MOFCOM

MNCs in the News-2019-07-12

Inward foreign direct investment (FDI) flows into China continue to grow, especially in the high-tech sector. Chinese Ministry of Commerce (MOFCOM) official states that Inward FDI (IFDI) is not leaving China en masse and that China will “protect the legitimate rights and interests of foreign investors.” Chinese outward FDI (OFDI) to Europe and North America over the first six months of 2019 shows a noticeable decrease over the same period the prior year. Despite a spying incident and Poland’s President saying he was opposed to Chinese OFDI (COFDI) in strategic infrastructure, Poland’s Foreign Minister told visiting Chinese State Councilor Wang Yi Poland is open to COFDI. Korea reacts strongly to Japanese media report in which a senior member of Japan’s Liberal Democratic party charged dual-use chemicals exported to South Korea ended up in the North. Japan is surprised at Seoul’s strong response to it instituting tighter controls on the export of certain chemicals to South Korea and Seoul making the issue a World Trade Organization (WTO) issue. Japan moving towards a formal WTO case regarding Seoul’s provision of subsidies to South Korean shipbuilders. Hyundai Engineering and Construction signs a $2.7 billion contract with Saudi Aramco for two projects relating to a massive oil and gas refining complex.

MNCs in the News-2019-06-14

People’s Bank of China willing to back “pilot program based in Shanghai to remove the foreign ownership limit in firms providing securities and fund management services.” According to China Ministry of Commerce report, the growth rate of United States (US) foreign direct investment in China seems to be slowing. Chinese firms have been become increasingly active in hydropower sector overseas. Shanghai’s new technology board seen offering opportunities for Chinese firms encountering limits in dealing with the US or US companies. Tokyo Electron not to supply “Chinese clients blacklisted by Washington.” Japan’s Inpex ready to agree in principle with Indonesia to build a USD $18.4 billion liquefied natural gas plant. Renault Samsung Motors union cancels plans for an all-out strike due to workers going on strike against union management. LG Chem forms 50-50 joint venture with China’s Geely to position itself for new market opportunities after Chinese government electric vehicle battery subsidies cease.

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-2019-05-17

According to China’s Ministry of Commerce (MOFCOM), the growth rate of inward foreign direct investment (FDI) from the United States (US) into China over the first four months of 2019 dropped noticeably year-over-year (YOY). Beijing moves to tighten controls over technologies such as cloud computing, big data, and industrial security systems to bolster national information security. Expansion of American tariffs on Chinese goods drives more companies out of China. US Commerce Department’s proposed ban on hardware and service exports to Huawei could severely affect the firm and its American suppliers. Japanese companies working to use more foreign directors to enhance corporate governance and benefit from new thinking. Japan’s Toyota expresses dismay at US President Trump’s statement that “the US needs to defend itself against foreign cars and components.” FDI flows into South Korea for the first quarter of 2019 plummet YOY with some attributing it to the end of tax breaks. Hoping to position itself for the time when subsides for new energy vehicles (NEV) end, South Korea’s SK Innovation plans to open a second battery factory in China.

MNCs in the News-2019-03-22

According to China’s Ministry of Commerce (MOFCOM), inward foreign direct investment (FDI) for the first two months of 2019 grew 5.5 percent year-over-year (YOY). China’s State Administration of Foreign Exchange (SAFE) makes it easier for foreign companies to manage their foreign exchange. Italy may open four ports to Chinese FDI as part of its participation in the Belt and Road Initiative (BRI). Germany to establish state-owned fund to protect key companies from takeovers by foreign companies, especially Chinese ones. Koreans forced to work for Japanese corporations without compensation during World War II are rushing to file lawsuits before the statute of limitations runs out. Toyota announces it will build a new hybrid car in Britain for its Japanese peer Suzuki despite Brexit uncertainties. South Korea’s Gyeonggi Province considers bill requiring schools to put “‘war criminal tags’” on products manufactured by Japanese firms. South Korea’s S-Oil and Hyundai Oilbank will pay USD $127 million in fines to the United States (US) Justice Department for fixing fuel prices at US military bases in Korea.

MNCs in the News-2019-03-01

China’s Ministry of Commerce (MOFCOM) announces China will keep improving the legal and market environments for foreign investors. United States (US) President Donald Trump recently announced the US has made substantial progress in talks with Beijing on improving its IP protection. American Chamber of Commerce in China survey indicates some positive views about China’s progress in protecting intellectual property rights (IPR), though concerns about profitability and the future are rising. Following the European Parliament’s approval of a mechanism to control foreign investment in strategic sectors, Chinese official calls upon the EU to adopt an open and inclusive attitude towards foreign companies. Per JETRO survey, Japanese parts suppliers in China hit worse by US-China trade frictions than other Japanese firms there. British business secretary will travel to Japan to ask Honda Motors to reconsider its recent decision to shut down Swindon car plant. Abu Dhabi National Oil Company awards South Korea Engineering and Construction contract for USD $1.2 billion underground oil project. South Korea’s Financial Supervisory Service will tighten monitoring of foreign firms’ unfair trading practices.

MNCs in the News-2019-02-22

Shanghai municipal government investment measures appear to have enabled the city to maintain strong foreign investment growth despite a challenging environment. BIStel says it will expand its investment in China despite the China-United States trade war because China is its biggest target market. Saudi Arabia’s Aramco signs Memorandum of Understanding (MoU) for investment in major refining and petrochemical investments in Liaoning that may substantially boost energy exports to China. According to China’s Ministry of Commerce (MOFCOM), Chinese non-financial outbound FDI in 47 countries participating in the Belt and Road Initiative (BRI) increased 8.1 percent year-over-year. Despite uncertainties over Brexit, Chinese companies remain interested in investing in the United Kingdom. Tokyo considers backing Russia’s Novatek’s Arctic liquefied natural gas project in the hopes of bolstering Japan’s negotiating position in territorial talks with Moscow. An increasing number of Japanese automakers are leaving or reconsidering their position in the UK as Brexit fast approaches. Seoul expects the second US-North Korea summit to facilitate inter-Korean investment projects including a Korea peninsula rail link. India and South Korea agreed to enhance cooperation in diverse economic areas, including many pertaining to investment.

MNCs in the News-2019-02-15

Per China’s Ministry of Commerce (MOFCOM), inward foreign direct investment (FDI) flows in January increased 4.8 percent versus the prior period in 2018. Despite United States (US)-China trade dispute, in January, China’s IFDI from the US increased 126.8 percent compared to the same period in 2018. European Parliament revamps European Union (EU) investment screening mechanism to give European Commission power to review deals, though ultimate decision making remains with EU states. U.S.-China Economic and Security Review Commission highlights personal and national security risks from Chinese investors taking stakes in American biotech companies. Israel will create an interagency body to oversee sensitive commercial deals partly to ensure foreign investments, above all by China, do not damage its ties with the US. Japanese and South Korean businesses fret about the impact of heightened tensions between the two governments relating to history and recent naval encounters. Per reports, following Malaysian Prime Minister Dr. Mahathir Mohamed’s visit to Tokyo last year, major Japanese companies invested hundreds of millions in Malaysia. Russia will take more steps to support Koreans firms doing business in Russia’s Far East. South Korea and Austria move to expand cooperation as Austria seeks Korean help to become a 5G leader in Europe.

MNCs in the News-2019-01-18

China Ministry of Commerce report shows anemic increase in inward foreign direct investment (FDI) flows in 2018 year-over-year (YOY), though strong growth in manufacturing inward FDI (IFDI) in 2018 YOY. Foreign automaker optimism about the China market increases due to the calming of the United States (US)-China trade war. JPMorgan Chase & Co.’s 2019 global M&A outlook report predicts Chinese companies will continue to look for overseas mergers and acquisitions (M&As), partly because of readily-available capital. Paitron Services and the China Overseas Development Association report Chinese outward FDI (OFDI) now riskier because of growing tensions with the US and threats posed by terrorist groups. During a recent visit to Israel, US Deputy Secretary warned Jerusalem bilateral intelligence sharing could be at risk if the latter did not implement tougher screening of Chinese investments. Hitachi Ltd. board decision to suspend plans to build two nuclear reactors in the United Kingdom (UK) flow from financial issues not the political turmoil flowing from Brexit. South Korea will pursue closer ties with United Arab Emirates in the energy sector. Seoul High Court upholds ruling ordering Japanese machinery maker Nachi-Fujikoshi Corp. to pay compensation to Korean forced laborers.

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.

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