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‘a Still Growing but More Complex China’: Current Opportunities and Challenges for Mncs in China

In: Business and Management

Submitted By bushrakomal
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‘A still growing but more complex China’: Current opportunities and challenges for MNCs in China

1. Introduction
2. Challenges for MNCs as they expand their footprint in the world’s second largest economy 3. Opportunities for MNCs to operate in China
4. Comments of CEOs and news articles relating to the topic
5. Conclusion and future suggestions for MNCs to successfully compete
References

‘A still growing but more complex China’: Current opportunities and challenges for MNCs in China

1. Introduction

An overview of China today

Relationship of China and world MNCs

‘A still growing but more complex China’

Impact of global financial crisis on the relationship

China in the ranking of MNCs wish-list

What does today’s China hold for MNCs

2

‘A still growing but more complex China’: Current opportunities and challenges for MNCs in China

2. Challenges for MNCs as they expand their footprint in the world’s second largest economy “Not ‘Cheap China’ any more: costs are soaring across China

Business
Challenges

Labor shortages; due to China’s aging problem
Wage inflation; country’s ageing population has changed

the cost equation abruptly
Conducting

Regulatory

successful

Challenges

Rise of trade protectionism
Local competitors are becoming more competitive

business in the world’s 2nd largest economy is increasingly

Regional

‘There is more than one China’

Differences

challenging
Rising
consumption

Selling to China’s middle-class isn’t always easy
Explosive growth in both desire and purchasing power

China’s middle class

Consumption patterns can change overnight

3

‘A still growing but more complex China’: Current opportunities and challenges for MNCs in China

3. Opportunities for MNCs to operate in China

Favorable tax treatment to foreign invested companies

VAT reforms are offering additional opportunities

There is still good reason to be in China for the

Western region of China is still competitive

world
Technology sector in China is attractive for MNCs

Chinese Govt. is encouraging to invest in Shared Services

4

‘A still growing but more complex China’: Current opportunities and challenges for MNCs in China

4. Future suggestions for MNCs to successfully compete

Reduce selling, general and admin expenses

Develop new growth patterns

Implement dual strategies

Finding new efficiencies in

Know the law and follow it

China
Don’t bend the rules

“Think global but act local”

Put more and more emphasis on innovation

5

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