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Why Do Chinese Companies Want To Go West?

Joel on March 2, 2014 - 1:22 am in Insights
Geely-Volvo

(image from: carsroute.com)

The following excerpt is from a 6-part series in Forbes about Chinese overseas investment. For the original article click here.

“Is a Chinese government strategy pushing corporate champions to invest overseas or do straightforward commercial motivations explain this phenomenon?

The answer is both. Chinese companies go global because of government objectives as well as business necessity. It would take an entire book to do this topic justice, but the following sections offer a high-level overview of the multiple motivations for Chinese companies to expand into international markets.”

Government motivations and business motivations introduced in the post include:

Government Motivations

  • Invest foreign exchange reserves outside of China
  • Secure natural resources critical for the Chinese economy
  • Create “national champions” to boost economic influence and soft power

Business Motivations

  • Acquire new and advanced technologies
  • Develop global management talent
  • Gain access to international brands
  • Geographic diversification

What other motivations exist? Leave a comment and let us know what you would add…

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