Chinese Enterprises Expanding Foreign Presence

Every year from late April to June， Thailands fruit of the season， durian， can be delivered to China in just 120 hours via a direct channel between the two countries for the delivery of fresh produce. Yet thanks to the intelligent logistics networks of Chinese enterprises， this time could be reduced to just 72 hours in the future.

Chinese logistics enterprises are among the countrys growing group of companies—both state-owned and private—that have been seeking a larger foreign presence to fulfill their global ambitions and to bring more benefi ts to the world.

With a long-term financial perspective， Chinese enterprises have accelerated the connection between global producers and consumers， enabling the country to move up the global value chain and creating more opportunities for themselves and the world.

While smart Chinese solutions are upgrading international logistics， big international acquisitions by Chinese companies have captured the global spotlight.

In February， Chinese carmaker Geely became the largest stakeholder of Mercedes- Benzs owner Daimler by acquiring 9.69 percent of the German luxury carmakers stocks for $9.2 billion， making it the biggest investment in a global automobile manufacturer by a Chinese company.

As more and more Chinese enterprises go global， Western investors have begun to benefi t from the Chinese market with its rapid innovation and massive scale， said Huang Guobin， head of Global Investment Banking for China at JP Morgan Chase & Co.

Chinese enterprises foreign presence has entered a new phase， in which they assist overseas investors in achieving greater global growth， Huang said.

Last October， tire maker Pirelli returned to the Milan Stock Exchange， marking the largest initial public offering in the European market in 2017.

The relisting came two years after it was taken over by China National Chemical Corp.， which changed Pirellis business focus to high-end consumer tires and expanded its capacity in China. Consequently， the AsiaPacifi c became one of the regions in which Pirelli made most of its profi ts in 2017.

This example， Huang said， demonstrates that cross-border acquisitions made by Chinese enterprises can introduce “Chinese genes” to local companies， which can help them grow as international enterprises.

As China accelerates its economic restructuring， more and more startups and new commercial patterns are springing up， hastening the Asian giants ascent up the global value chain， according to a recent report by U.S. management consulting fi rm McKinsey.

According to the World Intellectual Property Report in 2017， China has been at the forefront of the transformation and upgrade of the global value chain， as it is shaking off its label as the worlds factory.

With this trend， Chinese enterprises have had a profound impact on the global value chain. In 2017， Chinese investors made new， direct， non-financial investments in 6，236 overseas enterprises across 174 countries and regions， amounting to $120.08 billion， according to data from Chinas Ministry of Commerce.

Chinese businesses also undertook a total of 341 merger and acquisition projects overseas in 2017， with an actual transaction value of $96.2 billion， involving 18 industries spanning 49 countries and regions.

Chinese investments overseas have also expanded. The Belt and Road Initiative， proposed by Chinese President Xi Jinping in 2013， has also greatly facilitated the globalization of Chinese capital.

In 2017， Chinas new investment in 59 countries along Belt and Road routes reached $14.36 billion， accounting for 12 percent of the total volume and increasing by 3.5 percentage points over the same period last year， according to the Ministry of Commerce.

Online international news magazine The Diplomat pointed out in an article published in December 2017 that as Chinese enterprises continue to improve in scale， strength and competitiveness， they have the potential to reshape the global value chain.