Chinese companies Cross index BRIC countries bottom

Liu Qiong ZTE made a difficult decision to build its base station into Japan, the world's most demanding and hardest-breaking high-end communications market.　　Earlier this month, ZTE's idea was realized, and it would join hands with Hitachi to deploy WiMAX Pico commercial base stations nationwide for the Japanese operator UQC, with a construction scale of more than 1200 base stations and a gradual commercial presence throughout Japan. It is such a difficult decision to allow Chinese enterprises to increase the amount of overseas investment trend.　　Globally, a new group of investors--including China, India and other emerging market multinationals--is on the rise.　　At the end of 2008, the list of 18 Chinese multinationals owned nearly 134 billion dollars of overseas assets, equivalent to 90% of China's total outward investment, according to the "2010 China Multinationals Rankings", published jointly by the School of Management at Fudan University and the Center for Sustainable Investment at Columbia College in the United States. Quality of overseas assets to be improved in fact, OFDI from mainland China has been developing since its accession to the WTO in 2001 and the government's "going global" policy. Over the past 1992-2003 years, there has been little change in outward FDI from the mainland, with a relatively rapid growth since 2004, from 5.5 billion dollars to 2008 years of 52 billion dollars and 48 billion dollars in 2009,　　The second largest foreign investment flow in emerging markets in the 2009 years has been China's mainland after Hong Kong. China's outward FDI continued to grow in 2010. In the first three quarters, Chinese multinationals invested 36.3 billion dollars in 118 countries and regions (up 10% from the same period in the previous year). By the end of 2009, nearly 12,000 Chinese investment entities had established 13,000 overseas companies, covering 177 countries and regions.　　China has become one of the most important exporters of outward FDI. It is noteworthy that, although Chinese companies have grown rapidly in overseas assets in recent years, the change in the total assets of overseas assets is not obvious. "It also shows that China's multinational companies attach equal importance to domestic and foreign markets."　　"said Shitiuchi, vice dean of Management College of Fudan University and Director of International Business Management Research Center." At the same time, overseas sales growth is slightly slower than overseas asset growth. "This is probably due to two reasons."　　Professor Xue said that some of the new overseas assets were invested in the energy sector, which did not translate quickly into income; On the other hand, the global recession has reduced demand in overseas markets and some companies have been frustrated by Cross-border acquisitions. In addition, due to China's accession to the WTO and the addition of important strategic resources, many foreign companies pay more attention to this fast-growing market, which leads to more competitive pressure on multinational companies in China.　　To keep them competitive in the domestic market, some Chinese multinationals have focused more on domestic development in recent years. Cross-border mergers and acquisitions have been active in overseas investment by Chinese energy companies. Not long ago, Sinopec bought American Western Oil companyThe assets, CNOOC also announced the acquisition of BP's Pan American energy company in Argentina. In fact, Chinese multinationals have been actively involved in Cross-border acquisitions over the past few years, with the main aim of acquiring overseas core assets.　　Among them, the foreign mergers and acquisitions which mainly take the energy resources as the object of acquisition accounted for 56% of the total overseas acquisitions. Chinese companies have become the main players in overseas mining resources acquisitions, according to the report.　　China's mergers and acquisitions in the mining and metals industry in 2009 amounted to $16.1 billion trillion, accounting for 27% of global transactions. "Companies in the natural resources sector are committed to increasing their strategic reserves, while other types of companies acquire technology, research and development capabilities and overseas market share through cross-border acquisitions." Xue Analysis said.　　Better management of China's large amount of foreign exchange reserves has become an increasingly important factor in the development of overseas investment. Affected by the global financial crisis, China's Cross-border purchases from 2008 to 38 billion dollars to 2009 years of 21 billion dollars.　　Still, the volume of overseas purchases remains larger than in other emerging market countries. For the motives of China's foreign direct investment, Xue said, there are three main aspects. The first is to find the market.　　Many Chinese companies take advantage of China's unique strengths, such as abundant and inexpensive labor and company-specific advantages, such as the experience of manufacturing and selling standardised products to gain financial returns from overseas markets. Second, seek natural resources.　　To meet the demand for China's fast-growing economy and mineral oil, Chinese multinationals have accelerated their internationalization and invested more in natural resources abroad. And the search for creative assets. To complement the long-term competitive disadvantage of Chinese multinationals, especially in China's manufacturing multinationals, seeking creative assets overseas.　　Some companies have established research and development centers in developed countries to keep up with the latest technological trends, and some companies have formed a knowledge alliance with foreign industry giants, and some have acquired core technology and managed assets through Cross-border acquisitions.　　Xue learn that, in general, Western multinationals are "swagger", using their own technology, management advantages in the development of foreign transnational business, while China's multinational companies in the "short", the development of foreign transnational business is a large part of the hope to acquire technology, management and so on. On the other hand, it should be noted that "Chinese enterprises are weak in the integration of international assets and enterprises ' international resources, the ability of cross-cultural management is weak, how the merged enterprises integrate into the enterprise, and complete the management goal of the enterprise is a big problem."　　Xue said. What is the level of development of multinational companies in China compared to those in developed countries such as Wal-Mart and GE?　　The study shows that if judged by cross-country indices, China's 18 companies show that their average cross-country index (TNI) is still at a lower level. A cross-country index is an average of three ratios of total assets, overseas sales to total sales and overseas employees to the overall number of employees, based on the company's overseas assets. Research shows that 18 of companiesCross-border indices vary widely, from 3% to 77%, while the average cross-country index is 14.8%.　　The average transnational index of Chinese multinationals is well below the averages of 100 non-financial multinationals in the developing economies and regions of UNCTAD statistics, and far below those in emerging markets such as Russia (54%), India (41%) and Brazil (40%). Analysis of the reasons for the low transnational index of Chinese companies, Xue thought, as the world's second largest economy, China has such a large domestic market to attract domestic and foreign investors. As a result, Chinese companies tend to tap into domestic markets to accumulate strategic resources and increase market influence.　　It is also reasonable for Chinese multinationals to devote their primary energies to developing domestic markets for some time, which also leads to lower cross-country indices.　　"From a long-term perspective," Xue said, "China's multinational companies need to accelerate their internationalization process to ensure sustained international competitiveness."　　Xue predicts that in the future China's OFDI will be kept to a higher speed relative to its inward-flow direct investment. This is due to government support, on the other hand, increased demand for natural resources by the rapid growth of China's economy spurred companies to seek natural resources abroad, and the government eased foreign exchange controls to make more rational use of China's huge foreign exchange reserves, making it easier for companies to invest abroad , the continuous upgrading of industrial structure in developed countries has also made some of the unused human and technical resources available to Chinese multinationals.