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Fleeing the Great Game: Why Are Chinese Companies Going Global?

  • Joel Backaler

Abstract

Beginning in the late 1990s, headlines about massive investments in China by Western multinational companies became an everyday occurrence. “Procter & Gamble will invest $1 billion in China,” “The Coca-Cola Company plans to invest $4 billion in China over the next three years,” and “Cisco is placing a $16 billion bet on the China market” are just a few examples. China was quickly becoming the world’s largest recipient of foreign direct investment (FDI) under new reform and opening efforts known collectively as its qing jinlai (请进来) “please come in” policy. Chinese firms competed fiercely among themselves and with their new Western competitors to establish themselves as market leaders in their respective industries. At the same time, China adopted a new stance on overseas direct investment (ODI) expressed as zou chuqu (走出去) “go out,” The “go out” policy, announced in 1999 by the Central Committee of the Chinese Communist Party and formally initiated in October 2000, encourages and supports Chinese companies to invest overseas through incentives and subsidies as well as liberalization of regulatory systems and administrative rules. Chinese government officials commonly use both phrases together1 when discussing China’s development strategy as qing jinlai, zou chuqu (请进来,走出去): the government both welcomes foreign companies in to China while encouraging its own firms to “go out.”

Keywords

Foreign Direct Investment Chinese Company Chinese Communist Party Chinese Firm Soft Power 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

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    Qianren jihua. “Renwu Ku.” 2013. Web. 8 September 2013. [http://www.1000plan.org/wiki/index.php?doc-view-1048].Google Scholar
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    WuXi PharmaTech. Chinese Premier Li Keqiang Visits WuXi PharmaTech’s Headquarters in Shanghai. 1 April 2013. Print.Google Scholar
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    UNCTADSTAT. “China’s outward foreign direct investment flows.” 2013. Web. 8 September 2013. [http://unctadstat.unctad.org/TableViewer/tableView.aspx].Google Scholar
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    IBM. Lenovo to Acquire IBM Personal Computing Division. 7 December 2004.Google Scholar

Copyright information

© Joel Backaler 2014

Authors and Affiliations

  • Joel Backaler
    • 1
    • 2
  1. 1.Frontier Strategy GroupUSA
  2. 2.The National Committee on United States-China RelationsUSA

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