Weekly Highlights of Global Investment | Issue 84,August 24,2024
Brief
China launched an anti-subsidy investigation into imports of dairy products from the European Union；The European Central Bank may cut rates in September；Dubai Seeks Chinese Investment; The European Union will impose steep tariffs on Chinese-made electric cars；Chinese investment in Vietnam surged 80 per cent; China's 144-hour visa-free transit policy has been extended to 37 ports and 54 countries; Japanese automakers face a potential crisis that could affect its global market; LG Electronics of South Korea has invested $10m in a Japanese artificial intelligence start-up; AMD of America will set up a research and development center in China; Hyundai Motor of South Korea has invested Rs 1.8 billion for a hydrogen fuel innovation centre; Toyota of Japan fuel cell research and development and production plant put into operation in Beijing; CHina’s BYD's foray into Pakistan will include a factory in Karachi; Schweppes in Britain to Invest $28M in Expanding Citrus Farming for Juice Production; Johnson Controls of America officially opens its global Manufacturing center.
Policy and Industry Dynamics
China launched an anti-subsidy investigation into imports of dairy products from the European Union
China's Ministry of Commerce (MOFCOM) announced on August 21 that it decided to initiate a countervailing investigation against imports of relevant dairy products originating from the European Union starting from August 21, 2024. The dairy products under investigation include fresh cheese and curd. The investigation will look at a total of 20 possible subsidies that the EU and its national governments may provide to the EU dairy industry.
The European Central Bank may cut rates in September
The increased risk of negative growth in the eurozone strengthened the case for the European Central Bank to cut interest rates in September, it was reported on August 22. Inflation in the euro zone rose to 2.6% in July, up slightly from 2.5% in June. The main reason is the energy base effect, which refers to the impact of changes in energy prices on economic indicators. But the ECB said energy price inflation should moderate in coming months, bringing overall Eurozone inflation closer to the central bank's 2 percent target. That helped the ECB cut interest rates in September.
India Begins Approving Chinese Investments
On August 22, India has started approving several investment proposals from Chinese companies in the electronics manufacturing sector. Among the approvals are Chinese electronics giant Luxshare, a vendor for Apple, and a joint venture between Bhagwati Products (Micromax) and Huaqin Technology, with the latter holding a minority stake. The approvals also include Taiwan-based firms with Hong Kong connections. This move reflects a significant policy shift by the government towards accepting Chinese investment despite ongoing geopolitical concerns.
Philippine Ambassador Promotes Renewable Energy Investments to Chinese investors
On August 22, during ASEAN-China Week in Shanxi, Ambassador Jaime FlorCruz encouraged Chinese investors to invest in the Philippines' renewable energy sector. The event, themed “Asean-China Comprehensive Strategic Partnership: Achieving Prosperity through Innovation,” was attended by government officials, diplomats, and business leaders. FlorCruz highlighted that the Philippines aims to have at least 35% of its power generation come from renewable energy by 2030, with a target of 50% by 2040.
Dubai Seeks Chinese Investment
On August 21, Dubai aims to strengthen its role as a gateway for Chinese investment in the Middle East. Mohammad Ali Rashed Lootah of Dubai Chambers highlighted the UAE's strategic position and infrastructure. Dubai remains a top destination for foreign direct investment and a major trade partner for China, with non-oil trade at $67.8 billion. The UAE and China are celebrating 40 years of diplomatic relations and aim to increase bilateral trade to $200 billion by 2030.
The European Union will impose steep tariffs on Chinese-made electric cars
The European Commission on August 20 issued a final ruling on China's electric vehicle anti-subsidy investigation, according to the EU sample of three Chinese car companies, BYD will be levied a 17% countervailable duty, Geely will be levied a 19.3% countervailable duty, SAIC will be levied a 36.3% countervailable duty. Other Chinese automakers that didn't respond to the sample but cooperated with the EU probe would be subject to a 21.3% duty, while others that didn't cooperate would be subject to a 36.3% duty.
According to the EU investigation procedure, after the commission publishes the draft final ruling and solicits the views of relevant stakeholders, it will submit the final ruling to the EU's 27 member states, which will vote on the final decision. The European Commission is due to make a final ruling on its anti-subsidy investigation into China's electric cars by November 4.
Chinese investment in Vietnam surged 80 per cent, Sunwonda sought investment opportunities
Since August 20, Hanoi has received a significant inflow of investment from China, with many international companies investing in sectors as diverse as technology, electronics and renewable energy. Sunwonda plans to set up a $300 million plant locally to produce electronic components, its general manager said.
In early August, within the framework of China's trade promotion program, the leaders of the Vietnamese city of Haiphong issued investment licenses for a series of projects worth nearly $200 million. This reflects the recent trend of Chinese investment pouring into Vietnam. Chinese investment in Vietnam surged nearly 80% to $4.5 billion in 2023, mainly in the tech, electronics and renewable energy sectors, statistics from Vietnam's Ministry of Planning and Investment show. Vietnam welcomes the positive investment trend in the high-tech sector. In the first half of 2024, China's capital investment in Vietnam ranked fourth.
China's 144-hour visa-free transit policy has been extended to 37 ports and 54 countries
The State Council Information Office of the People's Republic of China held a press conference on the theme of "Promoting high-quality Development" on August 19. Liu Haitao, deputy director of the National Immigration Administration, said that the National Immigration Administration has introduced more than 110 policies and measures to facilitate foreigners to come to China, and continued to optimize the policies of visa-free entry, visa-free transit and visa-free port, so as to promote the number of foreigners coming to China to increase. The 144-hour visa-free transit policy, which has become popular recently, has been extended to 37 ports and 54 countries.
Schlumberger (SLB) of America, the world's largest oilfield services company, is expanding in Russia
According to reports on August 17, America’s Schlumberger (SLB) is expanding in the Russian market. Since the conflict between Russia and Ukraine, its main Western rivals have pulled out. The company publicly pledged in July 2023 to stop "shipping products and technologies to Russia" from its global factories. Russian customs documents show that such imports slowed to a halt by early September after the ban was imposed. Despite the ongoing war, the Texas-based company has signed new contracts in Russia and hired hundreds of employees.
Japanese automakers face a potential crisis that could affect its global market
In July, when Chinese electric car maker BYD completed its Thai plant, Japan's Honda announced it would stop production at its Ayutthaya plant in 2025. Over the past four years, Honda's two factories in Thailand have produced fewer than 150,000 units a year and sold fewer than 100,000 units a year. Thailand has traditionally been a strategic priority for Japanese auto makers. The closure of Honda's Thai factory also sounded the alarm of the transformation of the Japanese auto industry chain. This also reveals the biggest potential crisis of Japanese auto manufacturers from the side, the slow transformation of intelligence and electrification has retreated from the Chinese market and began to spread to the global market.
China and Indonesia Strengthen Energy Sector Ties
On August 22, Mr. Xu Xin, chairman of the China Gas Industry Alliance, recently met with Madam Nadiya, the Economic Counselor of the Indonesian Embassy in China, to discuss the IG Indonesia 2024 exhibition. Key points included the invitation of Mr. Eko S.A. Cahyanto, the Secretary-General of Indonesia's Ministry of Industry, to the event, and the involvement of the Indonesian Industrial Gas Association as a co-organizer. The event will focus on LNG and hydrogen energy, aligning with Indonesia's green energy goals. The Indonesian Embassy will support the event by engaging relevant government departments and encouraging Chinese investment in Indonesia's energy sector. Both parties aim to strengthen the gas industry and economic ties between Indonesia and China.
Chinese Investment in Vietnam Soars 80%
On August 22, Chinese investment in Vietnam surged by nearly 80% in 2023, reaching $4.5 billion, with significant projects in technology, electronics, and renewable energy. Key investments include Sunwoda Group with a $300 million factory in Bac Giang and Runergy Group with a $440 million semiconductor project in Nghe An. Vietnam, has welcomed this trend, especially in high-tech sectors, seeing as China ranks fourth in in capital investment in the first half of 2024.
India Begins Approving Chinese Investments
On August 22, India has started approving several investment proposals from Chinese companies in the electronics manufacturing sector. Among the approvals are Chinese electronics giant Luxshare, a vendor for Apple, and a joint venture between Bhagwati Products (Micromax) and Huaqin Technology, with the latter holding a minority stake. The approvals also include Taiwan-based firms with Hong Kong connections. This move reflects a significant policy shift by the government towards accepting Chinese investment despite ongoing geopolitical concerns.
Philippine Ambassador Promotes Renewable Energy Investments to Chinese
On August 22, During ASEAN-China Week in Shanxi, Ambassador Jaime FlorCruz encouraged Chinese investors to invest in the Philippines' renewable energy sector. The event, themed “Asean-China Comprehensive Strategic Partnership: Achieving Prosperity through Innovation,” was attended by government officials, diplomats, and business leaders. FlorCruz highlighted that the Philippines aims to have at least 35% of its power generation come from renewable energy by 2030, with a target of 50% by 2040.
Indonesia and Chinese future investment plants
On August 21, the next president of Indonesia, Prabowo Subianto, will take office in October. His goal is to grow the GDP by three per cent, through the nickel industry. Most of Indonesia's refining facilities are located in industrial parks, mostly owned by Chinese companies. 89% of the country’s nickel industry, mostly semi-finished products, are exported to China. In other words, the domestic hi-tech industry is not benefiting much from nickel. Chinese companies, on the other hand, are in talks with potential investors to reduce their holdings in Indonesian nickel smelters as part of efforts to make their products eligible for US tax credits for electric vehicles.
Dubai Seeks Chinese Investment
On August 21, Dubai aims to strengthen its role as a gateway for Chinese investment in the Middle East. Mohammad Ali Rashed Lootah of Dubai Chambers highlighted the UAE's strategic position and infrastructure. Dubai remains a top destination for foreign direct investment and a major trade partner for China, with non-oil trade at $67.8 billion. The UAE and China are celebrating 40 years of diplomatic relations and aim to increase bilateral trade to $200 billion by 2030.
MNCs Global Investment
LG Electronics of South Korea has invested $10m in a Japanese artificial intelligence start-up
On August 22, South Korea's LG Electronics announced on Aug 22 that it will invest heavily in startups focused on artificial intelligence (AI) and deep tech. At the same time, the Company has committed to invest US $10 million in a newly established US $130 million "Alpha Intelligence Fund(AIF)" managed by SBVA, the early stage venture capital arm of Japan's SoftBank Group, and will act as a lead limited partner.
AMD of America will set up a research and development center in Taiwan, China
On August 22, the US chip giant AMD will set up a research and development center in Tainan city and Kaohsiung city, in cooperation with local universities and enterprises, will invite 33 Chinese Taiwan manufacturers to participate in research and development, as well as the commitment to improve the independent rate of components in Taiwan, China to help establish a supply chain in Taiwan, China, this plan will drive new investment of 15 billion yuan.
Hyundai Motor in South Korea has invested Rs 1.8 billion for a hydrogen fuel innovation centre
On August 21, Hyundai Motor India announced that it will invest 1.8 billion rupees (about $21.4 million) to establish a hydrogen fuel innovation center in the southern Indian state of Tamil Nadu. The construction of the facility is supported by the local government and is expected to be fully operational by 2026.
Decathlon of France to Invest €100M in India, Expanding to 190 Stores
On August 21, Global sports brand Decathlon has announced a €100 million investment in India over the next five years. This investment aims to expand Decathlon's retail presence from 127 to 190 stores across the country. The company also plans to enhance digital engagement and boost local manufacturing, reflecting India's significance in Decathlon’s global strategy. Beyond business growth, Decathlon is committed to fostering sports participation and sustainable development in India, aligning with its mission to "Move People Through the Wonders of Sport.”
Toyota’s fuel cell research and development and production plant put into operation in Beijing
On August 20, the new plant of Huafeng Fuel Cell Co., Ltd. and United Fuel Cell System Research and Development (Beijing) Co., Ltd. was officially put into operation in Beijing Economic and Technological Development Zone. This marks that the fuel cell project jointly promoted by Toyota Motor Corporation and local partners in China has officially entered a new stage. In order to contribute to the vision of carbon peak and carbon neutrality in China, through the localization efforts of new quality productivity, it will further accelerate the R&D and market investment speed of products suitable for the Chinese market, and help the popularization and application of hydrogen technology.
BYD's foray into Pakistan will include a factory in Karachi
On August 20, BYD announced plans to build a factory in Karachi, Pakistan, in partnership with a local manufacturer to gain a foothold in Pakistan's growing electric vehicle market. Byd has teamed up with the Mega Conglomerate Pvt, one of Pakistan's largest business groups. The agreement "goes beyond the dealer model they typically use in most markets." At the same time, BYD will cooperate with Hub Power Co, Pakistan's largest independent power producer. The subsidiary of Mega Motors formed a joint venture. The plant will be completed in the first half of 2026, the details of which are still being discussed. Byd will also set up showrooms in Karachi, Lahore and Islamabad, with sales starting in the fourth quarter of this year.
Schweppes of Britain to Invest $28M in Expanding Citrus Farming for Juice Production
On August 20, Schweppes Zimbabwe is investing $28 million in a large-scale citrus farming project to secure a reliable supply of oranges for its juice production, reducing dependence on external suppliers. The Zimbabwean government has allocated 4,000 hectares of land for this expansion, with Schweppes initially developing 700 hectares. This investment will boost production capacity, create jobs, and stimulate local economic growth, reinforcing Schweppes’ leading position in Zimbabwe's beverage market and enhancing operational efficiency.
Chint Instrument of China opened its second overseas factory in Kenya
On August 19, Chint Kenya Instrument Factory held the opening ceremony. This is the second overseas factory of Chint Instrument, covering an area of 4,000 square meters, with local employees accounting for about 90%. It is equipped with various functional laboratories such as product performance testing, environmental impact testing and electromagnetic compatibility testing. The annual production capacity of electric energy meters is over 400,000, and the product localization rate will reach 30%-40%. The completion of the plant is a milestone in Chint's global regional localization, which will further enhance Chint's global competitiveness in the field of energy measurement and management, and contribute to the energy infrastructure construction in Kenya and the whole African region.
DISCO of Japan wants to enter India's semiconductor market
On August 19, DISCO, a Japanese manufacturer of semiconductor manufacturing equipment, will set up a local branch in India to handle sales and technical support services as early as September, it was announced on August 17. India is in the process of attracting semiconductor companies to set up factories in the country under a government-led initiative, and DISCO plans to support semiconductor manufacturers setting up factories in India. DISCO, a global giant in back-end manufacturing equipment that provides "cutters" that cut silicon wafers into semiconductor chips and "grinders" that slice thin wafers, decided to enter India because it thought demand would expand there.
HILTON of America opens its 700th hotel in Greater China
On August 17, Conrad Chongqing, Hilton's 700th hotel in Greater China, officially opened on August 16, marking another milestone in the group's development in China. The opening of Conrad Chongqing marks the first time Hilton Group luxury hotel brand has entered the mountain city of Chongqing and will further consolidate Hilton Group's development in the western China market. Hilton also announced the addition of a Western Division in China, which manages and supports its hotels in 11 provinces, autonomous regions and municipalities, including Chongqing, Sichuan, Gansu, Ningxia, Qinghai, Xinjiang, Tibet, Yunnan, Guizhou, Guangxi and Hunan.
America Fedex active in opening its first European life Sciences Center in the Netherlands
On August 16, America's fedex opened its first European life sciences center in Welderhoven, the Netherlands. This is fedex's sixth life sciences center, following Memphis in the United States, Mumbai in India, Singapore, Seoul in South Korea, and Tokyo in Japan, to provide customers with fast and secure logistics services.
Johnson Controls of America officially opens its global Manufacturing center
On August 15, the unveiling ceremony of Johnson Controls York M multistage centrifugal compressor global manufacturing center was held in Wuxi factory. Currently one of Johnson Controls' largest R&D centers for heating, ventilation and air conditioning systems, as well as industrial refrigeration and heat pump solutions, the Wuxi site has reached a new milestone with the official opening of the global manufacturing Center for M multistage centrifugal compressors. In recent years, Johnson Controls has continued to deepen its localization strategy in China, and in key product areas, such as the core parts of M multistage centrifugal compressors, most of them have been purchased and produced in China.
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