MNCs in the News-2019-10-11


Responding to criticisms from Washington China was forcing American companies to “abandon their values,” a Chinese Ministry of Foreign Affairs spokesman stated China “will, as always, welcome foreign businesses…to invest and operate in China” and would “protect their legitimate rights and interests.” The spokesman highlighted China’s environment for “foreign investment has been improving” and stressed China remained a very popular investment destination. He noted American companies remain very profitable and queried, “‘are these…companies forced to give up their own values and have they all been manipulated?” (Zhou Jin, “Beijing Blasts Claims about Foreign Firms,” China Daily, October 11, 2019,

The China Securities Regulatory Commission (CSRC) recently made clear in an online statement its timetable for permitting 100 percent foreign direct investment (FDI) ownership stakes in fund management firms, brokerages, and futures companies. 100 percent stakes in futures companies will be permitted starting January 1, 2020. 100 percent fund management stakes will be allowed in April 2010. 100 percent brokerage stakes will be permitted starting on December 1, 2020. This timetable comes a short four months after Beijing stated it would remove limits (“China Announces Timetable to Lift Foreign Ownership Limits on Financial Firms,” China Daily, October 11, 2019,

United States (US) Senator Marco Rubio has sent a letter to the US Department of the Treasury requesting a national security review of China’s Beijing ByteDance Technology Co.’s, the owner of TikTok, acquisition of is based in Shanghai, but has an office in California and a large US user base. Per Rubio, a review is needed because there is “‘growing evidence’ TikTok’s platform is censoring content.” Rubio’s letter followed reports that in the Guardian that TikTok had censored sensitive videos (Katy Stech Ferek, “Senator Seeks Review of Acquisition by TikTok Owner,” Wall Street Journal, October 9, 2019,

Iran announced China National Petroleum Corporation (CNPC) has been dismissed from the South Pars field Phase 11 project. After Total withdrew in 2019 after the US rejected the 2015 nuclear accord and reinstituted sanctions, CNPC, which had a 30 percent stake, was the only international partner left. It is not entirely clear why, but sanctions may have something to do with the fact that CNPC “had not carried out any of its share of the work” per Iranian government representatives (Arsalan Shahla and Verity Ratcliffe, “CNPC Quits Flagship Iran Gas Project as U.S. Sanctions Bite,” Bloomberg, October 6, 2019,


Japanese and South Korean officials will meet soon in Geneva to have consultations relating to a complaint South Korea filed with the World Trade Organization pertaining to Japan’s imposition of more rigorous export controls over various materials used for semiconductors and display panels. South Korea charges that Japanese trade restrictions are nothing more than retaliation for South Korea’s Supreme Court requiring Japanese companies to pay compensation for wartime labor. Since its imposition of tighter export controls, Japan has approved seven shipments of restricted materials (“South Korea and Japan to Hold Talks over Trade Dispute on Friday,” October 10, 2019,

Pressure from entities like the United Nations and Organization for Economic Cooperation and Development is pushing Japanese companies to pay greater attention to corporate social responsibility (CSR) in their supply chains. Japanese businesses also see CSR’s value in terms of appealing to Generation Z and avoiding boycotts and lawsuits. Japanese companies “still lag their Western counterparts,” but firms like Ajinomoto, Fuji Oil, and ANA are working with non-governmental organizations (NGOs), local groups, and local subsidiaries to monitor the treatment of workers (Ryo Yamaoka, “Human Rights in Southeast Asia Supplies Become Priority in Japan,” Nikkei Asian Review, October 6, 2019,

South Korea

For the first time in five quarters, Korea has experienced an increase in inward FDI (IFDI) volumes. According to Korea’s Ministry of Trade, Industry, and Energy, third quarter IFDI was USD $3.61 billion, an increase of 4.8 percent year-over-year. There was strong growth in FDI flowing into new industrial sectors such as high-tech materials, components, and artificial intelligence. The trade war with Japan seems to have something to do with current FDI trends. FDI pledges are expected to reach $20 billion for 2019 as a whole (Jung Suk-Yee, “FDI in Korea Rebounds in Five Quarters,” BusinessKorea, October 11, 2019,

Increased investment in semiconductors in China seems ill-advised given the current US-China trade war and extreme competition in certain segments of the chip market. Nevertheless, Samsung Electronics still is seriously considering building a second NAND flash memory plant in Xian. The reasons are diverse. The Chinese government has given Samsung economic incentives such as tax breaks and land to build a second plant; China wants more domestic production; and Chinese companies need more chips. The investment could run as high as $2.5 billion (Kim Eun-Jin, “Samsung Electronics Considers Additional Investment in Semiconductor Plant in Xian,” BusinessKorea, October 10, 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.