MNCs in the News-2018-06-01


China’s Ministry of Commerce (MOFCOM) reported inward foreign direct investment (FDI) for the first four months of 2018 totaled roughly $45 billion, a 0.1 percent increase year-over-year. There was very strong inward FDI (IFDI) growth in the medical equipment manufacturing sector which showed a 322 percent annual growth rate over the first four months of 2018. The sector’s impressive IFDI growth was attributed to a growing market and favorable IFDI policies nationally and in regional zones like the Shanghai Free Trade Zone (Ren Xiaojin and Zhong Nan, “High Tech Leads Foreign Direct Investment Growth,” China Daily, May 29, 2018,

Trade tensions between China and the United States (US), increasing US regulatory scrutiny of deal like those involving Lattice Semiconductor and Moneygram, and problems surrounding Chinese companies like ZTE likely will have serious implications for Chinese companies pondering investments in the US. For those determined to invest, there might be “much lengthier and more complex procedures to have merger and acquisitions approved by the US government.” For others, the new environment will deter them from contemplating investing in the US (Li Xiang and Shi Jing, “Testing Times Ahead for Chinese Investment in the US,” China Daily, May 29, 2018,

The international trade committee of the European Parliament has voted to push for an expanded list of sectors (including media, data analysis, and automobiles) and deals requiring European Union (EU) scrutiny and the European Commission (EC) and EU countries to coordinate their review mechanisms. Members of the committee will start talks with the EC and European Council of Member States to get legislation passed by the end of 2018. It is not clear if parliament and member states will respond positively (Philip Blenkinsop and Noah Barkin, “EU Lawmakers Push to Toughen Screening of Foreign Investments,” Reuters, May 29, 2018,

The Chinese Academy of Social Sciences Research Center for Corporate Social Responsibility has published China’s first research report on central state-owned enterprises (SOEs) corporate social responsibility (CSR) practices. The report noted central SOEs CSR efforts often go unnoticed due to a lack of public relations. The report recommended central SOEs work more closely with local charitable organizations to disseminate their message. The report contends central SOEs have been doing a ‘good job in environmental protection,’” for example, by adopting the latest technologies abroad (Liu Yukun, “China’s 1st Report on SOE Overseas Social Responsibility Published,” China Daily, May 25, 2018,


Japanese contractors were blindsided by Malaysia’s decision to scrap a planned USD $14.8 billion high-speed rail link from Kuala Lumpur (Malaysia) to Singapore. Alongside bidders from China and Western nations, a Japanese consortium including East Japan Railway and Sumitomo Corp. was looking to land contracts that were to be awarded by the year’s end. Japan’s high-speed rail industry had high hopes in exporting shinkansen bullet trains to Malaysia in the face of increasing regional competition with China’s CRRC (Keigo Iwamoto and Tomoya Ushiyama, “Malaysia high-speed rail cancellation a blow to Japan’s ‘shinkansen’ exports,” Nikkei Asian Review, May 30, 2018,

Government representatives of China, Japan and Thailand recently announced their intentions to pursue business collaboration in the Eastern Economic Corridor (EEC), a special economic zone heavily promoted by the military junta. The decision came as a result of a Sino-Japanese agreement signed early in May to set up a private-public body that promotes joint operations of Japanese and Chinese enterprises in third countries. While Thailand’s focus in the EEC is infrastructure development, it also identified human resource development as another area for potential Sino-Japanese cooperation (Yukako Ono, “Thailand to benefit from China-Japan thaw,” Nikkei Asian Review, May 31, 2018,

South Korea

US President Donald Trump could impose new tariffs on foreign car and vehicle component imports after the conclusion of a national security review. US automotive company General Motors’ (GM) $7 billion rescue plan for its South Korean plants is now in jeopardy because the company relies on exports from its Korean operations. Before the Trump Administration announced its auto investigation, GM had planned to build two new models in South Korea with the intention to export them to the American market (Hyunjoo Jin, “Trump’s Auto Tariff Plan Threatens GM’s $7 Billion South Korea Rescue,” U.S. News, May 30, 2018,

Hanwha Q CELLS Korea announced it signed a memorandum of understanding with the Whitfield County government of Georgia (US), to construct a solar module production facility. While the US is the world’s second solar largest market, US President Donald Trump imposed a 30 percent solar safeguard tariff last February, which decreased the viability of imported solar technologies. Georgia’s state and local governments previously had awarded Hanwha over $30 million in land as well as property and corporate tax breaks for the facility (Jung Min-hee, “Hanwha Q CELLS to Build Solar Module Plant in the US,” BusinessKorea, May 31, 2018,


Malaysia’s Prime Minister Mahathir Mohamad announced he was reconsidering the terms of a $14 billion rail deal involving Chinese partners because he felt reducing his country’s ballooning national debt was a higher priority. Not only did Mahathir deem the current terms “very damaging” to the Malaysian economy, he also has questioned the need for the project at all. Malaysia further will be looking into how it can reduce the cost of any potential exit from a $17 billion high-speed rail deal with Singapore (John Geddie, “Malaysia renegotiating terms of major Belt-and-Road rail project: PM Mahathir,” Reuters, May 26, 2018,

Malaysia’s state-owned oil and gas company Petronas announced it will become the second-largest partner in a Canadian liquefied natural gas (LNG) export project by buying a 25 percent stake. Last July, Petronas cancelled its plan to invest in the Pacific NorthWest LNG project worth $28 billion. The new LNG Canada project led by Shell is a $31 billion project involving Canadian, Japanese, and Chinese stakeholders. Petronas’s deal fits its aim to build a long-term Canadian presence (Cecilia Kok, “Petronas to buy 25% in LNG Canada, estimated to cost RM111bil,” The Star, June 1, 2018,

*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.