Overseas Investments Jump 60%

China's overseas investment hit $21.16 billion in 2006, up 60% over the past five years.

Overseas investment by Chinese enterprises has developed from setting up branches to:

1. build factories

2. purchase and acquisition

3. equity swapping

4. list on overseas stock markets

5. establish strategic cooperations

Some 40% of the overseas investment went to purchases and acquisitions -

a. South African mines

b. British mining companies

c. IBM's PC business

d. CITIC's acquisition of Kazakhstan oil fields

e. China mobiles' purchase of a Pakistan telecommunications company 

The major reasons -

1. domestic enterprises want to seek more developing room overseas

2. state loosened its control on overseas investment

3. overseas mergers and acquisition are seen as the best way to become internationalized.

China is looking to buy:

a. famous brands

b. advanced management experiences

c. marketing networks

China has a much greater impact on the world stage than it did just 10 or so years ago…and the influence is bound to grow.

What do you think?