MNCs in the News-2019-02-22


With Beijing seeking to expand ties with Riyad in the background, Saudi Arabia’s national energy company Saudi Aramco will sign a memorandum of understanding (MOU) during the visit of Saudi Arabia’s crown prince to China this week. The MoU calls for the construction of two oil refining and petrochemical complexes in Liaoning in a joint venture with China’s Norinco. The deal could help Saudi Arabia regain its place as the top oil exporter to China (Chen Aizhu, Rania El Gamal and Meng Meng, “Saudi Aramco to sign China refinery deals as crown prince visits: sources,” Reuters, February 21, 2019,

Shanghai’s municipal government measures to foster a better business environment and energize market players yield impressive results as the city maintained strong foreign investment growth despite a challenging environment. The Shanghai Municipal Commission of Commerce stated that Shanghai contracted USD $1.4 billion of foreign capital in January 2019, up 33.5 percent versus the prior year period. Commercial, science and technological services received the most foreign direct investment (FDI), which grew 197.6 percent year-on-year, with Shanghai receiving a total of $10.1 billion from January 2018 to January 2019 (“Shanghai starts new year with soaring FDIs,” China Daily, February 21, 2019,

BIStel, a South Korean provider of smart manufacturing solutions, said it will expand its FDI in China under the “Made in China 2025” initiative. BIStel’s decision comes when other manufacturers are moving from China to Southeast Asia as a consequence of the United States (US)-China trade war. A BIStel director said that, “we treat China as our biggest target market. We are making the investment based on the demand we see” (Celia Chen, “South Korean smart solutions firm BIStel says Made in China 2025 upgrading is why it plans to invest more,” South China Morning Post, January 18, 2019,

According to China’s Ministry of Commerce (MOFCOM), Chinese non-financial outbound FDI (OFDI) in 47 countries participating in the Belt and Road Initiative (BRI) totaled $1.33 billion in January, representing a 8.1 percent year-over-year increase. More generally, MOFCOM data showed the country’s non-financial ODI in 973 overseas companies in 137 countries reached a total of $9.19 billion in January (“China's outbound direct investment in B&R countries up 8.1% in January,” China Daily, January 21, 2019,

Despite uncertainties over Brexit, Chinese companies remain interested in investing in the United Kingdom (UK). This is so because “Britain’s tradition of welcoming foreign investment, along with its international capital market and availability of talent and professional services, are attractive to Chinese investors.” According to law firm Baker McKenize and the Rhodium Group, last year Britain received $4.94 billion in Chinese OFDI (COFDI), surpassing even the historically biggest recipient of COFDI, the United States (Cecily Liu, “Chinese companies look to invest in Britain,” The Telegraph, February 21, 2019,


Tokyo is considering financially backing Russian gas company Novatek’s Arctic liquefied natural gas project in the hopes of bolstering Japan’s negotiating position in territorial talks with Moscow through economic cooperation. However, the fate of any deal hinges on whether major Japanese trading houses Mitsubishi Corp. and Mitsui & Co.’s decide to invest in the $27.1-36.1 billion project. Moscow has intensified efforts to lure Mitsubishi and Mitsui by offering tax and other special incentives to the companies (Yukihiro Sakaguchi, “Japan eyes support for Russia LNG project amid territorial talks,” Nikkei Asian Review, February 19, 2019,

An increasing number of Japanese automakers are leaving or reconsidering their position in the UK with now less than 40 days until Brexit. Honda Motor Co. announced last week it will close its only factory in Britain in 2021 while Nissan Motor Co. announced earlier this month it was scrapping plans to manufacture a new sport utility vehicle at a factory in central Britain. For its part. Toyota Motor Corp. is considering temporarily halting production in the event of a no-deal Brexit (Yu Toda and Naoki Kawaguchi, “Widespread Brexit looming in business world,” The Japan News, February 20, 2019,

South Korea

Seoul is expecting the second US-North Korea summit to include some easing of sanctions in return for steps toward denuclearization and an approval of inter-Korean projects including a Korea peninsula rail link. In a phone call with Trump last week, President Moon Jae-in reiterated Seoul’s wish to move forward with the rail link and other unspecified economic projects with Pyongyang. The rail link would not only benefit Kim, but allow Seoul to link up with China’s Belt and Road Initiative (Kyunghee Park and Youkyung Lee, “Trump-Kim Summit Rekindles Dreams of Korean Rail Link with Asia,” Bloomberg, February 22, 2019,

India and South Korea agreed to enhance cooperation in diverse economic and security areas, during Indian Prime Minister Narendra Modi’s visit to South Korea. As far as investments are concerned, they agreed to continue operations of Korea Plus, an organization that facilitates investments by Korean companies in India and cooperate in promoting collaboration among start-ups. They also signed an agreement to facilitate technical and institutional knowledge exchange in road and transport to promote bilateral cooperation in India’s road and transport infrastructure development projects (“India, South Korea sign MoUs in key areas of trade, investment, security,” CNBC, February 22, 2019,

*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.