FTZ

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-2019-08-09

To cope with United States (US) tariffs on Chinese goods, several prominent Japanese firms operating in China are planning to relocate some of their manufacturing to other Asian countries. China’s State Council has expanded the Shanghai Free Trade Zone (FTZ), adding an area called Lingang area which is supposed to become a business cluster for international businesses and cross-border financial services. The China-US trade war has driven two large Chinese consumer health care companies to seek to cooperate with/invest in Malaysia’s largest generic drug maker to grow their manufacturing base in Malaysia. China’s Zhong Ji Mining froze operations at its gold mine in Kyrgyzstan after 20 people were hurt in clashes between local protesters and Chinese workers. Tokyo touts that it had approved the export of a sensitive chemical to Korea, the first since it intensified export controls in July. Malaysia’s International Trade and Industry Minister reports Japan’s Daihastu Motor “would provide ‘advanced technological support’” for Malaysia’s third national car company. A Korean National Labor Relations Commission decision to freeze the ongoing arbitration between GM Korea and its labor union means the labor union now has the legal right to strike. Due to Seoul’s decision in 2018 to have all public enterprises sell their overseas assets,” Korea Resources Corp. has been pursuing the sale of its Cobre Panama copper mine, albeit unsuccessfully.

MNCs in the News-2019-06-07

China’s Ministry of Commerce (MOFCOM) reports United States (US) tariffs on Chinese goods have not significantly affected the country’s flows of inward foreign direct investment (FDI). MOFCOM announces China will blacklist “unreliable” foreign businesses which violate market rules, take discriminatory measures hurting Chinese business rights and interests, or threaten China’s national security. China’s plan to build a $1.9 billion light-railway system in Kazakhstan has stalled as China Development Bank cuts off funding due to possible corruption problems. China keeps open non-money-making Vietnam-China Economic and Trade Cooperation Park (VCEP) because of VCEP’s contribution to better image of Chinese FDI. Japanese and other multinational corporations call for more standardized and clearer rules and greater freedom for data transfer and storage. Airbnb experiences revival in Japan after new regulations caused tens of thousands of listers to check-out. Recent arrests of several Samsung Electronics senior executives for an alleged accounting fraud may distract Samsung from taking advantage of the woes of major competitor Huawei. In light of its recent retreat from overseas ventures, Korea National Oil Corp.’s announcement it planned to invest roughly USD $253 million in the UAE in an oil development project has caused controversy.

MNCs in the News-2018-08-17

China’s Ministry of Commerce (MOFCOM) reported that inward foreign direct investment (FDI) over the first seven months of 2018 grew 5.5 percent year-over-year (YOY) with strong growth in inward FDI (IFDI) in high-tech industries. MOFCOM noted that there was major growth in IFDI from countries such as the United Kingdom (UK), South Korea, and Japan over the first seven months of 2018 YOY. Hundreds of Google employees raise concerns internally about the firm’s plans to produce a censored search engine for China. China National Petroleum Corporation (CNPC) takes over Total’s stake in Iran’s South Pars Phase II project as Total must abandon it due to re-imposition of United States (US) sanctions. Japanese regulators investigating Apple over allegations that it unfairly pressured Yahoo Japan to slow the expansion of online games platform. Japan makes economic cooperation with the Indo-Pacific region a diplomatic priority in attempt to counter China’s Belt and Road Initiative. South Korea places ban on over 20,000 BMWs after more than 30 engines caught fire this year due to faulty hardware. South Korean Prime Minister calls for increased cooperation with Qatar especially in infrastructure projects.

MNCs in the News-2018-06-29

China’s National Development and Reform Commission (NDRC) unveils new nationwide negative list which opens about 17 more sectors and reduces various restrictions. China’s Ministry of Commerce (MOFCOM) and NDRC released a revamped negative list for foreign direct investment (FDI) in China’s free trade zones (FTZs) that has some better features than nationwide negative list. United States apparently to go with enhanced Committee on Foreign Investment in the United States (CFIUS) review process rather than establish mechanisms that specifically focused on restraining Chinese FDI. Nissan picks Thailand as first export market for new hybrid cars which may lead to local production if results and investment incentives are attractive. Sumitomo Mitsui Banking Corporation signs memorandum with Thailand’s governmental agency that the latter hopes will boost FDI. Samsung’s managing leaders recently convened to discuss a growing “China problem” as company confronts various political and regulatory problems. Taiwan’s GlobalWafers intends to follow through on USD $450 million Korean production facility amid increased Sino-US trade tensions. Malaysian government optimistic that investors’ confidence will be restored partly due to Prime Minister Mahathir’ effort to court FDI. Survey reveals Japanese companies interested in setting up manufacturing bases in Malaysia and are looking to invest in new sectors.

MNCs in the News-2017-06-23

China’s State Council announces that 27 restrictions relating to foreign direct investment (FDI) in its free-trade zones have been eliminated. China’s non-financial outward FDI (OFDI) plunges by almost 53 percent for the first five months of the year year-over-year (YOY). Chinese legal experts suggest new international legal mechanisms may be needed to deal with disputes involving Chinese OFDI. China’s Huadian, a state-owned enterprises (SOE), and Russia’s TGC-2 announce nearly $600 million joint venture power project has come online. After years of decline because of political tensions Japanese companies now more willing to invest in China. Survey shows Japanese firms willing to increase investment in Thailand especially in Eastern Economic Corridor. Samsung Electronics Co. about to finalize talks on expanding its US production facilities, a move motivated by Donald Trump’s election. Jakarta promises more easing of rules to increase foreign investment. PGN, Indonesia’s National Gas company, plans to make Batam Indonesia a center of natural gas supplies and a “paradise” for energy investors. Malaysia Digital Economy Corp welcomes Japanese ICT firms to use Malaysia as a stepping-stone for entering the Southeast Asian market. Malaysia’s Construction Industry Development Board to participate in bidding process for Indian railway stations’ makeover.

MNCs in the News-2017-04-07

China’s State Council creates seven new free trade zones bringing the total number in the country to 11. China’s State Administration of Foreign Exchange (SAFE) pushes foreign businesses to support its efforts to limit capital outflows from China. Prior to Donald Trump-Xi Jinping meeting, Chinese parliamentarian links the quality of the meeting to Google’s prospects for entering China. European Union regulators approve China National Chemical Corporations (ChemChina)’s massive acquisition of Syngenta while requiring some significant divestitures. Trump administration considers some dramatic steps to keep Westinghouse’s nuclear business out of Chinese hands. Sibanye Gold Ltd.’s proposed investment in Stillwater mining may not be golden because of American concerns over strategic materials access. Iran-Japan Investment Treaty enters into force on April 26 and may spur Japanese energy investment in Iran. Japanese foreign acquisitions hit a new record of almost USD $100 billion in fiscal year 2016, but performance is dubious. South Korea’s installation of the THAAD system continues to affect adversely Sino-Korean economic relations and Korean businesses. The fallout between China and South Korea over THAAD contributes to South Korean car manufacturers reducing production in their Chinese factories. Consortium of Chinese and Indonesian companies signs contract launching the construction phase of the Jakarta-Bandung high-speed train project. Afghan President Ghani encourages Indonesian investors to invest in Afghanistan and stresses the security of foreign investors as a top government priority. Tier-one American aerospace manufacturer may invest in Malaysia stimulating business for small and medium enterprises and creating high-income jobs. India and Malaysia sign investment deals with a value of USD $36 billion. Belgium plans to ramp up green energy investment in Vietnam.

MNCs in the News-2016-09-02

China’s National People’s Congress Standing Committee adopts amendments that allow for the permanent suspension of four foreign investment related laws in the Fujian, Guangdong, Shanghai, and Tianjin Free Trade Zones (FTZ). China has decided to allow for the creation of six new provincial FTZs as well as one municipal level FTZ, with each place expected to play to its features and comparative advantages. The European Chamber of Commerce in China asserts China’s market barriers are politically unsustainable. China’s Ministry of Commerce confirms to reporters that it is investigating the proposed Didi-Uber merger. British Prime Minister Theresa May confirms she would have her National Security Council examine the potential security implications of China’s participation in the massive Hinkley Point C nuclear power plant project. Japan pledges USD $30 billion investment in Africa at the 6th Tokyo International Conference on African Development. Japanese trading firms find electrifying power project opportunities in Africa. Korean free economic zones are not achieving the anticipated results. Indonesian state-owned enterprises seek funding from multiple sources to fund the country’s massive infrastructure plans. Vietnam and Cuba aim to boost bilateral investment flows.

MNCs in the News-2016-01-15

China’s Ministry of Commerce (MOFCOM) announces that China’s inward foreign direct investment (FDI) hit $126.27 billion in 2015. Apple works to promote zero waste and solar energy programs at its China suppliers. In 2015, Apple was the largest foreign service sector tax payer in Shanghai while Shanghai Volkswagen was the largest foreign industrial sector tax payer. GAC Group becomes strategic investor in Uber. China’s outward M&A in 2015 hits record. Beijing Kunlun buys stake in gay dating ap Grindr. Japanese firms win construction deals in Myanmar’s Thilawa special economic zone. Woori Bank becomes first Korean bank to arrange Sharia-law compliant financial transaction with an Islamic bank. Indonesia and Russia pursue improvements in their investment, trade, and other forms of economic cooperation. Indonesia National Human Rights Commission calls for Japan to be attentive to possible human rights violations regarding a Japanese supported thermal power plant project. Foreign investment into Thailand in 2015 drops dramatically. Thai Industrial Association head frets that Transpacific Partnership will led to investment diversion as well as intensifying competitive pressure for Thai goods. THAI breaks tradition on bringing foreigners into managerial ranks. State-owned Vietnam Airlines welcomes investment from Japan’s ANA Holdings. Ho Chi Minh City orders Uber to pay taxes due immediately. Pressures for Vietnamese SOE reform through foreign partnerships increase, but the process proves challenging

MNCs in the News-2015-04-24

China’s Finance Minister Lou Jiwei raises concern about US Bilateral Investment Treaty proposals. Wall Street Journal analysis reveals that many Variable Interest Entities may be at risk depending upon how Chinese treats such structures. IBM cooperation with Chinese firm and China raises concerns about the business and political implications. Huawei CEO Eric Xu raises concerns about the potential fallout of China’s new stance toward foreign information technology. The American Chamber of Commerce’s White Paper calls for numerous improvements in the general and sectoral policy environment facing foreign businesses in China. China’s Finance Minister expresses concerns about US Bilateral Investment Treaty demands. China moves to make its negative list more positive in four key free trade zones (FTZs). Jiangsu Province’s Provincial Price Bureau makes Daimler Mercedes-Benz pay a price for price fixing. Visa and MasterCard appear ready to cash in on China’s bank-card clearing market after State Council opens the market in response to a World Trade Organization (WTO) ruling. Korea moves to enrich up its Food cluster Foodpolis. Korean president Park Geun-hye visit to Latin America results in boost to Korean investment and trade. Indonesia will court Chinese investors with special “information desk” in Beijing.