Europe

The Cyberspace Administration of China will begin hardware and software checks starting June 1. Foxconn Technology Group Chairman indicates it is looking at investment prospects in the United States (US) following meetings with US officials. Japanese Prime Minister Shinzo Abe asks British Prime Minister Theresa May to ensure a smooth transition for Japanese business following Brexit to limit problems for Japanese investors. Japan launches various initiatives to ease the way for greater foreign investment. Russia and Japan agree on key terms and conditions for launching a joint investment fund to boost their investment cooperation. Chinese economic retaliation due to South Korea’s deployment of the US THAAD system has potentially cost the Korean economy USD $7.6 billion. E-Mart to close China outlets by the end of this year partly due to anti-Korean sentiments flowing from Seoul’s deployment of THAAD. Japan’s bid for high-speed rail connecting Kuala Lumpur with Singapore to include financing, talent development, and collaboration with local companies. Foreign technology companies increase Singaporean investment following strong demand and government incentives. Vietnam licensed major gas pipeline project which represents its second billion-dollar foreign investment project in 2017 and an increase of total FDI. Vietnamese Deputy Prime Minister encourages Sumitomo Mitsui to increase investment in the country’s infrastructure.

American business community becomes more favorable towards “reciprocity” policy towards China. Hejun Vanguard Group files complaint against sale of McDonald’s China and Hong Kong assets. Chinese firms’ pursuit of investment in critical sectors leads Germany, France, and Italy to ask European Union (EU) to give it more powers to investigate and block investments. The United States (US) Federal Trade Commission asks Syngenta for more information regarding its proposed acquisition by China’s ChemChina. In the face of potential restrictions on Chinese firm investments in non-core businesses, Dalian Wanda eyes European bank deals. Japanese companies face investigation by South Korea’s transport ministry which has begun to investigate more firms in the wake of the Volkswagen emission manipulation scandal. Toshiba will remove itself from work on the UK’s new Moorside nuclear plant. South Korea’s Korea Electric Power Corp. (KEPCO) has started its first wind power plant in Jordan. Korean outward foreign direct investment (FDI) grows significantly in 2016 with a large increase in money flowing to the US. Indonesian loosening of ban on raw mineral ore exports has many implications. Indonesian regional elections have big implications for Indonesia’s inward FDI (FDI)

At opening of the “New Developments for Japanese and Chinese Firms” conference, Dr. Jean-Marc F. Blanchard, Executive Director of the Wong MNC Center, delivered a keynote address entitled “Patterns in Chinese Outward FDI and its Implications for Japanese Firms.” Dr. Blanchard started by providing background information on Chinese outward foreign direct investment (OFDI) from the 1970s through the 1990s, covering its volumes, sectoral destinations, geographic patterns, and drivers at the macro- and micro (firm) levels.

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.

China’s Ministry of Commerce (MOFCOM) reports that foreign direct investment flows into China topped USD $22.5 billion in the first two months of 2016. Bristol-Myers Squibb moves to deal with fallout of US Securities and Exchange Commission (SEC) Foreign Corrupt Practices Act settlement relating to its China joint venture. Chrysler to recall nearly 21,000 vehicles in China that have an oil pipe defect. Chinese outward foreign direct investment (COFDI) soars YOY with smaller and private enterprises becoming more important proportionally. Statistics for 2015 show strength of COFDI in Europe. China sees room for more COFDI in Russian agriculture as well as agricultural cooperation. Some believe COFDI in the US has the potential to influence voting patterns in some localities. Chicago Transit Authority awards CSR Sifang America a USD $1.3 billion railcar supply order. Mitsubishi partners with Korean firm on government awarded coal-fired power plant project in Vietnam. Foreign businesses in Korea voice concern about the discretionary legal and regulatory environment and call for greater stability. Korea Trade-Investment Promotion Agency has concluded a Memorandum of Understanding with Italy’s SIMEST that will facilitate more Italian investment in Korea. Korea and Egypt expand their bilateral cooperation increase infrastructure and cooperation opportunities for Korean firms in Egypt. The liberalization of Indonesia’s cinema sector draws increases foreign investor interest in cinema screen construction in the country. The Thai Business Development Department (TBDD) and Franchise License Association (FLA) will cooperate to assist franchise business operators conduct business in ASEAN countries, China, and Japan. State Railway of Thailand (SRT) governor welcomes foreign construction companies to participate in government investment projects provided they find a Thai partner and obey Thai rules and regulations.