Foreign investment environment of the development

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Environment for foreign investment Countermeasures for the development of national industries

Abstract: Foreign direct investment as the internationalization of production and the further deepening of international division of labor is an important way of becoming one of the world's major economic power on the world economy and society more and more profound impact . Since the reform and opening up of China in attracting foreign investment has increased, the entry of foreign capital both national industry of China has played a catalytic role, but also shows the impact of national industries and protect the healthy and rapid development of China's national industry, it is extremely important. This paper analyzes the foreign influence on our national industry, proposed to improve the development environment, build a market order of fair competition, the implementation of brand strategy, protection of national brands, and strengthen management of foreign capital to reinvest profits and to develop our ability to develop independent technology company and so promote the development of national industry. Keywords: foreign; national industry; countermeasures With the opening of the development, China's economic growth is accelerating, since 1993, China has become the world after the United States on foreign investment than any other country, the world's largest 500 companies in the Most invest in China. A country to become an economic power, it must be large to attract foreign investment and, of course, to attract foreign investment to bring global capital to use their own national industrial purposes, only to become a truly national industry and a strong sense of power. However, our utilization of foreign investment in foreign capital utilization, while also significantly, to China's national industry has brought great pressure of competition. First, use of foreign investment impact on the national industry (a) of the positive aspects of reform and opening up, foreign capital, technology and management inputs, eased the capital of China's enterprises tension, lack of technology, management, backward, rigid conflict management mechanism has become indispensable for the development of China's economic and effective way. Foreign Investment to upgrade the industrial structure of national industry and product upgrading, to promote improved management of national enterprises, and promote the development of central and western regions as well as China's economy and world economic integration, so that a large number of enterprises gradually to normal operation in accordance with international practice track, and promote China's economic integration with the world economy. In this favorable preconditions, national industry has made great progress, and a number of national enterprises and a large number of well-known regional brand names, brands and international brands in China. In the appliance industry, this advantage is more obvious, such as In the automotive industry, China has also appeared in December 2004, Lenovo Group, announced in Beijing to 1.25 billion acquisition of IBM's global PC business, which makes it an annual income of billions of dollars in the world's third largest PC vendor. (B) the negative impact when the continuous development of national industry, we should see that in the Chinese market gradually opening up, more national industry is facing strong pressure from foreign-funded enterprises in the began to shrink under fierce competition, loss of vitality, some mergers and acquisitions by foreign companies is the integration in the future gradually being squeezed out of the market. It is obvious that China's national industry, to varying degrees by the threat of foreign control. Industry control: the main body of foreign direct investment - the way multinational corporations through mergers and acquisitions, China's national enterprises, the massive demand, the acquisition is completed, there are usually two approaches, one is the termination of business operations, to eliminate competitors The purpose of the domestic market share achieved; there is a merger of the companies is to shift processing units under their own company to become multinational corporations on a global production chain links, no knowledge and core technologies. When the acquisition of a certain size, the entire industry will be controlled. Such as the early 80s, the brand-name soap factory in Guangzhou shampoo But the joint venture, P & G to idle, but a billion dollars in advertising into marketing efforts by the United States In early 2003, ST duckling issued a proclamation ST duckling's restructuring plan adopted by the shareholders, the company registered name from , stumbled in the stock market 4 years after the former majority shareholder, Shandong Electric duckling ducklings leave the stock market became the first home appliance business. Was awarded Sino appliances from retail monitoring information shows that most high-end washing machine market share occupied by international brands, including domestic ducks, including the declining share of leading brands. And Market control: the level of market share between the survival of an enterprise. Foreign holding company with its own advantages, the use of a variety of means and national enterprises compete for market share in China, some industries even reached the point of monopoly. Microsoft's operating system share 95% of the Chinese market; Kodak, Panasonic, accounting for 75% of photosensitive materials market; Cisco switch market accounted for 2 / 3, telecom hubs, switches and routers accounted for 60%; Intel's share of China micro-computer, PC 70% of the marketplace; Motorola, Nokia and Ericsson mobile phone market share of 70%; Coca-Cola beverage market share of nearly 70%; meters of its meters, Bridgestone, good communication accounted for 70% of the Chinese tire market; foreign beverage manufacturing, fur manufacturing, instrumentation manufacturing, flexible manufacturing, textile and garment industry, culture, education sporting goods manufacturing value-added share of over 50%; furniture industry, chemical industry, plastics industry, food industry more than 40% ; large supermarkets control surfaces up to 80%. Brand control: We all know the soul of the brand as a business, a very important position, while China's national brands often rushed International was squeezed out on the road, of which also have their own reasons external to the control of foreign direct investment which brand is the most important external factors, they are registered in China by well-known brands, such as dumping and brand alternative means of causing great harm to our brand. For example, in color film industry, and Second, the impact of China's national industry by foreign investors because of (a) of the loopholes in the legal aspects of foreign direct investment on market access requirements are not clear, so the case of foreign investment will inevitably expose the loopholes, so that some foreign investors take advantage of, so that the restrictions on foreign real lack of standards and restrictions for foreign investors to invest in creating conditions to avoid. In some of the same lack of continuity on the approval link, so dependent on foreign investment approval of a department or individual leaders of the moment directions, lost foreign policy continuity and transparency. In addition, China in anti-trust and unfair competition law, there is still lacking, it will not be conducive to China's foreign acquisitions of companies, regulation of monopoly markets, is not conducive to China's establishment of a fair competitive market environment. (B) of domestic funds to attract foreign capital utilized solve a large extent the situation of shortage of domestic funds, to better stimulate the development of national industries. At the same time, our country has a large amount of idle funds in 2006, savings deposits of urban residents amounted to 16.6617 trillion yuan, up 13.3% over the previous year, such a huge idle funds, if translated into investment, it will greatly ease China's current lack of economic development funds. Therefore, to make good use of foreign capital within the capital first, to prevent excessive dependence on foreign capital. (C) the advantages of foreign investment for its development of national industries to seize the weakness of the early development of national industries generally facing difficulties, such as poorly managed and does not meet the requirements of market economy; shortage of funds, the debt burden; technological backwardness development of a lack of stamina; even in the beginning of the establishment of private enterprises due to its advantages in the short term flexibility to adapt to the rapid development of the market, but its development has a certain scale, the limited management of the defect, is also facing a shortage of funds, backward management, technological obsolescence and a series of difficulties. And not only has foreign capital, technology and management advantages, and investment in China can also enjoy tax
next preferential policies and macro-policy support, so in this context, a number of poor management, endangered bankrupt enterprises to foreign acquisitions spotted this path,[link widoczny dla zalogowanych], in order to survive, but it took such a road have to pay a price, for example, control of the company. Danone funding, such as law Robust M & A Group, holding 93%, Robust control group lost their rights and the right to operate fully in operation subject to Danone, Danone did not understand do not understand the Chinese market Chinese employees, resulting in deterioration in business conditions, market share decreased year by year, in 2006, a multi-billion loss, the market almost out of control. Third, foreign investment and development of the contradiction between the national industry (a) of the conflict in the resource utilization of foreign direct investment into the host country one of the purposes is to use the host's resources ( particularly scarce resource), so foreign direct investment and national industries in the contradiction between use of resources mainly as competition for scarce resources of the host country. That scarce resources mentioned four aspects: first is the competition for human resources of host countries. Some foreign-invested enterprises on the one hand as bait from a large number of host countries with high salaries to recruit highly qualified personnel, on the other hand the reduction of the company's non-skilled labor, thereby further streamlining the working staff of the enterprise, so that the quality of internal staff to achieve the best structure. The second aspect is the competition for the host country technological achievements, because a number of local enterprises lack capital and advanced management techniques, may already have resulted in a number of important technical invention or patent can not be used in the production and thus create high profits, have to rely on and use of foreign direct investment to develop these important technological achievements, these techniques often can only be sold to foreign inventions or patents, or even the entire enterprise by foreign mergers. The third aspect is the host country, competition for natural resources, such as some foreign-funded enterprises in view of their home countries for a lack of natural resources and natural resources will be shipped back to the host country, resulting in the host country interests. The fourth aspect is the host country competition for intangible assets such as brand names, because some policies and laws on the host country is not perfect, foreign drilling these vulnerabilities, so that some already have a certain market share, the brand owned by own, or by way of merger direct access to some of the intangible assets of ownership. (B) the contradiction between the domestic market share Generally speaking, the higher the degree of market competition, resource allocation and utilization efficiency is higher. However, corporate profits and industry size are related. Capital profit motive to promote the development of foreign-invested enterprises to expand their scale exist and enhance the tendency of industrial concentration. A single of a specific market, expansion of the size enterprises with foreign investment enterprises will produce squeezing effect on the host country, will also appear more serious squeeze the host country industry, especially the phenomenon of infant industries. (C) changes in the external policy environment Normally, the entry of foreign-invested enterprises can promote changes in the host system, because it was originally in the context of no external disturbances to develop an external economy to adapt to the requirements of proposed legislation, which may in tax, accounting, investment and other areas to promote the establishment and improvement of legislation. But in terms of development in the host country, foreign investment in the supply of urgently expect the stage, tax, financial, investment and other areas of policy and legal development of foreign-funded enterprises will be inclined, and as such, national companies will not enjoy as This preferential treatment and are obstacles to development, and reduction in competitiveness, being squeezed. Fourth, use of foreign investment under the premise of the development of national industry, a coordinated response (a) to strengthen legal construction, improve the environment for development and establishment of fair competition in the market order is the legal economy market economy. Assessment of state-owned assets, brand strategy, foreign-controlled enterprises and the monopolization of the market are required by law to regulate. To this end, shall establish rules and regulations relating to property transactions, making property rights trading market, the legal system; improve the trademark law, to protect the national brand; establish relevant anti-monopoly and anti-unfair competition law, in order to maintain a fair competitive environment. At the same time, drawing on international experience, China should further improve management of the existing foreign investment legislation, restrictive foreign direct investment in specific provisions, and thus foreign direct investment into the industry's conduct and operations of law. For the higher than in their country's unreasonable for the privilege, for enterprise development and create conditions for fair competition. (B) the implementation of brand strategy, create a corporate culture, protection of national brand name brand price of shares is easy to produce two undesirable consequences, namely the host brand was replaced by foreign or joint venture companies need after the end of the host country paid a heavy price to pay to recover. Therefore, in joint venture negotiations, we must adhere to the ownership of national brand, a joint venture for a fee to use. Should be used in many ways, the use of joint ventures, the development of the host brand, you can use co-branded approach, you can also use different sales channels using different brands of methods. For the construction of enterprise culture, many Chinese enterprises have paid insufficient attention to often neglected the accumulation of corporate culture, a direct impact on the brand image of national industry, thus killing consumer confidence, loss of their own products in the market. China's national industry should focus on strengthening the corporate culture and build a brand that consumers trust to create a corporate brand's intangible assets. (C) the training of enterprise technology development capability independent foreign direct investment in China's basic idea is the industry to get rid of dependence on foreign capital, according to their own growing their own development ideas. Currently, many foreign investors are just as a host plant, while some of the research institutions located in the home country, which is very conducive to the development of joint ventures, domestic enterprises, foreign-funded enterprises will be gradually reduced to accessories. From the current market, the foreign-funded enterprises have been part of the scientific establishment in the host country, but the gold content of which is to be investigated, the ratio is also very limited. Therefore, domestic enterprises should be through joint ventures to achieve the real purpose of the joint venture, to learn foreign advanced technology and production capacity to gradually grow and develop. Make good use of foreign capital, more need to strengthen the country's own national research and innovation capacity of enterprises to enhance their ability to expand the market to gradually reduce dependence on foreign capital. (D) strengthen management of foreign profits reinvested in the host country some foreign factories, but through an internal transfer price will be profit-shifting back to the home country, does not meet the original intention of the host country to attract foreign investment initially. Therefore, I believe that the host country for foreign direct investment profits should be the transfer of appropriate interventions, for example, may provide a certain proportion of re-investment for host countries to ensure that the host can be part of the profits to the company's continued development and avoid becoming foreign subsidiary factory situation. References: [1] Li Xiaomei. Utilization of foreign investment and protection of national industries and Strategy contradictions [J]. Foreign Trade, 2007, (9). [2] Yao Kuang Yee. to attract foreign investment laws to protect national industries Thinking [J]. CHONGQING INSTITUTE OF TECHNOLOGY, 2007, (5). [3] SOCIETY FOR SCIENTIFIC Yao Shun first. On the introduction of foreign investment and the protection and development of China's national industry [ ,],[[5] Han Shanhui. [J]. Market Modernization, 2005, (12). paper web online [link widoczny dla zalogowanych] </ A

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