4 Reasons Chinese Companies Ipo in America

The entrepreneurs are opening their companies away from China which means China is losing all that revenue. Other places seem to have less restrictions as well as more

Entering an untapped international market can strengthen a business tremendously—but what if the costs outweigh the benefits for the market itself? China has long been an important player on the global stage, but recent advances in manufacturing, natural resources, and energy production have catapulted the expansive country to the forefront of international trade. Currently the world’s fastest growing major economy, China is set to eclipse the United States as the world’s largest economy by 2016. Among various domestic and international plays, one of China’s most fascinating uses of its

Joint ventures (JV) are a popular method of foreign market entry because they theoretically provide a way to join complementary skills and know-how, as well as a way for the foreign firm to gain an insider’s perspective on the foreign market. Since China began its market opening in 1978, joint ventures have been the most commonly used form of foreign direct investment (FDI), with about 70% of FDI in China in the 1980s and 1990s taking the form of joint ventures (Qui, 2005, p. 47). The Chinese company, as well as the foreign investor, has since 1978 been drawn to the joint venture form. Walsh, Wang & Xin (1999) note that from the Chinese

Internet censorship and the requirement of self-censorship not only harm the economy inside China, but also are negatively affecting China in aspects of international commercial trade, even as globalization becomes the trend of today’s world. Chinese Internet censorship is applied to both directions; not only blocks Chinese Internet users’ access to certain foreign websites, but also prevents foreigners from knowing the truth about China through refusal of releasing reliable information. So when foreign companies want to enter the Chinese market, they face a serious question: “How do you assess an investment opportunity if no reliable information about social tensions, corruption or

Our research over the past five years into the battles between multinationals and local Chinese companies reveals that while market dominance by local champions is far from universal, it’s becoming ever more frequent. In industries as different as beer brewing, mobile-phone manufacturing and laundry-detergent production, Chinese companies — often seeming to appear from nowhere — are forcing multinationals to rethink their strategies and their hopes for explosive growth in the China market.

In fact, besides the three companies (Alibaba, Tencent, and Huawei) stated above, only Xiaomi, a smartphone developing company was able to go out of China in 2015. The lack of companies able to develop outside of China may imply a monopoly inside of China is at play as well as other countries are rejecting companies from China to enter to confront its policies. Even though the result of monopolies interfering the economy is minimized by the Chinese government because of price controlling is in the hands of the government, the cost of companies not being able to globalize impacts Chinese economy greatly. For example, as the market in China saturates, other countries’ markets become critical for companies to

The company initially entered into the Chinese market through licensing. Having gained sufficient local knowledge, it wanted to capture further the growing market with a new strategy which would be a direct involvement for which it could consider exporting and agencies. These would not allow it to form strong customer relationships. Cummins Inc. could also consider opening a Representative Office or a R&D Consortia but it wouldn’t give them access to the Chinese market. Another option for it is to set up a wholly foreign owned enterprise which would require very high investments and intense market study. Finally, Sino-US Joint Venture was the best option for them as it not only allowed them to enter the market fully but also to share the costs and risks with its Venture partner.

China’s recent rapid economic growth has astounded countries around the world, including the U.S. Domestic policies that improved incentives for economic competitiveness were one of the main reasons that China was so successful in increasing its Gross Domestic Product (GDP). “The combination of Chinese land and labor with the capital and expertise of Taiwan and Hong Kong industrialists provided a particularly important boost to exports and employment during the first decade of reform.” China attracted investments from multi-national corporations, which further contributed to China’s revival as a great trading nation.

It’s a trend that the Chinese government increasingly open market to foreign investors by reducing the barriers of entry. Recently, the State Council of China has altered the foreign investment policies, encouraged and supported the foreign investment on the service sector, especially the labour intensive but environmental friendly business in low developed central or western China (Chen & Liang, 2010). The government has also permitted the foreign investors to set up partnership business with local firms (Cao & Tai, 2009) rather than formerly approved options of joint venture and wholly owned. On the other hand, the current government and communist party are working to ease the social inequality. The minimum wage and annual income protection have been approved and increased in China at present (Wang et.al., 2009). Also, they have promoted the establishment of government-led labour union in major foreign business and expect to require all of them to set up in later (Kahn, 2006), which aim to create official-approved labour protection chapter and collective bargaining in foreign firms.

The government of china is very keen to encourage foreign investors, because foreign companies are regarded as relatively good corporate

With China emerging as a global power in business within the last decade, knowing about doing business in China has become more important than ever. There are both many advantanges and challenges with doing business in China in this modern era, and understanding both sides of this coin is the key to being successful in China. Some aspects to keep in mind include the cultural barrier, the price of the work force in China compared to the United States, and have the “made in China” brand be accepted back in the United States.

Foreign companies are always looking for a new country to plant a flag and expand their global market place. One of the ways that they do this in the business world is through a process called cross listing. This practice allows a company owned and operated in Country A to list their company in Country B’ s financial trading exchange. Some have argued that introduction of Sarbanes-Oxley (SOX) and the ongoing plans of convergence between US GAAP and IFRS have decreased the need for cross listing. While there is a difference of opinion as to

U.S firms need to understand certain types of the Asian market such as employment relationships and the different kinds of cultures. The host country factors included the government’s restrictions on foreign direct investment (FDI), lower protections of intellectual property and the cost of land. The barriers for internationalization may impact a

The London Stock Exchange lists the FTSE 100 which is a share index of stocks of 100 companies showing the highest market capitalisation. This will be completed by discussing the movement of the company’s share during the time period. The companies will also be compared to the movement of the shares against each other, against FTSE 100 and against its industry sector. The records and comparisons will be all in context of Stock Market Efficiency. Stock Market allows a company to be aware of the trade with shares and finance which is at an agreeable price. Two of the companies chosen to

In the 1990’s, there was around 100,000 state owned enterprises (SOE) in China and over half of them were losing money. Since 1992, most of the SOEs were given freedom to reform and extensive new investment was required for the action. IPO is one of the effective channels to raise capital in the market. Beside the Shanghai Stock Exchange and the Shenzhen Stock Exchange, SOE also sought listing out of the PRC and Hong Kong became their first destination.