ASEAN

American and other trade unions shake and flip over potential risks to McDonald’s workers after the firm sells its self-owned China stores to Citic and Carlyle Group. United States (US) moving to strengthen review processes to encompass Chinese investment through mechanisms that are not yet subject to Committee on Foreign Investment in the United States (CFIUS) review processes. Responding to news that US is striving to tighten the CFIUS review process, China calls on the US to avoiding politicizing “commercial takeovers.” Canyon Bridge files for third time for CFIUS review of its deal with Lattice Semiconductor. Thailand’s government may loosen licensing requirements for Chinese engineers working on Thai-Sino railway to the consternation of local engineer associations. Japan’s Maritime Air Systems and Technologies (MAST) show offers Tokyo venue to boost military sales with Southeast Asia. Japanese firms carefully evaluate business relations and assets in Qatar following country’s crisis. China blacklists 24 South Korean companies following continued anger over THAAD system. Daewoo Engineering and Lotte Engineering & Construction each sign MOU with Laos’s Petroleum Trading Lao Public Co for infrastructure projects. Indonesian government invites Chinese investors to participate in railway construction project in Bali. CAT Telecom infrastructure development plans continue to drive Thailand to be Greater Mekong Subregion’s digital hub. Lawsuit alleges money misappropriated from Malaysian state fund was used to finance USD $2.2 billion acquisition of US energy firm. Malaysian Minister announces that Malaysian companies will continue to invest in Indonesia. Vietnam’s Deputy Prime Minister encourages businesses from both countries to foster their investment partnership. Vietnam has come up with a new decree to deal with transfer pricing by multinational corporations.

Big foreign companies increasingly willing to voice complaints about the situation in China. China’s limits on capital outflows affect the willingness of some to invest in China. Beijing is considering “braking” the requirement capping foreign companies ownership in the auto sector to no more than 50 percent with some predicting a crash of domestic firms if this happens. China’s nonfinancial outward foreign direct investment (OFDI) experienced major drops in March over the prior year and over the first quarter of 2017 year-over-year (YOY). China’s One Belt, one Road (OBOR) initiative leads to the signing of a major number of transportation related accords. Sharp considers joint bid with Hon Hai on Toshiba’s memory chip unit as it seeks to mitigate national security concerns. Kia plans USD $900 billion car manufacturing plant in India to surmount India’s steep import duties and China’s anti-Korean economic sanctions. Malaysian trade mission to South Korea brings home Korean investment worth around USD $550 million. Malaysia seeks to increase its cooperation with New Zealand in IT and tourism sectors. Vietnam develops public-private partnership framework allowing more foreign investment particularly from Japan in its infrastructure sector. Hoang Son Trading Investment JSC partners with Spanish-Japanese joint venture to build new solar plant in Vietnam.

Inward FDI into China grew slowly over the first six months of 2016 year-over-year. The Permanent Court of Arbitration’s unfavorable ruling against China’s South China Sea claims sparks protests and boycott calls against American “icons” in China to the chagrin of the Chinese government. A Chinese consortium’s effort to buy the entire Opera Software company falls apart reportedly due to a failure to get sufficient Chinese government approvals. Japanese official travels to Singapore to tout the advantages of Japan high speed rail system for the Malaysia-Singapore high-speed rail project. South Korea’s Fair Trust Commission watchdog relaunches investigation into Google Inc.’s requirement that smartphone makers using its Android operating system preload its search engine. Indonesia’s Investment Coordinating Board (BKPM) is conducting a roadshow in Guangzhou to tout the country’s improving investment environment. Indonesia is working to help investors surmount problems that hinder them from realizing their investments and has developed special initiatives. The Malaysia Investment Development Authority (MIDA) is working on getting more companies to participate in its principle hub scheme. Vietnamese Deputy Prime Minister calls on his country to be more selective in its FDI attraction efforts and to work on getting better FDI.

Shanghai Zhangjiang National Innovation Zone allows new possibilities for foreign pharmaceutical companies to focus on their core competencies. Sharp’s acceptance of a buyout bid from Foxxconn suggests Japan really may start to welcome more foreign direct investment (FDI). Japan’s Mitsubishi willing to do all work in Australia to win major Australian next generation submarine contract. Gaeseong Industrial Complex falls victim to tit-for-tat between South and North Korea over the latter’s missile and nuclear tests. Daewoo Engineering & Construction wins project commissioned by Indian state-run enterprise at a time of a special strategic partnership between India and South Korea. Indonesia to undertake major FDI liberalization. Indonesian filmmakers cheer opening of the film industry and cinema sector to foreign investment. Indonesian government plans to provide legal guarantee to PT Kereta Cepat Indonesia China (KCIC) for Indonesia’s high-speed rail project. Thailand’s Board of Investment (BOI) touts the successes of its new investment promotion policy and cluster-promotion scheme. Thailand’s Commerce Ministry aims to bolster the overseas investment capabilities of Thai small- and medium-enterprises. Malaysia sees greater Chinese inward FDI in the future. European Chamber of Commerce expresses its hopes for legal and policy changes during the next Filipino presidency.