European Union

MNCs in the News-2021 March

China Ministry of Commerce spokesperson says China’s new foreign investment security review will not impose unnecessary burden on normal foreign businesses. China’s National People’s Congress Standing Committee Chairman says China will press forward on efforts to combat the extraterritorial application of foreign sanctions. China Banking and Insurance Regulatory Commission gives foreign investors the right to acquire a 51+ percent stake in Chinese insurance companies. China’s economic sanctions against members of European Parliament threaten to disrupt the ratification process of the EU-China Comprehensive Agreement on Investment (CAI). Sweden’s H&M faces backlash because of its stance of working with factories in or products from Xinjiang. Chinese executives in state-owned enterprises in Myanmar say turmoil in the country has not affected Belt and Road Initiative projects. Brexit has adversely affected Japanese foreign direct investment (FDI) in the United Kingdom. The head of SBI Holdings says he will move the firm’s brokerage out of Hong Kong due to the evolving political situation. Line takes steps to limit the access of Chinese affiliates and contractors to Japanese data and shift data from Korea to Japan. Japan’s Fast Retailing suffers disruptions due to fires set at two of its Myanmar suppliers in wake of military coup. Korea advances industrial cluster scheme to increase its local production capabilities in the wake of tensions with Japan and Covid-19 related disruptions. In response to complaints, Google Korea will lower in-app purchase commission for smaller app developers. South Korean companies partnering with Chinese internet platform and fintech firms worry that Beijing’s increasing regulation of the latter may adversely affect their joint ventures. The governor of Georgia asks US President Biden to overturn a United States International Trade Commission ruling that threatens a SK Innovation factory in Georgia.

MNCs in the News-2021 January

China receives the largest amount of inward foreign direct investment (FDI) in 2020. China’s 2020 revised catalog of encouraged FDI takes effect increasing the number of encouraged sectors. China issues rules to counteract foreign extraterritorial sanctions affecting its nationals and companies. Renewable energy investments dominate China’s Belt and Road Initiative (BRI) energy infrastructure investments in 2020, though coal remains prominent. India makes ban on dozens of Chinese mobile phone apps permanent due to national security and data privacy concerns. China asks India to clarify its permanent ban against Chinese mobile apps. Japan creates English-language, one stop shop to help foreign financial firms set up operations in Japan. United States (US) sanctions against Huawei and limits on Huawei’s involvement in foreign telecommunications infrastructure projects led Japan’s Sumitomo to turn elsewhere for business. Brexit deal between United Kingdom (UK) and European Union (EU) will keep Nissan producing electric vehicles in the UK. Japan unconvinced Korean President Moon Jae-In’s labeling of a 2018 Supreme Court decision on corporate assets as “undesirable” will solve anything. The head of GM Korea emphasizes labor issues as one of the factors that reduce South Korea’s appeal as a destination for FDI. SK Innovation to invest $895 million into a battery plant in Georgia, a move some feel is about winning a case before the US International Trade Commission. Daewoo Engineering & Construction wins major port facility contracting deal in Iraq. Korea Hydro & Nuclear Power gets contract for major dams in Pakistan.

MNCs in the News-2020 December

China’s National Development and Reform Commission (NDRC) and Ministry of Commerce (MOFCOM) release revised 2020 catalog of encouraged industries for foreign direct investment (FDI). China’s NDRC issues rules relating to FDI national security reviews. China’s Standing Committee of National People’s Congress considering amendment to criminal law that would increase prison terms for intellectual property rights (IPR) crimes. Chinese outward FDI (OFDI) in Latin America in 2020 a bright spot versus Chinese OFDI (COFDI) in other regions like Europe. China’s Ministry of Foreign Affairs stresses at news briefing that FDI in Belt and Road Initiative (BRI) and CPEC has not declined with many projects showing good results despite Covid-19. United States (US) Congress to provide billions of dollars to fund removal of ZTE and Huawei equipment from US telecommunication carriers’ systems. Japan not succeeding in attracting foreign financial firms due to tax, red tape, language barriers, and other factors. Japan 5G players gain potential new openings due to global crackdown on Chinese companies such as Huawei and ZTE. United Kingdom (UK) and European Union (EU) post-Brexit deal may not prevent Japanese carmakers from leaving the UK. Japanese group to supply $1.8 billion for coal-fired power plant in Vietnam despite complaints about the environmental impact of the plant. Korea Fair Trade Commission (KFTC) will administer a survey to Google Play Store users to accelerate its review of Google’s plan to increase application transactions to 30 percent. Hyundai Heavy Industries Holdings receives Chinese government approval for its $1.8 billion acquisition of Daewoo Shipbuilding and Marine Engineering. Korea electric vehicle (EV) battery makers move to diversify away from China, turning to other countries and local firms for raw materials and components. LG Group has signed a major investment deal with Indonesia that would facilitate its access to EV battery raw materials and product.

MNCs in the News-2020 November

Foreign direct investment (FDI) into China continues to surge despite Covid-19 and other challenges. China’s Ministry of Commerce says China will take further measures to liberalize ownership restrictions for foreign firms in the service sector. Shanghai shows strength in attracting inward FDI (IFDI) and adds to its regional headquarters and research and development center totals. India moves to ban an additional 43 Chinese phone apps including Aliexpress due to concerns about consumer privacy and national security. China states it will continue to support the construction of the China-Pakistan Economic Corridor (CPEC). Malaysian state government of Melaka terminates $10.5 billion Melaka Gateway project. Nissan moves to sell only electric vehicle (EV) or hybrid cars in China to meet Beijing’s goal of all new vehicles being eco-friendly. The Regional Comprehensive Economic Partnership (RCEP) is expected to have notable impacts on Japanese FDI as well as supply chains given its provisions relating to tariffs, rules of origins, and intellectual property. Brexit may lead the European Union (EU) to slap tariffs and other requirements on EVs which have significant adverse effects on Japanese EV production in the United Kingdom. Tokyo Gas and Marubeni will construct a liquefied natural gas fired power plant in Vietnam. Korea’s Fair Trade Commission reportedly has come to the conclusion that Google abused its market position to prevent modified Android operating systems. The labor union at IKEA Korea strikes for similar wage treatment to workers at IKEA workers elsewhere. Some Korean steelmakers return back home due to government subsidy program. Korean consortium wins engineering, construction, and operations contract for $1 billion bridge project in Bangladesh.

MNCs in the News-2020 July

Chinese President Xi Jining courts foreign direct investment (FDI) in encouraging letter to the Global CEO Council. China plans to impose sanctions on United States (US) company Lockheed Martin because of the latter’s weapons sales to Taiwan. China’s new, strict cybersecurity laws and regulations have driven Morgan Stanley, a US investment banking firm, to block its interns in China from remotely accessing its virtual network. The recent border clash with China has increased the pressure on New Delhi to reduce the country’s dependence on Chinese solar goods. Various special interest groups have called for the US to sanction China’s CRRC after the US Pentagon labeled it as backed by the Chinese military, saying it represents a security threat. Despite calls for a boycott in the wake of India’s border clash with China, many are skeptical Chinese smartphones can be displaced from the India market. Japanese and British trade negotiators agree they will not require encryption keys or the localization of data. Japan’s Mizuho Financial Group faces growing shareholder pressure to stop financing coal projects. Japan helps Japanese companies move to Vietnam and also helps them shift production lines to Japan as well as various Southeast Asian countries. Myanmar gives three Japanese firms permission to build a mega-liquified natural gas power plant. Korea to spend billions to promote an innovation-based economy. European Union to restart review of the merger of Daewoo Shipbuilding & Marine Engineering and Hyundai Heavy Industries Holdings. Incheon Port Authority joins the United Nations Global Compact. The backlash against Huawei creates some openings for Samsung, though it is unclear if the Korean firm can exploit them.

MNCs in the News-2020-03-13

China’s State Council identifies measures to encourage greater foreign direct investment (FDI) into China. Shanghai continues to attract inward FDI and seeks to reach new heights in 2020. China’s TikTok to establish center in United States (US) to assuage worries that user data is being transmitted back to China. US Treasury Secretary Steven Mnuchin tells US Congressional committee that the US is working with the International Monetary Fund and World Bank to ensure their funds are not used to repay Belt and Road Initiative debts. Japan will not allow investors filing applications under its new FDI review system to submit notice online or in English. Japanese Ministry of Finance data shows Japan’s overseas investment earnings rose steadily in January 2019, offsetting deficits in other areas. Hyundai Heavy Industries’ acquisition of Daewoo Shipbuilding & Marine Engineering encountered another obstacle with the European Commission delaying its decision on the merger until the summer. Korea’s Samsung facing hindrances to its efforts to boost production at some of its Vietnam factories due to Vietnam’s restrictions on Korean travelers resulting from the coronavirus.

MNCs in the News-2020-02-28

American Chamber of Commerce in China survey shows foreign businesses want tax breaks, clearer and more consistent policies, and greater transparency to help their recovery from the coronavirus epidemic. Survey of European businesses in China reflects, among other things, dissatisfaction with “unpredictable rules, highly restrictive quarantine demands and extensive pre-conditions to restart operations.” Huawei plans to build its first European Union (EU) manufacturing plant in France to address security and other concerns. United States (US) Transportation Security Agency requests its employees to cease using China’s TikTok app to create public content and promotional materials. Tokyo may revise its Foreign Exchange and Foreign Trade Act to lighten advance notice requirements for certain entities such as university endowments and corporate pension funds. Nissan warns that the failure to strike a free trade agreement with the EU post-Brexit may affect the future of its factory in the United Kingdom. Seoul to modify laws and boost incentives to lure more large South Korean companies to come home.

Dr. Jean-Marc F. Blanchard's picture

De virus, Decoupling, De-globalization, Downsizing, and FDI in China

China’s coronavirus epidemic has had profound economic effects including dramatically reducing travel within and outside China, severely suppressing business activity in the education, entertainment, food & beverage, and leisure and recreation industries, among others, and disrupting or freezing manufacturing and the delivery of production i

MNCs in the News-2020-02-07

China’s Ministry of Commerce pushes Chinese Chambers of Commerce to provide force majeure certificates to Chinese firms struggling to meet their contractual obligations due to disruptions caused by the coronavirus crisis. Wuhan Institute of Virology move to apply for a patent to use United States (US) firm Gilead’s remdesivir to treat pneumonia like symptoms raises intellectual property issues. Huawei’s Chief Representative to European Union (EU) institutions says the firm will build 5G manufacturing bases in Europe. US Attorney General Bill Barr advocates US and its allies taking controlling stakes in Nokia, Ericsson, or both to fend off Huawei 5G challenge. Japan’s Ministry of Defense reveals two new Japanese defense-related companies that suffered cyberattacks, without stating if classified information was leaked. Japanese company plans to cope with Brexit subject to change depending upon trade negotiations between the United Kingdom (UK) and the EU. Japan files petition with the World Trade Organization to challenge planned merger between Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering. Panama re-awards Metro Line 3 to Korean consortium, rejecting challenges from Chinese firms and a consortium with a Chinese company.

MNCs in the News-2019-11-15

According to a German Chamber of Commerce survey, a large percentage of German companies plan on boosting their foreign direct investment (FDI) in China over the next two years. The United States (US)–China trade war and rising costs in China unlikely to led to exodus of FDI outside China because no country possesses the entire package of advantages China does. China MOFCOM reports that China’s non-financial outward FDI (OFDI) grew almost 6 percent over the first 10 months of 2019 year-over-year. US National Defense Authorization Act language may terminate the availability of federal funds to buy electric buses made by BYD at its California factory. South Korean airlines are closing offices in Japan as well as suspending or reducing flights to Japan because of falling tourism resulting from Korea-Japan tensions. Japanese Ambassador to Bangladesh calls on the latter to provide economic incentives and improve policy stability. LG Chem asks the US International Trade Commission to rule quickly on its trade secrets theft case against SK Innovation. Hyundai Heavy Industries submits formal request to European Union (EU) asking for approval of its planned merger Daewoo Shipbuilding & Marine Engineering

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