Xi Jinping

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-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-2019-07-05

Chinese Premier Li Keqiang announces China plans to create a better environment for foreign direct investment (FDI) in China. China’s financial opening leads various foreign investors to move to take control of their China joint ventures (JVs). Chinese outbound mergers and acquisitions (M&A) volume for the first six months of 2019 is the lowest since 2013. During a visit to China, Turkey’s President works to attract Chinese FDI and take advantage of the Belt and Road Initiative (BRI). With the activities of information technology giants gaining increased Japanese government scrutiny, the Japan unit of Facebook joins Keidanren. Japan’s export curbs on semiconductor materials bound for South Korea due to their dispute over forced labor compensation could pressure Samsung and the broader Korean economy. Japanese export controls on high-tech materials and chemicals used in South Korean semiconductor and smartphone manufacturing will stress Korean companies already feeling market and trade pressures. After a gathering between United States (US) President Donald Trump and the heads of major South Korean business groups, some Korean firms stated they would boost their US investments.

MNCs in the News-2019-06-28

President Donald Trump’s tough stance on intellectual property rights (IPR) violations seems to be driving China to treat foreign IPR more respectfully. At the Osaka G20 Summit, Chinese President Xi Jinping announces several measures China will undertake to open its market further to foreign direct investment (FDI) and improve IPR protection. This past week witnessed the creation of the Belt and Road Economic Information Partnership (BREIP). Two major BRI projects in Africa end. At the Osaka G20 summit, participating countries embrace Japan’s international principles for quality infrastructure. Japan tells two leading candidates for the British Prime Ministership it does not want a “no deal Brexit.” As part of its downstream growth and diversification strategy, Saudi Aramco and its affiliates have signed a dozen accords with South Korean companies covering sectors areas like shipbuilding, engine manufacturing, and petrochemicals. A consortium involving Korea Hydro & Nuclear Power (KNHP) and KEPCO Plant Service & Engineering (KPS) signs a five-year maintenance service deal for the Barakah nuclear power plant, but fails to garner responsibilities for maintenance services, nuclear scientists, and engineers.

MNCs in the News-2019-05-10

The ongoing China-United States (US) trade war coupled with other economic and political factors drives more firms to consider other locations besides China. China moves to take more steps to protect intellectual property (IP), partly to assuage the concerns of foreign investors. China poured record amounts of investment into US start-ups last year despite Sino-American tensions, but there are dark clouds on the horizon especially in regard to investment screening. Security and other concerns lead US Federal Communications Commission hangs up on China Mobile’s effort to operate and offer service in the US. Not a single European country has joined Washington’s call to boycott China’s Huawei. Japanese banks move to improve their anti-money laundering and terrorist financing practices so as to increase chances of good Financial Action Task Force review. Japanese foreign direct investment in the US surges for political and economic reasons, with some “red states” seemingly benefiting from the former. Seoul police investigate if BMW Korea’s Chairman covered up automobile defects. Lotte Chemical launches USD $3.1 billion ethylene cracker complex in Louisiana with strong political support from Korea and the US.

Dr. Jean-Marc F. Blanchard's picture

Belt and Road Forum, II, part I-Cleaning Up the House

At the recent Belt and Road Forum, Chinese President Xi Jinping stressed China would adopt a zero-tolerance policy towards corruption regarding its Belt and Road Initiative (BRI).

MNCs in the News-2019-04-26

United States (US) Trade Representative (USTR) criticizes China’s intellectual property (IP) protections and calls for stronger IP safeguards. China pledges the journey along its Belt and Road (BRI) will only get better. Survey shows new European Union (EU) foreign direct investment (FDI) screening laws make Chinese companies feel the EU is discriminating against them. United Kingdom (UK) reportedly dials into China’s Huawei participating in its 5G network activities. Eager to keep Italy from moving too close to Beijing, Japan calls for deeper economic (and military) cooperation during top leader summit. Korea charged up about lack of level playing field relating to electric vehicle subsidies. Korean petrochemical firms will be hit by the upcoming end to the US policy of granting waivers to countries importing Iranian crude oil.

MNCs in the News-2019-04-05

Chinese government shines light on subnational units that are making it difficult for foreign direct investment (FDI). China lubricating way for foreign energy giants to enter its petrochemical sector. Beijing is drafting rules to identify a list of BRI projects officially acknowledged by the Chinese government. China’s expansion in Latin America via the BRI raises US anxieties. British officials and senior labor union members will travel to Japan to press Honda to review its decision to shut down its United Kingdom (UK) Swindon plant. Toshiba experiencing delays in securing approval from the Committee on Foreign Investment in the United States (CFIUS) to sell its liquefied natural gas (LNG) business to a Chinese company. Korea Hydro & Nuclear Power (KHNP) risks bid to become long-term maintenance service provider of the United Arab Emirates (UAE) Emirates Nuclear Energy Corporation’s (ENEC) Barakah Nuclear Energy Plant because of its unilateral decision to replace plant’s workforce. Responding to a Saudi Arabian Cabinet member’s interview reporting “‘advanced’” talks, Hyundai Motor denied plans to build a new manufacturing plant in Saudi Arabia.

Dr. Scott MacDonald's picture

Italy Signs on to the Belt and Road Initiative

In late March 2019, Chinese President Xi Jinping traveled to Rome, where he met with Prime Minister Giuseppe Conte, who signed a memorandum of understanding pursuant to which Italy signed on to China’s Belt and Road Initiative (BRI), making it the first Group-7 country to do so.

MNCs in the News-2019-03-15

China’s National People’s Congress approves new foreign investment law obliging officials to protect commercially confidential information obtained from foreign companies. European Union (EU) releases policy paper in which the EU threatens to tighten rules on Chinese investment in Europe, partly in response to Chinese restrictions on EU investment in China. Top United States (US) general Joseph Dunford expresses concern that Google’s work in China directly benefits Chinese military. In response to increasing global criticism of China’s Belt and Road Initiative (BRI), Beijing calls for American and European firms to join President Xi Jinping’s signature initiative. Toyota Motor now plans to invest $3 billion more than originally planned in the US to avoid increased tariffs under the North American Free Trade Agreement. Nissan Motor Co. Ltd. will cease production of two more models at its Sunderland plant due to uncertainties flowing from Brexit. Lotte Group will leave China after failing to recover from the boycotts caused by Beijing’s diplomatic bickering with Seoul over the latter’s deployment of the Terminal High Altitude Area Defense (THAAD) anti-missile system. Seoul and Tokyo fail to resolve their frictions flowing from the legal dispute over wartime labor compensation, with Tokyo warning of economic retaliation if Seoul goes ahead with the seizures of Japanese company assets.

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