#1Chinese investment in The Netherlands Patterns and drivers E KWD 40.20 KLOW 128.45 +20 UIOP 2.34 0.5 RFWE 45.23 6 FQUP 129.40 +30 KHYN 38.45 +2 JKWD 40 28-3 KLQW RSD 38 45 +2 BBW 40 0.5 RFV Presented by Wendong Deng Rotterdam School of Management B SSSC, 13 NOVEMBER 2014 ESSCA SCHOOL OF MANAGEMENT, SHANGHAI D#2Authors Wendong Deng Enterprise Governance Structure • Social capital Managerial vision Diversification strategy [email protected] Ona Akemu Developing country MNEs Corporate social responsibility Entrepreneurship . Impact on host country [email protected]#3China and the Netherlands • NL: the 2nd largest trading partner of CN for 11 years, and the 3rd largest direct investor. • CN: the largest trading partner of NL outside EU and the 2nd largest investor.#4China and the Netherlands Major Cooperation Areas Original Mal Goud garantiert Wochen Careift#5Roadmap of my talk 2 Background Types of Chinese outward investment Where does investment go? Policy debates in Europe In NL Key figures and patterns The pull factors - why NL attractive? Success and failure 3 In China Push factors The domestic situation 4 Trends What's in it for you?#6What do I mean by China?#7Types of Chinese investment abroad THE Portfolio investment 2 ******* 1789 TREASURY Liquid investment China holds $1.3trln T-bills Total reserves $3.4trln CHINESE FOOL OPEN 'Retail' investment Owned by immigrants Small scale Not tracked by investment agencies 3 Source: Financial Times, US Gov Treasury Real estate investment High net-worth individuals Residence permit, passport key drivers 4 Foreign direct investment Purpose is control of Dutch enterprise Encouraged by investment agencies#8Now, some definitions... Foreign direct investment (FDI) lenov Group L d 10 Annual ults FDI stock FDI flow 'Cross-border investment associated with lasting interest/control in company' 'Net value of all FDI held by foreign firms (Chinese) in country (Netherlands) at year end' 'Net amount of FDI that flows into a country in a year.'#9China rising in absolute terms: FDI stock nears $2trln Chinese outbound foreign direct investment stock, 1990-2012 ($billion) 2,000 1.800 1,600 1,400 1,200 1,000 800 600 400 200 China (incl. Hong Kong and Macau) Mainland China Source: UNCTAD. 0 extracted 16.08.2013 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012#10China rising in relative terms - contributing larger share Outbound FDI stock of top investing countries as percentage of total global OFDI (1990, 2012) 1990 2012 5 10 15 20 25 30 35 40 5 10 15 United States United Kingdom 35.0 United States 11.0 China 7.7 Japan 9.6 Germany 7.2 United Kingdom 7.7 France 5.4 Netherlands 5.0 Germany 6.6 Canada 4.1 France 6.3 Switzerland 3.2 Switzerland 4.8 Italy 2.9 Sweden 2.4 Japan 4.5 Brazil 2.0 Belgium 1.9 Belgium 4.4 Australia 1.8 Netherlands 4.1 Taiwan 1.5 Canada 3.0 China 0.8 Total global OFDI ($2.1 trillion) Source: UNCTAD. extracted 16.08.2013 China includes Hong Kong and Macau 20 20 Total global OFDI ($23.6trillion) 22.0 25 25#11Recent Trends Chinese outbound FDI will accelerate • • In 2013: China's outbound FDI is $107.84 billion, a 23% increase YoY. Total FDI stock reached $660 billion. In the first 9 months of 2014, outbound FDI increases 22% YoY. China's outbound FDI may exceed inbound FDI in 2014. 825 APEC CHINA 2014 AP 'China's outbound foreign direct investment over the next decade is expected to reach $1.25 trillion' Source: Xinhua. Extracted: II.11.2014#12Looking at Europe...#13Where some of the investment goes High-profile M&A's in Europe by Chinese companies $2.2 billion (Sinochem) E Elkem VOLVO $1.5billion (Geely) EUROSIBENERGO $2.3billion (Three Gorges) $1.2billion (Bright Foods) Weetabix $3bln (China Development Bank) हु BARCLAYS $360million (Fosun) Club Med $3.2billion (China Investment Corporation) GDF Suez MEDION $670million (Lenovo) ADDAX PETROLEUM $7.2billion (Sinopec) $3.5billion (Three Gorges) edp Source: The Heritage Foundation; Reuters.com Map not to scale Copyright worldatlasbook.com#14Where does the rest go? It depends on who you ask Top ten recipient countries of Chinese OFDI in Europe 2010 stock (Єmillion) 0 1,000 2,000 3,000 4,000 5,000 6,000 Luxembourg Germany 1,502 Sweden 1,479 United Kingdom 1,358 Netherlands 487 Hungary 466 Spain 248 France 244 Italy 224 Ireland 140 Source: Chinese MOFCOM, 2010; Rhodium Group 2012 0 500 1,000 1,500 2,000 2,500 3,000 5,787 Norway 2,769 Sweden 1,022 Germany 789 Austria 509 Denmark 504 United Kingdom 439 France 350 Italy 319 Japan 299 Netherlands 268 Source: Eurostat. Extracted 19.08.2013#15Gobbling up European assets? Source: The Economist#16Chinese 'stealing' European know-how? BARLAMENTET EUROPÄISCHES ΕΥΡΩΠΑΪΚΟ ΚΟΙΝΟΒΟΥΛ PARLAIN EIROPAS PARLAMENTS MENT EUROPEEN -PARLAMENT EWROPEW PARLAMENTO EUROPEU ENT EUROOPAN Em, no evidence of that... China Invests in Europe Patterns, Impacts and Policy Implications Rh HOORM GROUP June 2013 'I am in favour of foreign investments ...but the question is if the Chinese company will invest in Europe or if this is a camouflage to bring know-how to China' 'We see vanishingly few [Chinese investments], which seem senseless from the perspective of commercial logic... (page 68) Antionio Tajani, EU industry commissioner (2010) speaking on Xinmao's failed bid for Dutch firm, Draka. Italian company Prysmian finally bought Draka for €900million Source: Reuters.com#17Fuelling Europe or... eu LI MIN/CHINA DAILY#18SALE PING Made TED Spain Shopping spree Peter Schran#19Let's take a closer look at the Netherlands...#20Chinese FDI in NL has also increased markedly Chinese outward FDI stock in The Netherlands 1990-2011 (Єmillion) 3,000 Source: De Nederlandse 2,500 2,000 1,500 1,000 500 €2,625million China (incl. Hong Kong and Macau) A Mainland China Bank, Extracted 16.08.2013. Excludes special financial institutions (SFIs) I 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010#21You've probably heard about these 2002 kruidvat €1.3billion 2003 ect Europe Container Terminals €10.4million* BHO HAL KC 2013 AVR (Van Gansewinkel) Li Ka-Shing (85), Chairman Hutchinson Whampoa €944million *Transaction recording increased stake from 79 to 98%#22How about these? Acquirer Target Date Consideration Stake 乐普医疗 Comed 2011 €1.4million 40%* connecting excellence LEPU MEDICAL ГЕБО NEDICVГ SINO EM NAVINFO➤ DSM 2011 €210million 50% BRIGHT SCIENCE. BRIGHTER LIVING. (Anti-infectives business group) mapscape 2011 €7million 100% *To invest additional 3.5million raising stake to 70% Source: company websites, press releases, Zephyr database#23You'd be smiling too... Source: BYD website#24A feel for range of 'parents' Size of parent company Very large (>$500mln) Large ($50-500mln) Small, medium ($1-50million) Source: Company websites, annual reports; Orbis database; Publicly-listed JMC ZTE中兴 TXCMG ZEMC HIKVISION Publicly-listed BYD NAVINFOX SNBC Publicly-listed 曙光 Shuguang State-controlled HUAWEI PERFECT WORLD CHANT GROUP LEPU MEDICAL Controlling party Publicly-listed JL MAG HIGH END MAGNETICS Ksweat 筆聯世紀工贸有限公司 China United Century Enterprises Ltd F&V Privately-controlled#25Active in sectors from automotive to travel Automotive Communication equipment 陆风汽车 青年汽车 NAVINFO) LANDWIND YOUNGMAN HIKVISION nnn Conglomerates | 中国恒天集团有限公司 CHWIL CHINA HI-TECH GROUP CORPORATION Hutchison Whampoa Limited Dairy products 澳优·海普诺凯 Ausnutria Medical devices LEPU MEDICAL Toys, juvenile vehicles Goodbaby 好孩子 Financial services ⑥ 中国银行 ICBC 中国工商银行 BANK OF CHINA ( Mining & construction machinery GLIUGONG Transportation equipment Industrial computer systems NORTO Telecommunication equipment HUAWEI CIMC 中集 中国南方航空 CHINA SOUTHERN ZTE中兴 Travel CITS 桂林国旅#26Wholly-owned and brownfield investments Ownership ZPMC EUROPE CRANE SOLUTIONS HIKVISION Wholly owned subsidiary HUAWEI ZTE中兴 中国银行 BANK OF CHINA ICBC 中国工商银行 E Joint venture BUNAZAN mapscape (inalfa root systems group kruidvat XEMC DARWIND ORIENT Technologies GINAF AMCA HYDRAULIC HU CONTROLS INDUSTRIAL AND COMMERCIAL BANK OF CHINA ect Europe Container Terminals 陆风汽车 LANDWIND Greenfield Establishment mode Brownfield A COMPANY OF CIMC BURG#27Put it in perspective... What percentage of Dutch inward FDI is $2,625million?#28Reality check Chinese FDI in NL still a drop in the bucket. US is still our most important foreign investor Inward FDI stock in the Netherlands per country of origin (2011), €'000 million United States of America Luxembourg United Kingdom Belgium Germany Switzerland France Ireland Bermuda Japan Netherlands Antilles and Aruba Sweden Rest of Europe (non-EU) Rest of the world (non-Europe) Denmark Italy Cayman Islands Norway Malta, Cyprus Spa in China (incl. Hong Kong. Macau) Australia Israel Austria Finland Canada Source: De Nederlandse Bank, Extracted 16.08.2013. Excludes SFIS Singapore Malaysia United Arab Emirates South Korea Portugal Russia 10 20 30 40 Chinese FDI : €2,625million = 0.6% FDI in NL 50 60 70#29How many Chinese companies in NL? It depends on what you mean by Chinese-owned companies nvest :: Utrecht WESTHOLLAND oost nv Parents registered in China (mainly mainland). Sectors focus - life sciences, creative industries, agri-business. Qualities that count BOM FOREIGN INVESTMENTS Brabant, Europe's heart of smart solutions NOMLIOF OMFL Wy werken aan volend Do not track investment by Chinese individuals or in retail, 'horeca'. Netherlands Foreign Investment Agency I amsterdam. Similar to regional investment agencies. Help companies set up in NL. Companies owned by first-generation, second-generation Chinese from mainland China, Hong Kong, Macau, Taiwan. 670 in Amsterdam MRA. Predominantly in ‘horeca', financial services Sources: Gemeente Amsterdam, Chinees ondernemenschap in Amsterdam in beeld (2012)#30Sectoral spread Textile, apparels is the dominant sector for mainland Chinese firms Textiles, apparel, accessories, and leather Electrical, electronic, telco equipment Consumer goods Professional services Other services Industrial machinery Non-specialised retail Food, beverages and Tobacco Chemicals Transportation and logistics 02 Source: own analysis of NL firms with Chinese ultimate owners in Orbis database 4 6 8 10 12 14 310 entities (Mainland China)#31Functions Wholesale & retailing (often a.k.a. marketing, sales) main functional activity of mainland Chinese companies Wholesale & retail 69% 160 Finance/holding companies 9% RESEARCH Professional services INNOVATION GROWTH SALES STRATEGY VISION TEAMWORK 13% MARKETING#3253% of Chinese firms less than 5 years old Number of Chinese subsidiaries established in Netherlands per five-year period between 1980 and 2013 250 200 150 100 11% 50 7% 2% 3% 0 Before 1980 1980-1989 1990-1999 25% 53% 2000-2004 2005-2009 2010-2013 Source: own analysis of 441 NL firms with Chinese ultimate owners in Orbis database#33Many, many small companies; located in Randstad 30 35 Percentage of Chinese-owned firms employing only one person Percentage of Chinese-owned firms employing more than five people 50 Percentage of Chinese-owned firms located in Amsterdam, Rotterdam, Den Haag, and Schiphol areas 519 Highest number of employees at Chinese-owned firm (Huawei, 2011) Source: own analysis of 441 NL firms with Chinese ultimate owners in Orbis database#34Where do they come from? 40% of mainland firms come from first tier, second tier cities from the East Coast of China .Harbin THE NORTHEAST Jilin Shenyang Beijing (14%) •Orümqi Hohhot Daljan Beiji Qingdao (2%) Shijiazhuang gdao INNER MONGOLIA & SILK ROADS Yinchuan Taiyuan. BEIJING & THE NORTH nan YELLOW SEA Shanghai (10%) Xinine Zhengalpu Lanzhou Nanjing Hangzhou (4%) hanghai Hefei Hangzhou Wuhan Wenzhou (9%) Chengdu TIBET Chongqing 310 mainland Chinese-owned entities only. Excl. 131 Hong-Kong firms THE SOUTHWEST Kunming CENTRAL CHINA Nanchang Changsha Guiyang Guan Nanning Haikou Fuzhou THE OUTH PHong Kong & Macau Fuzhou (2%) Guangzhou (3%) Shenzhen (7%)#35So far... Most firms are less than five years old 4 2 Predominantly in 'wholesale & retail' 3 Textile, apparel dominant sector 5 Mostly from 4 cities on Mostly 1-5 person operations the east coast#36Why do they come to The Netherlands? Country factors Access to markets Access to technology Other?#37Country factors iceland Atlantic Ocean Spain Source: Ernst & Young (2012:15) U.K. Norwa Sweden Geography Finland Denmark Poland Germany Czech rep France Switzerland Austria Hungry Greece Russia Workforce Sure, taxes? Belastingdienst#38Access to market They target Dutch and proximate European markets HIKVISION LIUGONG LAMEWIND 陆风汽车 LANDWIND Founded 2001. Sales (2012) - $1.1 bln Set up 2009 in Hoofdorp Sales, marketing, European HQ Source: company websites, annual reports, BOM foreign investment Founded 1958. Sales (2011) - $2.9bln Set up 2012 in Almere Sales, marketing, European HQ First Chinese vehicle to obtain complete European type-rating Set up 2011 in Helmond. Research, test, sales, marketing#39'Holland is traditionally a strong country in the dairy industry. Their quality of milk resources and techniques is one of the best in the world. The environment of milk resource is unique and can't be copied. Yuanrong Chen, CEO of Chinese company Ausnutria on the 2011 merger between his company and Dutch dairy firm, Hyproca. Source: PRNewswire (June 2011)#40A study of nine R&D Dutch firms which were acquired by Chinese parents Tom Hoorn, RSM (2012)#41Managers speak Why was your company acquired by Chinese parent? Client Browser Server Application 1-10 HTML D Da Server knowing-i know-it-all (n rything and re knowledge iarity, awaren study. 3. The ered, or lear 'It is about the hard technologies...it is also about organisational expertise and financial management, so the soft side of innovation' Managing Director, Company A 'They saw what we could provide for them and they were very interested in our competencies to develop products ready to be applied in their systems' Managing Director, Company F 'They really bought company for knowledge and development competencies that we have here' R&D Manager, Company H Source: Hoorn (2012)#42BMW 18 Concept G. Magbanua PhotUNTEDx 'The quality level of industrial vehicle development is higher in Europe... China lags twenty years behind us, but they see that they have to develop. Integrating our local development capabilities and know-how helps them solve problems they face' Managing Director, Company C Source: Hoorn (2012)#43Getting some ‘special punch' Examples of acquisitions of tech companies in NL by Chinese parent 2007 A COMPANY OF CIMC =BURG= 2009 XEMC 湘田集团 DARWIND CIMC acquires 80% of Burg XEMC acquires Darwind Sum €108mln €10mln Assets KEN Source: AAC Capital Partners (2011); China Daily (2011); Zephyr; company websites 2011 2011 Inalfa root systems group GINAF 2012 mapscape Beijing Hainachuan Automotive acquires Inalfa Roof Systems China Hi-Tech Group acquires GINAF Navinfo acquires Mapscape Undisclosed CAND- HYUNDAI KOLES Undisclosed €7 mln#44Institutional quality 'I feel good to pay taxes here [in Netherlands]' 'In China, local government does not care about us because we are small company. But here they welcome us' ...here I don't need guanxi with tax authorities' Chinese entrepreneur speaking about tax office, NFIA support in doing business in The Netherlands. Name undisclosed for confidentiality reasons#45OK, it is not always that simple Mixture of strategic asset-seeking and seeking new market/customers ▷ Deepen design capacity 2 Follow existing customer Company has existent R&D capability. Invests in NL to deepen capacity for European market Company targets Chinese customers 'going global', Dutch companies going to China Examples Goodbaby #7777 ◎ 中国銀行 BANK OF CHINA ICBC 宮 中国工商银行 3 Always strategic? Not sure, but... ?#46Yep... VERBLIJFSDOCUMENT PLATS IN DATUM AFGIFT Vervangen voor 28-04-16 IND Amsterdam 29-04-11 TYPE DOCUMENT NLD REGULIER ONBEPAALDE TUD 4025 Dutch Residence Permit. Permis de Sejour Staat der Nederlanden-2001- Alle recht Source: Rotterdambusinessschool.nl#47Don't discount copycat behaviour 3月5日爆 DADDY DAY CAMP THE SUMMER IS GOING TO BE IN TENTS. URFN 大胃王 玩死你一boss 联合出品,北京紫金长天传辉文化有限公司 发件 福建恒业影視公司上 温和个人 王庆员#48How do they come?#49Most important factor in identifying target for acquisition? Relationship or familiarity with target In-house team screening potential targets Government guidelines on preferred sectors Target company offering to be acquired Bankers/other advisors introducing target Private equity/other shareholders offering to sell Other 4% Source: KPMG Report, World Class Aspirations (2010) 15% 47% 45% 57% 55% 77%#50Pre-investment preparation channels How did you prepare before investing in the Netherlands? 80% 60% Other 40% 20% 0% Chinese Embassy and Chinese agencies in the Netherlands Market research Feasibility study Obtaining tax and legal advice Contact with Dutch Government agencies in China Fact finding and site visit to the Netherlands Source: Ernst & Young (2012:34)#51Beware of the frogs!#52Are the SMEs well-prepared? Source: somedesignblog.com ว My business plan? Well, my plan is to have a business, obviously.#53What do Chinese firms bring to NL?#54Listen to managers again What is the benefit of being acquired by the Chinese parent? PREPARE TO LEARN help what do I do next PLAN PLAN 'They teach us about requirements for many applications in larger systems in Chinese market. We are specialised in a very small niche. By doing joint projects, it helps us grow. Managing Director, Company B 'We gain practical experience in applying our technology in the Chinese market. We need lab tests and research before building a prototype...they have hundreds of installations running in China so they have a lot of practical experience.' Managing Director, Company G Source: Hoorn (2012)#55How successful are Chinese-owned firms? WINDPOWER Home News Global Regions Reports Insight Events Windpower TV BNR.NL MAAKT GEBRUIK VAN COOKIES OM DE WEBSITE EN HET GEBRUIKSGEMAK TE OPT AEX 369,26 +1,74% 19" GEHEEL BEWOLKT 9 FILES/0 FLITSERS Int 15 JAAR BNR NIEUWS Meteorological TECHNOLOGY WORLD EXPO 15-17 Octob WEBCAST: Drive operational efficiency come rain or shine CHINA XEMC invests EUR20 million in Darwind 28 September 2012 by Wu Q), Be the first to comment CHINA: XEMC is to invest €20 million in its European subsidiary XEMC Darwind with the aim of increasing its turbine R&D. Inalfa haalt voor miljarden aan opdrachter Door Noud Broekhof 15 maart 2013 07:28 PM Vind ik leuk 24 Tweet 12 Share GOOGLE TRANSLATE Select Language SHARE THIS Tweet in Share reddit this! An XEMC 115 being installed XEMC said the new investment will increase the registered capital of Netherlands-based Darwind from €90.000. The aim is for Darwind to use the money on the development of offshore turbines. (update 2 October- there have been reports XEMC has been in talks with offshore manufacturer BARD). Source: Windpower; BNR.nl LATEST ARTICLES Mitsubishi Corp and Barclays affiliate to buy London Array's seabed cables Vechac hints at De Nederlandse toeleverancier Inalfa Roof Systems heeft de afgelopen elf maanden ruim 2,5 miljard euro aan nieuwe opdrachten binnengehaald. Dat laat de topman Marcel Schabos weten op BNR. http://www.bnr.nl/?service=player&type=fragment&articleld=1829720&audiold=1829727#56SMEs also have their stories How successful have you been in NL? Two Chinese SMEs tell their stories Industry Wood products Why did you invest in NL? Decline of U.S. business Studio equipment Proximity to customer; new customer Business performance since start What else? ↑30% Main market is Germany, but Dutch market also good. Need additional employee ↑10% Market better than expected. Need more employees Source: Disguised for confidentiality reasons 'New world open for me'#57How about failure? Annual number of net 'surviving' and closed Dutch subsidiaries of Chinese parent firms (2000-2013) 60 50 40 30 Failure rate 20 22% 10 Number of 'surviving' offices Failure rate 4% Number of 'closed' offices 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Source: NFIA (Onno Bogers)#5838% of Chinese firms disappeared after two years Source: One of the investment agencies (Confidential)#59Chinese companies attracted to Netherlands by... 2 3 4 Access to know-how Follow competition (Dutch 'special sauce') (copy-cat, SMES?) ahem, immigration benefits (applies to Access to European market Do they succeed or fail? some SMEs)#60Now, China#61What pushes Chinese firms to internationalise?#62Cost Differentiation Technology Linkages with other firms NAVINFO> 青年汽车 YOUNG MAN XCMG CIMC中集 Internationalise to gain technology, but focus largely on Chinese market Internationalise to gain technology, develop innovative capability, open channel to 'sophisticated' European market. 佳 中国恒天集团有限公司 CHINA HI-TECH GROUP CORPORATION Internationalise as part of diversification Build relationship 洗心 光明食品(集團)有限公司 FOSUN 复星 BRIGHT FOOD (GROUP) CO., LTD. (brand, marketing) Chinese consumers more 'demanding'. Firms internationalise to acquire established brands principally for Chinese market BYD HUAWEI Acquire, build own brand internationally. Move beyond being 'Chinese' company Price Many Chinese companies compete here Chinese market Market focus NORCO HIKVISION Internationalise to NL to sell essentially same product as in China. Many SMEs do same International market#63Trend of OFDI?#64WALL STREET JOURNAL. MARK MONEYBEAT BANKS PRIVATE EQUIT HOT TOPICS: VERIZON WIRELESS MICROSOFT-NOKIA TAPER TALK SAC CAPITAL APPLE THIS DEALS Gas Home UK World Companies Markets Global Economy Lex Energy Financials Health Industrials Luxury 360 Media Retail & Consumer ▾ Tech February 25, 2013 6:06 pm Comment Sinopec acquires stake in Chesapeake asset By Ajay Makan in London Sinopec, the Chinese state-owned oil and gas group, will pay $1bn for a 50 per cent stake in Chesapeake Energy's Mississippi Lime oil and gasfield. REUTERS S Search News & Quotes olitics Tech Opinion Breakingviews Money Life Pictures Video Barra Energia for $2 Billion CNPC in Talks to Acquire Brazil's CNOOC closes $15.1 billion acquisition of Canada's Nexen UNCONVENTIONAL OIL & GAS MAGAZINE PAST ISSUES EXPLORATION & DEVELOPMENT HOME AS NAI GENERAL INTEREST Home » More General Interest » CNPC completes buy of stake off Mozambique CNPC completes buy of stake off Mozambique 07/29/2013 By OGJ editors DRILLING & PRODUCTIO FINANCIAL POST NEWS Sinopec to buy some Devon shale assets JIS$2.2B MARKETS ▾ 3:09 pm May 8, 2013 ASIA#65Government supports drive for resources... Angola (oil) In Zambia (copper) Congo DR (pretty much everything) South Africa (Iron ore, gold, diamonds) In Nigeria (oil, lots of it) In Ghana ('new kid on the oil block')#66Does Li Ka-Shing know something we don't? Sell China KI 百 PARKSHOP .UA 西城都荟 Park & Shop $4billion (July 2013) Shanghai OFC RMB6billion (Aug 2013) Guangzhou Metropolitan Plaza RMB 2.6 billion, (Aug 2013) HAIL Buy Europe WALES&WEST UTILITIES AVR UK: HKD 7.8 billion (July 2013) AVR Afvalverwerking: €944million (Jun 2013) O₂ ၁, 02: €850million (June 2013)#67Recap Picture in NL What 2 attracts 3 them to NL What 'pushes' them out Chinese FDI in NL on the rise. Miniscule compared to traditional foreign investors Chinese companies predominantly in sales, marketing Small operations (1-5 employees) Access to Dutch and proximate markets Technology, 'soft' innovation capabilities Infrastructure, English-speaking workforce, tax regime?, residence permit opportunities? Domestic competition Response - find new markets, upgrade capabilities, acquire more sophisticated technology Government support Industry upgrade - change development model Resource-seeking#68ECONOM FORUM Annual Meeting of the ECONOMIC New Champions 20 We support Chinese companies to Dalian, 11-13 Septemb "go out"! .LD MIC 新领军者年会 中国大 Annual Meeting of the LI KEQIANG#69Industry upgrade Firms improve technology, capabilities by acquiring high- end companies 2 Cartier Boost domestic consumption Firms acquire brands to differentiate products 3 4 SHE Reduced restrictions on FDI SMEs become bolder, better organised to venture abroad Cac Resource scarcity Demand for (new, clean?) energy.Active government support#70Thank you for your attention