Transparency key to bilateral investment: panel
The direct investment relationship between China and the United States is expected to forge ahead in 2016 despite economic headwinds, but business experts would like to see more transparency.
Those were some of the observations by panelists in a discussion— Chinese Investors in the US: Partners or Competitors? — organized by the China General Chamber of Commerce - USA (CGCC) at the Waldorf Astoria New York hotel.
The CGCC also released a white paper on Chinese investment in the US on Tuesday.
Ni Pin, president of Wanxiang America, the US subsidiary of Wanxiang Group, the largest auto parts manufacturer in China, said that Chinese companies and their US counterparts can be partners and competitors in the US, during his keynote speech.
and competition are trends that expand across industries and country boundaries, said Xiao Yuqiang, chairman of the US Management Committee of the Industrial and Commercial Bank of China, who is part of the panel.
“China and the US need to work toward a more transparent regulatory environment to decrease arbitrage,” said Xiao.
Liu Mingwei, an associate professor at the School of Management and Labor Relations at Rutgers University, said there are many partnership opportunities for American and Chinese companies.
“The localization of management for Chinese companies in the US is quite high,” Liu said. “Most Chinese companies are aware of the domestic differences, so [they] have high awareness of adhering to local rules and management styles.
“In the long term, with the growth and development of Chinese companies, there might be more challenges or competition in the eye of American companies, like the solar panel industry,” Liu said.
“Competition or cooperation is really a function of a few variables, like the type or structure of a transaction and whether it’s a competitive play or not,” said Mitchell Silk, a partner with global law firm Allen & Overy LLP. “One of the things to also look at is the strategy of an investor.”
Xiao, Silk and Liu were joined by Li Ji, an associate professor at Rutgers Law School; Zhang Jun, vice-chairman of the CGCC and general manager of the New York branch of China Construction Bank; and Alexandra Bryant, a managing director at global commercial real estate firm Jones Lang LaSalle.
The report concludes that the United States is still a major overseas investment center for Chinese companies. But US government regulation continues to concern Chinese investors, as do reviews by the Committee on Foreign Investment in the United States (CFIUS) and the depreciation of the yuan.
On Tuesday, the International Monetary Fund cut its global growth forecasts for the third time in less than a year, citing a sharp slowdown in China.
Xu Chen, chairman of China General Chamber of Commerce USA, launches 2015 White Paper on Chinese investment in the US on Tuesday in New York.