Trend Analysis of China

Topics: Corporation, Globalization, Multinational corporation Pages: 8 (2307 words) Published: February 17, 2013
2011 International Conference on Sociality and Economics Development IPEDR vol.10 (2011) © (2011) IACSIT Press, Singapore

The Investment Trend Analysis of Multinational Corporation in China Rashad Yazdanifard1 and Yan Yijie 2 Faculty of Management, Multimedia University, Cyberjaya, Malaysia 2 Center of Post Graduate studies, Limkokwing University of Creative Technology, Cyberjaya, Malaysia – Abstract. As the Director-General of the World Economic Forum Maccabees says, "Any company that claims to be a global multinational company, but no major initiatives in China, cannot be called a global multinational company. " This paper analyzes the trend and reasons of multinational investment in China. Meanwhile, it learns and absorbs so advanced experiences that try to make the adjustment of investment strategy in China. Based on the adjustment of China's economic restruction and industrial upgrading, it will lay a solid foundation for sustained and stable development of Chinese economy in the post-WTO era. Key worlds: multinational corporation,investment in China 1

1. Introduction
Multinational investment in China can be roughly divided into three stages: Firstly, 80s in the 20th century investigation and trial stages, which mainly for commodity trade and technology trade; secondly 90s large-scale into the phase of investment, mainly for concentrating on manufacturing field; thirdly since the late 90s, with the prospect of China's accession to WTO, multinational adjustment and rectification, full access, investment in China enters the stage of development. China is becoming an important production base for many multinational companies, procurement and R & D base, which shows that many multinational companies come to realize that the last piece of the world's great untapped market is Chinese market. As multinational corporations, they are not really the implementation of global strategy without a firm strategy in China. China and situation changes of the world economy are the main reasons why multinational companies promote to adjust the investment strategy in China[1]. The development of transnational companies in China shows a new trend in order to occupy and expand market in China as China's major investment approach: through a variety of ways and means of enhancing control over the investment enterprise in China; to a number of fronts, the rapid expansion of the industry; Products Localization of production and research and development, driven parts manufacturers moved to China to form a complete production chain and greater control of the technology spillover. Transnational Corporations Strengthen the view to the monopoly of the market, which led to the development of China's economic dependence[9]. We advocate legislation means to break the monopoly of transnational corporations, take positive measures to encourage technological innovation, create national brands and reduce dependence on multinational corporations.

2. Changes of Investment Trends in Multinational of China
In the early, the stages of foreign capital into China were establishing joint ventures, because China's degree of openness and the market are relatively low, the investment environment and poor. From 1979 to 556

1998, the share of Sino-foreign joint ventures and wholly foreign-owned enterprise was 44.88% and 30.96% respectively. By the following table I[6] we can see that from 1994 to 2004, foreign-owned trend continued to rise. Especially after China's accession to WTO, this change was more evident. In 2002, China's newly established foreign-owned enterprises reached 22,173; the number is 2.1 times of joint ventures[4]. In the 10 years from 1994 to 2004, the contract amount of sole proprietor increased from $ 21,949,000,000 to $ 117,275,000,000, turned 5 times. In 2004, foreign joint ventures and foreign investment amounted to $ 27,641,000,000, the ratio of increase was 8.37%, foreign-owned...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • China
  • Trend Analysis Essay
  • Essay on Trend analysis
  • Trend Analysis Essay
  • Trend Analysis Essay
  • Swot Analysis Rbc in China Essay
  • Essay about China Third Party Logistics Analysis
  • Analysis of China Unbalanced Case Essay

Become a StudyMode Member

Sign Up - It's Free