Chapter 22: Corporate China Goes Global
Friedrich Wu Recent high-proﬁle international acquisitions and takeover bids by mainland Chinese companies have dramatically shifted media attention from spotlighting China as a ‘giant sucking vacuum cleaner’ for global inward foreign direct investment (FDI) to characterizing the country as a cash-rich ‘predator’ embarking on a global buying binge. Despite the latest public frenzy stirred up by Chinese companies’ accelerated cross-border merger-and-acquisition (M&A) forays, a large number of these enterprises have actually been discreetly internationalizing their operations for some years, without attracting a lot of media limelight (Wu, 1993, 1994). Nonetheless, the phenomenon of China’s rising outward FDI has provoked some intense interest lately. Among academic studies, even the most recently published delineation at the macro level (Wong and Chan, 2003; see also Wang, 2002) was rather dated, as it was based on 2000–2001 data. The purpose of this chapter is therefore two-fold: to update the macro picture with the latest available data and to oﬀer a more micro-analysis from the ﬁrmlevel perspective. THE MACRO PICTURE Accelerated Outward FDI in the 2000s While cross-border acquisitions and takeover bids by mainland Chinese companies have only recently captured international news headlines, the Beijing government has been formulating and executing the ‘Go-Out’ policy since the early 1990s. The latter was conceived as a critical component of the ‘Open-Door’ policy promulgated in late 1978. As President Jiang Zemin declared during the 14th Chinese Communist Party (CCP) Congress in 1992, ‘to open wider to the outside world . . . we should encourage enterprises to...
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