{"id":10450,"date":"2022-06-29T07:00:52","date_gmt":"2022-06-29T07:00:52","guid":{"rendered":"https:\/\/focus.cbbc.org\/?p=10450"},"modified":"2025-04-23T09:39:47","modified_gmt":"2025-04-23T09:39:47","slug":"is-china-finished-with-foreign-investors","status":"publish","type":"post","link":"https:\/\/focus.cbbc.org\/is-china-finished-with-foreign-investors\/","title":{"rendered":"Is China Finished with Foreign Investors?"},"content":{"rendered":"

China is asking difficult questions of foreign investors and has seemingly changed how it approaches economic engagement with the wider world. British companies will need to pay even closer attention to what is coming out of Beijing if they are to stay ahead in China, cautions Joe Cash<\/strong><\/span><\/h2>\n

\u201cThe world is not waiting for China to resolve its Covid challenge\u2026 [foreign companies] move on, and China runs the risk of falling behind and losing the competitive advantage [it] had.\u201d So says Joerg Wuttke, President of the European Chamber of Commerce in China, who is just one of at least a dozen prominent businesspeople in China to have expressed concern at the country\u2019s about-face to foreign investors in the name of Covid. Indeed, while publicly adamant that they are \u2018in China, for China,\u2019 as so many executives in the market like to say, behind the scenes, multinational companies are beginning to get a bit tetchy.\u00a0<\/span><\/span><\/p>\n

Questions abound. Did MNCs get the wrong end of the stick? Is China finished with foreign investors, and have the tens of thousands of business people who\u2019ve been coming to China determined to cultivate the country\u2019s 1.4 billion consumers been reading the room wrong? For example, was the announcement of the \u2018Dual Circulation Strategy\u2019 in fact Beijing giving foreign investors notice that it planned to become self-sufficient rather than another opportunity for foreign firms to \u2018contribute to China\u2019s rise?\u2019 Some 30 years after opening its doors to the international business community, China now appears to be reconsidering the relationship.\u00a0<\/span><\/span><\/p>\n

This Policy Update aims to shed light on the numerous calculations that currently might be taking place in Zhongnanhai concerning the international business community and explain why it will not be business as usual once China does decide to reopen to the world.<\/span><\/p>\n

\"launchpad<\/a><\/p>\n

Background\u00a0<\/span><\/span><\/h4>\n

First, it is important to define how China views its place in the global economy and how, as a result, it engages with foreign firms.\u00a0<\/span><\/span><\/p>\n

Despite what some commentators have suggested, China is not about to become a larger, more tech-savvy North Korea. But the country is also not about to become a free-trade loving, rules obeying, Westward-leaning trade partner<\/a>, either. Instead, China will most likely up the ante in competing for economic dominance, underpinned by greater financialisation and promotion of Chinese law. It wants to be able to play by its own rules \u2014 and that will bring with it seismic changes to the global economy. Foreign firms may become far more dispensable, for a start.\u00a0<\/span><\/span><\/p>\n

What is more, China has been laying the foundations for such a shift for years, meaning that one should view more recent factors, such as Covid-19 and the war in Ukraine, as catalysts rather than causes in terms of the country\u2019s new coolness in the face of trade partners and foreign firms.<\/span><\/p>\n