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MNCs in the News-2019-09-20

Despite falling global foreign direct investment (FDI), China continues to show strength in attracting inward FDI (IFDI). Shanghai continues to be a magnet not only for IFDI, but also for regional headquarters and research and development facilities. The United States (US) has issued a regulation that will give the Committee on Foreign Investment in the United States new powers to scrutinize FDI which many believe are directed at China. US Senators send Federal Communications Commission a letter asking it to review the operating licenses of Chinese telecommunications providers in the US. Japan’s Fair Trade Commission (FTC) pushes Internet companies “to create a system to eliminate fake news and discriminatory postings.” Regarding Korea’s recent filing of a World Trade Organization complaint related to Japanese export controls, Japan has agreed to consultations. Korea FTC to decide if it will accept Apple Korea’s pledge to fix its alleged illegal collection of advertising fees from mobile carriers. Korea Electric Power Corp.’s coal mine development project in New South Wales rejected by Australia’s Independent Evaluation Committee.

MNCs in the News-2019-08-30

China’s plan to apply its social-credit system to foreign companies is raising concerns about possible abuses. China’s State Council announces it will establish pilot free trade zones (FTZs) in Shandong, Jiangsu, Guangxi Zhuang, Yunnan, Hebei, and Heilongjiang. United States (US) companies likely to stay in China despite trade war, a problematic regulatory environment, and US President Donald Trump’s call for them to leave. Although frictions over maritime issues remain unsettled, Chinese President Xi Jinping proposes joint oil & gas development in Reed Bank area to visiting Philippines’ President Rodrigo Duterte. Japan is paying more attention to tax shifting activities by high-tech companies and has recently forced Facebook to pay more in taxes for some questionable tax shifting activities. After the 7th Tokyo International Conference on African Development (TICAD), Japan and 53 African countries signed the Yokohama declaration which stressed “‘quality infrastructure investment.’” South Korea’s new policy for network fees has led to frictions with Facebook and service problems that led to fines which Facebook fought successfully in court. The Korea Startup Forum, the Korea Internet Corporations Association, and local and foreign content providers have called upon the South Korean government “to completely overhaul its network fee calculation structure.”

MNCs in the News-2019-07-19

Reports suggest that following intensifying China-United States (US) trade frictions, a growing number of foreign multinational corporations (MNCs) are considering moving their manufacturing out of China. At a recent China State Council meeting, officials state China aims to provide better intellectual property rights (IPR) protections and that it will treat domestic and foreign firms equally. China courts Japan’s involvement in the Belt and Road Initiative (BRI) purportedly to improve the BRI’s image. Bangladesh works to calm foreign investors in the wake of a violent clash between local and Chinese workers at the Chinese-invested Payra thermal power plant. Japan’s Fair Trade Commission (FTC) moves forward on guidelines to regular IT giants’ use of personal data without consent. Korea preparing plan to “‘to reduce the country’s dependence on Japan’s materials, components and equipment industries.’” Korean firms threatened by possibility that Japan will “remove Korea from its export white list.” Hyundai Motor Co. and Hyundai Motor America have requested the US International Trade Commission to start an investigation against four auto part importers.

MNCs in the News-2019-05-24

China’s Cyberspace Administration releases draft document stating, “operators of the country’s critical information infrastructure…will be required to take into account national security risk when purchasing foreign products and services.” A recent European Union (EU) Chamber of Commerce in China survey suggests the problem of forced technology transfers in China has worsened. The US is considering cutting off the flow of American technology to five other Chinese firms putatively because of these companies’ role in supporting Beijing’s actions in Xinjiang. With the United Arab Emirates (UAE) aiming to become a major China’s Belt and Road Initiative (BRI) partner, China’s East Hope Group conglomerate contemplates $10 billion port investment there. China’s chargé d'affaires in London warns if Huawei banned from Britain’s 5G network there might be “substantial” repercussions for Chinese foreign direct investment (FDI) in the United Kingdom (UK). The Japan unit of US e-commerce giant Amazon has decided to stop direct sales of all Huawei products through its online store. Mizuho Financial Group Inc. said it will tighten standards for lending to coal-fired power plants with high emissions of CO2. Renault Samsung workers in Korea reject draft wage and bargaining agreement which may lead to an “indefinite all-out strike” that drives the joint venture’s upcoming XM3 production to Spain. Iraq’s Ministry of Petroleum awards Korea’s Hyundai Engineering and Construction a $2.45 billion contract to build a seawater supply facility in Iraq.

MNCs in the News-2019-04-12

Recent report forecasts massive increase in China’s inbound mergers and acquisitions (M&As) between 2020 and 2029. Pursuant to its trade negotiations with the United States (US), China considers eliminating entrance barriers to its cloud computing market like requiring overseas companies to form joint ventures (JVs) with Chinese firms. Chinese and European Union (EU) leaders commit to conclude a bilateral investment treaty (BIT) by next year. At the summit of Central and Eastern European countries and China in Dubrovnik, Greece announces it will join China’s 16+1 Initiative. Following the EU and United Kingdom’s delay of Brexit by six months, Tokyo pledged to continue to lobby against a no-deal Brexit and to monitor developments. Regarding the Carlos Ghosn case, France stressed to Japan that it respects the sovereignty of Japan’s judicial system and also would provide consular protection to Ghosn. Korean companies lobby their government to deal with the EU’s growing pressure on South Korea to ratify key International Labor Organization (ILO) conventions

MNCs in the News-2018-12-14

Inward foreign direct investment (FDI) into China for the first 11 months of 2018 year-over-year relatively stable. Beijing stops requiring its local governments to support the Made in China 2025 policy. European Union Ambassador to China calls on China to stop requiring companies to transfer technology for market access. Apple considers moving some production out of China due to possibility of increased tariffs on its China-produced smartphones and laptops. 2018 proves a tough year for Chinese outward FDI (OFDI) in the oil sector. Huawei accepts various UK technical requirements “to address risks in its equipment and software.” Following a Japanese government’s decision that effectively excluded China’s Huawei Technologies Co. and ZTE Corp. from public procurement, Japan’s three major mobile phone carriers Softbank Corp., NTT Docomo Inc., and KDDI Corp. plan to stop using various products from these companies. Japanese expert panel calls on Tokyo to take measures to protect the usage of consumer data. Korea Electric Power Corp. report on Northeast Asia power grid notes it would face serious challenges because of sanctions on North Korea. Beginning July 2019, Korea will impose a value-added tax on a wider range of services provided by global technology giants to level the playing field for Korean firms.

MNCs in the News-2018-11-16

China’s Ministry of Commerce (MOFCOM) reported October inward foreign direct investment (FDI) flows reflected a 7.3 percent rise over the previous year. MOFCOM looks to aid Chinese private companies invest overseas albeit in an “orderly,” guided way. German officials are pressing their government to hang up on Chinese corporate participation in the country’s early 2019 5G spectrum auction. American Enterprise Institute report suggests Belt and Road Initiative investment by Chinese companies is losing steam. Tokyo reassures Japanese businesses of its opposition to any actions requiring Japanese companies to pay compensation to forced laborers, saying the matter was settled in 1965. Japan succeeds in getting member countries of the Asia-Pacific Economic Cooperation (APEC) forum to adopt new guidelines relating to the quality of infrastructure development and investment. Korean price rigging conspiracy at US military bases in Korea fuels massive USD $200 million in criminal and civil penalties. South Korean legislatures considers broadened value-added tax on global information and communication technology companies to create a level playing field for Korean firms.

MNCs in the News-2018-10-26

China’s Ministry of Commerce (MOFCOM) says the country will accelerate its efforts to pass a new foreign direct investment (FDI) law that promotes and protects FDI. China’s Supreme People’s Court plans to act to improve the intellectual property rights protection system in China. Following Apple, Amazon and Super Micro call on Bloomberg to retract its story about Super Micro hardware hacked by Chinese intelligence agencies. United States (US) asset sellers and brokers turn away from Chinese buyers because of the delays and uncertainties that arise when Chinese companies are involved in FDI in the US. Multinationals contemplate moving supply chains out of China if the impact of US tariffs on China becomes too severe. Despite his close links with Saudi Arabia, Masayoshi Son cancels his speech at the Future Investment Initiative after Saudi Arabia admits the killing of journalist Jamal Khashoggi. US Committee on Foreign Investment in the United States torpedoes sale of Japanese Italian subsidiary to a Chinese firm on unclear grounds. Fears of the adverse economic impact of the US-China trade war, US rate hikes, and rising oil prices spur Seoul to announce economic package to fuel jobs and investment. Korean builder Dealim Industrial wins major engineering, procurement, and construction ammonia plant deal in Saudi Arabia.

MNCs in the News-2018-09-21

China takes a softer stance on dominating the Artificial Intelligence (AI) sector at the World AI Conference in Shanghai. Summer Davos observers and participants stress the progress of the [China] Greater Bay Area in attracting foreign direct investment (FDI). Alibaba’s Jack Ma retreats from promise to create 1 million jobs in United States (US). Germany looks to pursue more measures, including a billion euro investment fund, to control Chinese FDI flows into the country. Japanese chemical firms boost FDI in Southeast Asia to ramp up production to fill the space flowing from reduced production of Chinese firms that cannot meet China’s environmental requirements. Building upon the foundation created by Japanese and Indian leaders, Japanese companies and investors are pouring money into India to support IT startups. South and North Korea agreed to take steps to reconnect infrastructure links and restart discontinued inter-Korean projects. South Korea’s Hyundai Engineering signed Memoranda of Understanding with Indonesian officials regarding the expansion of its industrial facilities and the construction of a hydroelectric power plant there.

MNCs in the News-2018-06-15

Investigation reveals Foxconn factory in China supplying Amazon products has serious problems regarding labor conditions. Chinese outward foreign direct investment (FDI) for first five month of 2018 shows impressive growth over 2017. China’s SF Motors drives ahead in effort to build electric vehicle manufacturing plant in Indiana (United States). Fears about potential Chinese dominance lead Vietnam to protest their government’s special economic zones plan. Japanese firms making own deals with American states that “go their own way” in pursuing investment opportunities. Mexico’s Economy Minister visiting Japan as country seeks to diversify investment and exports amid NAFTA talks impasse. Korean firm announces $1.7 billion investment plan for liquefied natural gas infrastructure in Philippines following President Duterte’s recent Seoul visit. South Korean construction companies forming task forces and planning investments in North Korea following US and North Korea summit. Mahathir set to “woo investors and offer business deals” during recent Japan visit. Malaysian state Perak to cooperate with EU to strengthen investment cooperation.

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