China is taking over the world. Kirsten Levermore learns how – and why
Between 2000 and 2007, China’s outward foreign direct investment (FDI) rose 17-fold. During the global financial crisis, China’s FDI grew at an annual rate of 45%.
In Global Expansion: The Chinese Way, leading Chinese globalization experts from the China Europe International Business School (CEIBS), Katherine Xin, Yuan Ding, Weiru Chen, Klaus Meyer and Gao Wang, discuss the rise of China in the world economy, the merger and acquisition (M&A) strategies defining Chinese expansion, and some of the risks and rewards that have been found in two decades of aggressive globalization.
Proposing a three-stage model for globalization, the authors draw on a wealth of experience and research to examine the M&A and integration strategies that have built the second-largest economy on Earth.
Acquire. Integrate. Apply
The primary purpose of Chinese companies’ quick work across borders is to strengthen domestic business and China, the authors write. Noting how different this is from the West’s often less ostensibly patriotic function, Global Expansion hypothesizes that it is down to a different view of competition:
“…while most Western companies seek to exploit competitive advantages, achieve market growth and strive for synergies in global markets, Chinese enterprises aim to compensate for their competitive weaknesses and enhance their competitive advantages in the Chinese market.”
And with the support of the Chinese government with the Belt and Road initiative and the Third Plenary Session of the 11th Central Committee of December 1978, the partnership between government, companies and the home country keeps such purpose at the forefront.
Not a handbook, but a module
Such is one of many takeaways from Global Expansion.
It is worth noting, however, that the book is not a handbook to ‘investing like a Chinese corporation’. You will find no ‘helpful hints’ or ‘strategies to mimic’. What it is, however, is an in-depth economic and cultural examination of Chinese business practice in the rest of the world, richly set in context, without personal and political commentary, and featuring a plethora of case studies, including big names such as Wanda, Chervon, Haier Group and Lenovo Group.
Global Expansion’s five experienced, loquacious and informed authors mean that every element, every case study and every trend is deeply researched and carefully presented. This leaves the book with a neat and well-illustrated executive-education-like finish.
Cutting no corners, Global Expansion is in-depth and pores over the blueprints that are bringing Chinese industry to the four corners of the Earth, offering clues as to how you might spot the mammoths of tomorrow.
A must-read for policy-makers, strategists, investors and economic history fans alike.
— Kirsten Levermore is assistant editor of Dialogue
Global Expansion: The Chinese Way
Katherine Xin, Yuan Ding, Weiru Chen, Klaus Meyer & Gao Wang
Published by LID