Bernadette Andreosso- O’Callaghan and Christopher Dathe
A weakened European Union (EU) economy after the 2008 euro crisis may have been seen as an opportunity for the relatively resilient Chinese economy and its cash-rich firms. It might be that the euro crisis represented a turning point for Chinese outward direct investment (ODI) in the EU and in particular in the distressed euro area. The analysis of Chinese investment deals in the EU with an emphasis on inflows since the euro crisis brings some elements of response to these questions. After a review of the institutional framework supporting ODI since the implementation of the Chinese economic reforms in 1979, the chapter shows that Chinese ODI in the EU has been opportunistic and that it has followed a strategy of sectoral diversification. Although the UK is still the main recipient of these Chinese flows as at 2015, peripheral countries such as Italy and Portugal have increasingly been sought after. Key words: Chinese ODI, European Union, Chinese outward investment policy, ‘going global strategy’, euro crisis.
Zhao Guoqin and Sam Dzever
Transaction cost has emerged as a core concept in the New Institutional Economics (NIE) and an important theoretical tool for researchers in this field. Measuring transaction costs and the quantitative analysis of the relationship between transaction costs and other economic indicators has become a central theme of analysis in the NIE. By measuring China’s macroscopic transaction costs since 1978 and utilizing a dynamic econometric model, this chapter analyzes the relationship between macroscopic transaction costs and China’s economic growth and trade structure changes. The findings suggest that in the mid- and long-term, growth in China’s macroscopic transaction costs does stimulate exports while restraining domestic trade. Thus, macroscopic transaction costs can be said to have indirectly changed China’s trade structure leading to the persistent surplus it has recorded against its major trading partners over the last few years. Key words: macroscopic transaction costs, economic growth, trade structure changes, Chinese economy.
Telecommunications and smart mobile devices have now become some of the key export areas for South Korean companies. As with the other products and services that come from this East-Asian country, the bulk of exports originate from giant, family-run Chaebol multinational corporations (MNCs). The major Korean players in ICT over the past three decades have been Samsung, SK, Korea Telecom (KT) and LG. However, in recent years Samsung has started to move significantly ahead of all its domestic competitors, becoming a major global company in a relatively short time period. In 2009, Samsung reached the pinnacle of its field by being recognized as the world’s largest ICT company based on revenue, and it held that position throughout the next five years. ICT and mobile devices may be Samsung’s main source of revenue but the company conducts business in a diverse range of industries including shipbuilding, construction, consumer electronics, retail and insurance. In this chapter, the focus is on how Samsung created a close relationship with the Korean government in the ICT area; effectively creating a protected business environment that assisted with its global expansion plans. Key words: ICT, telecommunications, technical barriers to trade, Korea.
Bernadette Andreosso- O’Callaghan
With the economic rise of China, the issue of outward direct investment (ODI) in advanced economies by emerging countries has attracted widespread attention since the mid-2000s. Developing Asia accounts for nearly one-quarter of all ODI flows. Japan, Taiwan, South Korea and other ‘Asian tigers’ were all the pre-cursors of ODI from emerging economies in Europe and the USA after World War II. What is different today is the scale of the phenomenon and the pace at which it has evolved in just ten years, particularly from China. This chapter offers a review of the literature on ODI from East-Asian emerging economies. A discussion on the suitable theoretical background is proposed; old ‘mainstream’ theories are concisely and critically discussed in light of current insights drawn from the recent literature that could evolve eventually into a new or a substantially reformulated theory. Key words: emerging countries, foreign direct investment (FDI), FDI theory, Asia.