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Xie Boyang: Chinese Companies Should Make Good Use of Foreign Capital in Overseas Investment and M&A

Source: People.cn Date: 2016-12-26


The third Conference of China’s Outbound Forum was held in Sanya at 18:30 on December 2nd. The theme of the forum is “the drive of China’s overseas investment: stronger cooperation and diversified co-existence”. Xie Boyang, former Vice Chairman of the All-China Federation of Industry and Commerce and Counsellor of the State Council, shared his views on Chinese companies’ overseas investment in his address to the conference.

Mr. Xie said it is important to focus on the following four areas in analyzing Chinese companies’ going-global efforts.

First, diversification should be encouraged in the manufacturing sector. China’s manufacturing sector is moving up to the higher end of the value chain. We must have a global strategy across the industrial chain to integrate resources in brand, technology, standard, resources, management and talents, so as to reduce cost and improve quality and efficiency.

Second, Chinese companies should be encouraged to go from Asia to the world. Investment in Asia should be a priority in China’s Belt and Road Strategy. According to Xie, there were 180 cases of investment in Asia by Chinese companies last year, accounting for 30% of the total and involving US$386.575 billion, more than Chinese investment in Europe and elsewhere.

Third, private companies are encouraged to take the lead. Xie Boyang believes that private companies operate on market-based mechanisms and institutions. They are more flexible and efficient in overseas investment. Large private companies and private companies in the manufacturing sector should be encouraged to take the lead, followed by small and medium-sized enterprises.

Fourth, the use of foreign capital should be encouraged to promote global cooperation. Chinese companies, private companies in particular, must make good use of foreign capital in overseas investment and M&A. Chinese companies should continue to use foreign capital as they go global. Long-term investment based on good faith should be encouraged.