documentation needed to register investment and shortening the time needed to obtain a business license from three days to one. The BKPM also is digitalizing more investment licensing materials and recently released a comprehensive digital document for investment and licensure to create a “One Stop Service” for investors (“Principle License Replaced by Investment Registration,” Indonesia Investments, January 3, 2018,


Continuing Bangkok’s “Thailand 4.0” initiative to develop the economy through high tech industries, Thailand’s Board of Investment expects FDI into its Eastern Economic Corridor (EEC) to reach more than USD $18 billion in 2018. Thailand’s eastern provinces of Chon Buri, Rayong and Chachoengsao will be transformed into “ready-to-invest” industrial zones as new EEC policies are implemented and foreign companies become familiar with EEC requirements. Thailand’s government expects the first EEC law dictating business activities in its eastern region to be released in the first quarter of 2018 (Lamonphet Apisitniran, “High hopes for EEC investment,” Bangkok Post, January 1, 2018,


Chinese FDI into Malaysia is expected to move out of infrastructure and property development and into new sectors as China’s Belt and Road Initiative builds partnerships and boosts people, information, and technology transfers. Though there are some domestic concerns over an overreliance on Chinese investment for infrastructure, Kuala Lumpur continues to welcome Chinese firms. Chinese FDI into Malaysia has also continued unabated in recent years despite the implementation of new capital controls by Beijing to stabilize the Chinese Yuan (Ganeshwaran Kana, “Chinese investments in Malaysia likely to diversify into more sectors in 2018,” The Star Online, January 1, 2018,

According to Japan’s Ambassador to Malaysia, Japanese firms are poised to win the bid for a high-speed rail (HSR) project worth more than USD $8.7 billion that would connect Kuala Lumpur to Singapore. He stressed Japan was willing to share advanced technology with both Malaysia and Singapore and help them improve human capital development, both which would further the former’s goals of avoiding the “Middle-Income Trap.” China is vigorously competing to win the Kuala Lumpur–Singapore HSR project (“Japan stands good chance of winning KL-SG project, says Envoy,” New Straits Times, January 3, 2018,


Vietnam’s Ministry of Transport has set a new deadline for the Chinese-funded Cat Linh rail project that has been delayed for more than two years. The rail project, relying heavily on a Chinese contractor and Chinese investment, was initially expected to cost USD $552 million and be completed in 2015. Per latest figures, the rail line will cost more than USD $860 million, but will receive extra capital injections from China to cover material and machinery requirements (“Vietnam gives new deadline to sluggish Chinese-funded urban railway in Hanoi,” Tuoi Tre News, December 30, 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.