Chinese Multinationals, Stock Markets, Banks, Oil and hightech players: The biggest in the world?

Free Market News

Is it China’s turn to produce giant multinational firms? China’s largest companies are mostly state run and will have to be privatized before they can straddle the world eye-to-eye with European and American giants. Chances are Chinese “privatization” will produce hybrid firms, with characteristics of both state and private enterprises.

However, this blending has produced European powerhouses such as Airbus – which has only survived with regular injections of state capital, yet has proved a surprisingly effective competitor to Boeing.
Of course there are plenty of free-market thinkers who would be quick to maintain that Boeing itself is something of a state-run franchise given that a good deal of its revenue is derived from products produced under contract to the U.S. military.

In fact, in today’s world, it would be hard to find a corporate giant which doesn’t have plenty of government support. The hybrid structure produces clumsy companies with generous safety nets of public and private resources that allow them to overcome, in large part, even the most disastrous decision-making. In this environment, Chinese multinationals will not be significantly disadvantaged; if privatization goes far enough, Chinese multinationals may even surprise, by proving more flexible and entrepreneurial than their American and European competition.

In two new books, (1. China's global reach: markets, multinationals, globalization; 2. China and the new world order: how entrepreneurship, globalization, and borderless business reshape China and world), leading strategist and author George Zhibin Gu profiles the coming surge of Chinese multinationals with a focus on companies he believes are in line for global dominance. One such is the gigantic energy concern State Grid, which holds the energy monopoly for the country. Then there is China National Petroleum Company, already ranked 52nd largest in the world by Forbes. China Mobile has access to 340 million cellular phone consumers, and Shanghai-based BaoSteel is now participating in a $2 billion joint venture in Brazil.

The two books also point out that some of China’s biggest multinational firms are yet to be built – so long as the process of privatization includes consolidation. Says Zhibin Gu, “If China’s consumer electronics and home-appliance makers, now numbering 1,300, can be reduced to half a dozen companies, the resulting ones will be among the biggest multinationals.”

New Book : China’s global reach : markets, multinationals, and globalization

Author : George Zhibin Gu ;

Afterword by Andre Gunder Frank

Contents of book

Introduction Growing Up in China Going International Returning Home This Small Book

Acknowledgements

General Notes

Part I China as a New Global Theater

Chapter 1 Ambitions of the Foreign Multinationals in China Today’s Versions of Columbus and Magellan Why Are They Here ? Why China ? One Big Factory-Market More Sectors, More Players The Business of China Is Business !

Chapter 2 Creation of a Global Manufacturing Center Stock Market With No Charter Arrival of Indian Companies One U.S. Banker’s Discovery Tens of Millions of New Businesspeople Rapid Development Driven by Shortages Business Elements, Strong and Weak A Crowded Market Convenient Settings Future Trends

Chapter 3 All Players Are Important Competing International Players International Banks International Listings Consumer Views

Chapter 4 Learning-a Big Industry Demand for Education A Top School International Involvement

Chapter 5 The Officials’ Global Reach Officials Lead the Way Guangdong versus Inland Abolishing Bureaucratic Tricks International First New York Versus Beijing

Chapter 6 “Capital Is Not Enough” No Shortcuts Volkswagen Versus Beijing Jeep “Capital Is Not Enough” Ericsson’s Seven Mistakes Bashing Carrefour

Chapter 7 “Why Is China Still a Developing Nation ?” Hiring by Foreign Multinationals New Era of Global Job Transfers Job Worries Around the World Hiring by Chinese Players Global Job Transfers : China Versus India

Part II China’s New International Experience

Chapter 8 Price, Price, Price A Chinese Edge GE in China Japan’s Global Efforts Cisco Versus Huawei Microsoft in China Global Price Reductions

Chapter 9 When Can Chinese Companies Become Global ? Weakness at Home Foreign Observations Low Benefits for China State Banks : “The Troublemakers” A Long Way to Go

Chapter 10 China’s Global Reach : Alternate Strategies International Efforts Bringing International Business In More Exchanges and Widening Channels Buying Into International Markets Creating More Partnerships Foreign Acquisitions

Part III China’s Reform at Home : The Unfinished Task

Chapter 11 Problems Outpacing Solutions State Assets and Death on the Nile “Two Pockets of the Same Jacket” Lack of Weapons and True Owners

Chapter 12 How Can a Man Still Wear Baby Clothes ? Factories and Highways Are Not Everything Credit Crisis and Banking Problems The Richest Man in Shanghai

Chapter 13 Crises and the Forward Movement of the State Sector Rapid Changes in the Managerial Class Long Live Competition ! Reform Difficulties Painful Layoffs Government Trimming

Chapter 14 When Can China Achieve Meaningful Restructuring ? A Saturated Market The CEO in China and Elsewhere Who Is Responsible for Wealth Creation ? Buying Parties Ready ? Need for Greater Determination

Chapter 15 Employment and Other Traps Jobs, Personal Freedoms, and Opportunities Lives of the Migrants Employment Difficulties for Other Groups Death of a College Graduate

Chapter 16 Other Uncertainties for the Business World Tails Everywhere Lucky International Players “The Red Building”

Part IV Globalization in Light of History

Chapter 17 An Unbroken Circle ? The British Isles as a Global Center China’s Missed Opportunities The U.S. Way : Dumping Losers Expansion and Wealth Creation, Past and Present

Chapter 18 A New Global Trend : Mega-Companies and Global Expansion Bigger and Bigger Multinationals First Strategy : A Strong Home Base Second Strategy : Reducing Players and Creating a New Form of Dominance Third Strategy : A True Global Reach China’s Participation in the World Economy

Chapter 19 More on the Circle Who Has Affected Globalization the Most ? First Factor : Japan’s Global Reach and Retreat What Is Going On in Tokyo ? South Korea : Glories and Bubbles Second Factor : Asia’s Financial Crisis Third Factor : The World Trade Organization Unexpected Developments

Chapter 20 The World Watches : How Does China Achieve Sustained Growth ? A Great Paradox Effective Government, Different Role A New Model Getting Out of the Box China’s Best Choice : A New Society A Great Convergence Laws

About the Author

George Zhibin Gu, a native of Xian, obtained education at Nanjing University in China and Vanderbilt University and the University of Michigan in the United States. He holds two MS degrees and a Ph.D. from the University of Michigan.

Since 1990, he has been an investment banker and business consultant. He has worked for the last 15 years in the investment world with a focus on China. His work focuses on helping international businesses to invest in China and the Chinese companies to expand overseas. He has worked for Prudential Securities, Lazard, and State Street Bank, among others. He generally covers mergers and acquisitions, venture capital, business expansion and restructuring.

Also, he is a commentator on a changing China in relation to global development. His articles or columns have appeared in Asia Times, Beijing Review, The Seoul Times, Financial Sense, Gurus Online, Money Week, Online Opinion, Asia Venture Capital Journal, and Sinomania, among others.

He is the author of three additional books :

1. 3. China and the New World Order : How entrepreneurship, globalization and borderless business are reshpaing and the world (Fultus, 2006),

2. China Beyond Deng-Reforms in the PRC (McFarland, 1991) ;

3. Made in China - Business and National Players and Challengers in the 21st Century (English edition forthcoming, 2007, Portuguese edition, Centro Atlantico, 2005).

He is also a member of World Association of International Studies hosted at Stanford University. He now resides in Guangdong, China.