Securing Higher Grades Costing Your Pocket? Book Your Assignment at The Lowest Price Now!

China As A Global Investor In Business

tag 0 Download9 Pages 2,237 Words tag Add in library Click this icon and make it bookmark in your library to refer it later. GOT IT

Question:

Discuss about the China as A Global Investor In Business.

 

Answer:

Introduction

The development of the Chinese economy is creating strains in the international market. China is considered as one of the largest trading nation and the second largest economy. Almost $2.4 trillion net foreign assets were estimated in 2015 in China compared to Japan’s net foreign assets of $3.6 trillion. The reason behind the account surplus is the enhancement of net foreign assets (National Bureau of Statistics of China 2018). In China, most of the foreign assets investments come from the central bank by international reserves, invested by the U.S. as well as different kinds of treasury bonds and similar instruments. As the investment opportunities for the native business diminishes in China, excess capability and declining profitability has also increased in other nations, resulting in a commercial outflow of capital to run at a high level. “Go Global” investment strategy by China has made an extravagant foreign investment which amounted to USD 900 million it was also equivalent to 2.2% of China's inward FDI in the same year (National Bureau of Statistics of China 2018). 

Foreign Direct Investment inward flow in China

Foreign direct investment is a long-term relationship between investor and enterprise who are cumulatively heading towards the objectives of the business organisation which in turn impacts the economy of the country. Industries operating in an economy can profit through this process with advantages in the supply chain management as well. The industry gets profit due to Foreign Direct Investment and an overall economic development was introduced in China (Gilboy 2016). The flow of FDI is the sum of three components such as equity, capital, reinvestment earnings and investments; these aspects are connected with the inter-company debt transaction. The technical enhancement, administrative development and increase level of production is the area of focus in this business module. The significant portion of emerging market change is associated with the investment as well. In case of global investment, accurate reflection can be judged through the financial condition of China and series of domestic incomes that China acquired through this process.

 


In China, there are different special economic zones that were announced on the 15th session of fifth NPC. Zhuhai, Shenzhen, and Shantou had been announced officially by the government and after that Xiamen was added to the special economic zone (Cavusgil et al. 2014). According to the statistic provided by the China government, in between 1979 to 2006,a sum of 596,110 projects is run by the foreign direct investment. A utilizing value of US$1.67 trillion on foreign capital and a huge contract value had signed in that time (National Bureau of Statistics of China 2018). China became the largest receiver of FDI among the developing nations. Since the biggest portion of FDI has come from Taiwan and Hong Kong, China can gets a good amount of products from these countries as well. 57% of FDI is single-handedly delivered by Hong Kong. Almost 1000 foreign companies’ regional headquarters are situated in Hong Kong and this is the reason channelized investment is persisting in Hong Kong.

Basic drivers behind the change

There are some key drivers of FDI are as follows:

  • economic growth
  • rapid economic
  • industrial development

In case of economic growth, the business organisations that come up in the Chinese market are the main source of income as GDP. Technology plays a vital role in this situation.  The country has impactful performance in technology and that main reason for export in the country and industrial development. Resource movement and logistic facilitation are two other aspects that impacts industrial market. Logistic management is another productive aspect that will come in transforming the link and provide a constructive drive for the nation.

The most important analysis is channelizing through China, in recent years and foreign-invested firms are taking advantage of them. The reason behind why China has become a global hotspot is because the nation is manufacturing their own products and in case of diverse aspects of finance, marketing and accounting. China is now the official member of WTO. The nation has a huge domestic market which impacts the growth of economy, political stability, policy consistency and legal reformation of China is the major aspect of the distribution of their market (Peng 2012).

 


Industries are rapidly growing in China and in case infrastructure and production are the reason behind global development. Realizing the potential of the industry and possible outcome it is important to grab the market and make use of the opportunities of the external environment. A significant contribution to large-scale employment is catering to the employment requirement of the native people and they will develop the work culture as the nation’s economy is much known by them. In recent past, direct and indirect employment is around 13.1 million people and the GDP has risen up to 2.23% to 4.10%, which is an exceptional change that comes into the drilling of factors.

Chinese Government Plan

The Chinese government has ethics and cultures that are delivered in a written form as rules and legislation (Ruggie 2013). Foreign Banks are established and their business is also affiliated with China as well. The minimum capital of RMB is 1 billion and each brand must have a minimum of 100 million (National Bureau of Statistics of China 2018). The financial export market in China delivers bilateral trade execution in some place and all the components have synthesized the level of business opportunities in China as well.

China’s Overseas Direct Investment

The foreign direct investment opportunities in China are high in theyear2013-2016. Many investments from different countries happen in those sessions which also contribute to the economic development of China. Tapping into a new market and gaining superior technology used by the overseas foreign companies. Belt and Road is an Initiative that has been taken by the Chinese government. This initiative has helped the government develop connectivity with the Eurasian countries. It is also a way to ocean-based Maritime Silk Road and land-based Economic belt process. In the last few years, Belt and Road Initiative process has focused on the infrastructure investment, construction materials, automobile, real estate, railway and highway equipment transfer and iron and steel materials. The project is one of the most valuable prospect which covers more than 68 countries and enhancement of 40% global GDP. Opportunity and risk factor both come up with the simultaneous way and market opportunities for investment have risen up due to that process (Ahuja et al. 2012).  Almost 8000 Chinese-funded companies offshore by the Ministry of Commerce and total investment recorded as $93.8 billion (National Bureau of Statistics of China 2018). The growing global stock of Overseas Foreign Investment recorded in 2007 was $117.9 billion. The global enhancement of revenue and demonstrative approach to the international brand has got some advantages in China and that is the most important part of ODI. The Belt and Road Initiative process deliver economic cooperation as well and expansion of investment is impacting on this.

 


China’s old-fashioned monopolies, state-run efficacies, and community facilities are steadily pretty available to secluded and even foreign investment. China will pursue to encourage wider, more bi-directional directness, build foundations and devices that encourage teamwork and are well-suited with global trade and speculation guidelines. In case of emerging industries business opportunities are high and that is the reason most of the innovative economic structure has been undertaken by the country as well. Increasing openness and global integration process are also conducted through the government and cross-culture agricultural agreement also boosted up the contradicting nature of orientation.

China is among the top ten countries to have contractual projects. The commercial service areas are connectively advanced in China and lots of other countries are self-driven by that process. The purchasing and selling goods are centralized by several ministries and that is the reason Chinese ministry has evolved some sectional change in their government (Nolan2012). Bank of China, China Council for the Promotion of Foreign Trade section drives the trade national policy of China. Trades are separated from the production, thus a loss in production for any company has not directed apparent effect on the country’s economy. Most of the trades are confines in the communist countries so the range of monopoly situation in business is present in that nature. In China, the state-owned monopolized operations in business dampened into the production sector in China and that also not linked with the market situation. The market always wants the competitive figure and China is doing that only to establish their nature of ODI in front of international business scenario.

China selects their direct investment in theU.S. in most of the cases but in 2016 the projected outcome has turned a bit and Singapore has overtaken theU.S. in case of foreign direct investment ration in China. The paper states that China’s Ministry of Commerce has witnessed nonfinancial ODI rangeof 44.1 percent enhancement to $170 billion(National Bureau of Statistics of China 2018). Though, the inclination in 2017 has been in desolate dissimilarity. Chinese policymakers have required controlling “illogical” ODI and have determined on savings toward the Belt and Road proposal (Brødsgaard 2012). Singapore and Malaysia, these two nations have attractive BRI destinations and they have invested climate to offer good opportunities in business at a low level of risk. That is the reason most of the associate investment takes place in those countries and optimum balance present in both the countries.

Rise in Overseas Direct Investment in China

The Chinese government enhances the overseas business opportunities and noticed on the foreign currency reserves at home. In comparison with Japan, American firms are holding the assets in that nation but in most of the case expected foreign currency, thereserve is not met with the desired amount (Lasserre 2017). Approval of domestic trade policies and adapted formation of new business results are the concern idea that produces more productivity in China. In China, the reformation of theforeign direct system was revised after the implementation of SEZs(Ramasamy et al. 2012). Almost 30 up foreign trade companies are set by the government and trade licenses are also provided to them for business but in most of the cases challenges will arise when they have to find the easier way to mitigate those. In case of agricultural and rural products the rate of manufacturing is high and that provide less opportunity for the native nation to do the business, in that case, the importance of overseas business come information where other countries have this opportunity to invest in China. This is the particular time when trade liberation happens and through this process, China becomes the largest porter of clothing and textiles.

 

Current development and inflow of FDI in China

The distribution of country’s outward FDI flows in the industry level has segmented into different sections. Wholesale, retail, trade mining, fishery, information technology, construction, transportation, storage, real estate, washing, coal mining all these sections are under the ODI aspect of China. In case of metal mining resources, are theimportant and sectional distributions of theproduct are important for the development of national economy in China. As per the graph is given in appendix 2, mining is the largest sector from all as it contains 40.3% of total FDI concentration and most of the resources are collected from overseas companies. Though mining section decreases in 2015 compared with 2014 as well (Davies 2016). The restricted form of the industry and sharp contrast of accounting sector is the major aspect of annual growth and that flows with the diversified range of products (Deng 2013).

Conclusion

Therefore, all the discussions are addressing towards the overseas direct investment in China has surpassed the foreign direct investment. The report consists all the FDI and OFDI driving issues of China and the economic balancing situation that China has created in these recent times. The report also highlights the government initiation that possesses all the rules and regulations of business and development of inflow business FDI in China. The rise of ODI in China is discussed in the report and how it provides the benefit for the business organisations prevalent in china.

 

References

"National Bureau Of Statistics Of China". 2018. Stats.Gov.Cn. https://www.stats.gov.cn/english/.

Ahuja, Mr Ashvin, and Mr Malhar Nabar. Investment-led growth in China: Global spillovers. No. 12-267. International Monetary Fund, 2012.

Brødsgaard, Kjeld Erik. "Politics and business group formation in China: the Party in control?." The China Quarterly 211 (2012): 624-648.

Cavusgil, S. Tamer, Gary Knight, John R. Riesenberger, Hussain G. Rammal, and Elizabeth L. Rose. International business. Pearson Australia, 2014.

Davies, Ken. "China investment policy: An update." OECD Working Papers on International Investment 1 (2013): 1.

Deng, Ping. "Chinese Outward Direct Investment Research: Theoretical Integration and Recommendations. ??????????????: ?????." Management and Organization Review 9, no. 3 (2013): 513-539.

Gilboy, George J. "The myth behind China's miracle." In SEEKING CHANGES: The Economic Development in Contemporary China, pp. 1-16. 2016.

Lasserre, Philippe. Global strategic management. Palgrave, 2017.

Nolan, Peter. "Is China buying the world?." Challenge 55, no. 2 (2012): 108-118.

Peng, Mike W. "The global strategy of emerging multinationals from China." Global Strategy Journal 2, no. 2 (2012): 97-107.

Peng, Mike W. Global business. Cengage learning, 2016.

Ramasamy, Bala, Matthew Yeung, and Sylvie Laforet. "China's outward foreign direct investment: Location choice and firm ownership." Journal of world business 47, no. 1 (2012): 17-25.

Ruggie, John Gerard. Just Business: Multinational Corporations and Human Rights (Norton Global Ethics Series). WW Norton & Company, 2013.

Thebeijingaxis.com. 2018 Available at: https://www.thebeijingaxis.com/en/ [Accessed 28 Feb. 2018].

OR

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2019). China As A Global Investor In Business. Retrieved from https://myassignmenthelp.com/free-samples/china-as-a-global-investor-in-business.

"China As A Global Investor In Business." My Assignment Help, 2019, https://myassignmenthelp.com/free-samples/china-as-a-global-investor-in-business.

My Assignment Help (2019) China As A Global Investor In Business [Online]. Available from: https://myassignmenthelp.com/free-samples/china-as-a-global-investor-in-business
[Accessed 15 December 2019].

My Assignment Help. 'China As A Global Investor In Business' (My Assignment Help, 2019) <https://myassignmenthelp.com/free-samples/china-as-a-global-investor-in-business> accessed 15 December 2019.

My Assignment Help. China As A Global Investor In Business [Internet]. My Assignment Help. 2019 [cited 15 December 2019]. Available from: https://myassignmenthelp.com/free-samples/china-as-a-global-investor-in-business.


We provide all types of essays. comparision and contrast essays are common essays provided in assignments of high school and college. We have helped hundreds of students get epitomic comparision and contrast essays with valid points for and against and driving relevant and insightful comparision of ideas, topics, slants etc.Our comparision and contrast essays have a clear conclusive summary of all the points. No vague points are included in comparision.The essays have clear thesis statements and each paragraph contains clear topic sentences. Better than the best is what we aim for in such essays. Connect with us to ace your academic journey in style with quality works.

Latest Management Samples

ACC8003 Accounting Information Systems And Controls

Download : 0 | Pages : 6

Answers: Answer to question 3 The case of a furniture company is considered, there are various problems that are faced by the company at time of their growth. The issue is there are many unstaffed staffs that are not able to understand the basic operations and functions. Thus, for this training should be offered so that problem of failure could be resolved. While understanding the case study of Queensland’s furniture it was found that ...

Read More arrow

MGT601 Dynamic Leadership 1

Download : 0 | Pages : 8

Answer: Introduction: My journey as a leader started in my family. Being the first born, I had the responsibility to look after my siblings especially when the parents were not around. My parents trusted me, and they knew that everything would be fine when they were not around. They used to assign tasks such as feeding my young brother and ensuring that he does not cry. At church, I was appointed as the Sunday school leader, and I used ...

Read More arrow

HRMG204 Organizational Behavior 1

Download : 1 | Pages : 12

Answer: Introduction: The Australian Defense Force Academy failed due to the filming of two male and female cadets who were having consensual sex, whereby the female cadet did not know that they were being filmed (Welch, 2018 p.1).  The sex footage between the two cadets was streamed to a separate room where other cadets watched which resulted in two cadets being charged with the offensive use of a carrier service (Roberts-smit...

Read More arrow

MGT302A: Strategic Management

Download : 0 | Pages : 6

Answer: Introduction In the current economic world competition is very high. As a result, industries in the economic field have to find ways to ensure survival and to keep up with the competition. The survival of any business relies on opportunity creation that enables the business to explore new ventures and to equally compete with other businesses in the field. The opportunities created also ensures the growth of the business. The developme...

Read More arrow

BSBMGT608 Manage Innovation And Continuous Improvement 1

Download : 0 | Pages : 12

Answers: Question 1 Management by Objectives refers to a management approach where managers set objectives to improve performance in the future (Thomson, 1998). As an approach, it encourages managers and employees to continuously ask what needs to be done to improve the current situation and thus supporting innovation and continuous improvement. Question 2 The supply chain and service delivery systems include the following: Radio Freq...

Read More arrow
Next
watch

Save Time & improve Grades

Just share your requirements and get customized solutions on time.

question
We will use e-mail only for:

arrow Communication regarding your orders

arrow To send you invoices, and other billing info

arrow To provide you with information of offers and other benefits

1,164,507

Orders

4.9/5

Overall Rating

5,051

Experts

Our Amazing Features

delivery

On Time Delivery

Our writers make sure that all orders are submitted, prior to the deadline.

work

Plagiarism Free Work

Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

time

24 X 7 Live Help

Feel free to contact our assignment writing services any time via phone, email or live chat.

subject

Services For All Subjects

Our writers can provide you professional writing assistance on any subject at any level.

price

Best Price Guarantee

Our best price guarantee ensures that the features we offer cannot be matched by any of the competitors.

Our Experts

Assignment writing guide
student rating student rating student rating student rating student rating 5/5

93 Order Completed

100% Response Time

Jackson Mitchell

MiM (Masters in Management) in Supply Chain Management

New Jersey, United States

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2109 Order Completed

99% Response Time

Emma Zhong

Ph.D in Project Management with Specialization in Project Communications Management

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2279 Order Completed

97% Response Time

Zachary Perez

PhD in Computer Science and Information System

Washington, United States

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

1896 Order Completed

95% Response Time

Herman Berens

MSc in Psychology

London, United Kingdom

Hire Me

FREE Tools

plagiarism

Plagiarism Checker

Get all your documents checked for plagiarism or duplicacy with us.

essay

Essay Typer

Get different kinds of essays typed in minutes with clicks.

edit

GPA Calculator

Calculate your semester grades and cumulative GPa with our GPA Calculator.

referencing

Chemical Equation Balancer

Balance any chemical equation in minutes just by entering the formula.

calculator

Word Counter & Page Calculator

Calculate the number of words and number of pages of all your academic documents.

Refer Just 5 Friends to Earn More than $2000

Check your estimated earning as per your ability

1

1

1

Your Approx Earning

Live Review

Our Mission Client Satisfaction

thank you again, it is a good work, everything is perfect. I am very happy. It is not the first time and I know that I can count on you.

flag

User Id: 265909 - 14 Dec 2019

Australia

student rating student rating student rating student rating student rating

Gave them a small amount of time and they pulled through for me. Wonderful.Gave them a small amount of time and they pulled through for me. Wonderful.

flag

User Id: 357602 - 14 Dec 2019

Australia

student rating student rating student rating student rating student rating

It was very good work and I got an 85% on it. Thank you very much for your help and fast response

flag

User Id: 348363 - 14 Dec 2019

Australia

student rating student rating student rating student rating student rating

Was very good work and I get a full mark on it. Thank you very much for your help

flag

User Id: 348363 - 14 Dec 2019

Australia

student rating student rating student rating student rating student rating
Have any Query?