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Business & Finance
CKGSB Knowledge - China Business and Economy

CKGSB Knowledge - China Business and Economy Spring 2017

CKGSB Knowledge is an English language business publication focused on China. It features original articles on business and economy in China, the evolution of “Made in China”, policy issues, the rise of Chinese companies, the emergence of Chinese multinationals, and foreign multinationals’ strategy and operations in China. It also features interviews with influential thought leaders and CEOs, both Chinese and global, on trending topics. CKGSB Knowledge provides a unique vantage point from which to discover the latest general and China-specific business trends. It also provides a matrix to understand how emerging markets are transforming the global business landscape.

Country:
United States
Language:
English
Publisher:
Cheung Kong Graduate School of Business
Frequency:
Quarterly
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4 Issues

in this issue

3 min.
the good of cross-border investment

In our commentary article in this issue of CKGSB Knowledge, we address a topic that has recently dominated the headlines in both Europe and the United States: Chinese outbound M&A (page 10). For much of the past few decades, China has been among the world’s principal recipients of foreign direct investment—indeed, FDI played a significant role in helping China to develop the powerful and dynamic economy it has today. This prosperity has, in turn, given Chinese companies the wherewithal to send investment back the other way, often in the form of cross-border mergers and acquisitions. But controversy has dogged many of these recent deals, and in the current climate of resurgent nationalism in the West, politics has, as politics does, bestowed a kind of mythic significance on some of these business deals. China’s…

2 min.
china data

The Matrix is Hiring According to research by Boston Consulting Group and AliResearch Institute, China’s digital economy is likely to create 415 million jobs by 2035 in fields such as IT and communication. The jobs will comprise nearly half of GDP, far exceeding jobs eliminated by technology Source: Boston Consulting Group Green Power! China plans to invest $361 billion into renewable energy by 2020, which the National Energy Administration says will create over 13 million jobs. The investment is part of a continuing push to end reliance on coal Source: Reuters Debt goes Domestic In a survey by Financial Times Confidential Research, 55.5% of Chinese households now hold some form of debt. Of all households in debt, 40.9% had mortgage debt, and 43.9% held credit card debt Source: Financial Times Euro Positive In 2016, Chinese investment in the EU surged…

1 min.
the new silk roads

China’s One Belt, One Road initiative is the fusion of two development schemes—the land-based Silk Road Economic Belt, and the 21st Century Maritime Silk Road. Together they comprise infrastructure projects aiming to improve trade between 65 countries containing 63% of the world’s population, more than 35% of global merchandise trade, and 30% of global GDP. To date about $150 billion in investment has been committed. A panoply of banks and funds are providing OBOR’s financial muscle OBOR Projects Rail • Moscow-Kazan High-Speed Railway• Khorgos-Aktau Railway• China-Uzbekistan-Kyrgyzstan Railway• China-Thailand Railway• Khorgos Gateway (rail shipping port) Energy • Russia Gas Pipeline• Central Asia Gas Pipeline• Central Asia Gas Pipeline – Line D Highway • Western Europe-Western China Expressway• China-Pakistan Highway Source: HK TDC, McKinsey & Company, People’s Daily Six Land Corridors – Approx. Annual Trade…

6 min.
the road to gung ho

Thirty years ago, there was such nationalist angst in the United States over Japanese buyouts of American companies that Hollywood saw room to even make a movie based on the theme. In Ron Howard’s 1986 comedy Gung Ho, the fictional Assan Motors Corporation swoops in to buy an idled auto plant in a desperate Pennsylvania company town. Despite the prospect of economic salvation, a culture clash ensues, pitting strict Japanese management against stubborn Midwestern workers, eventually threatening the futures of all involved. The film was a comedy and of course ended with cooperation prevailing and the plant being saved. There is an obvious parallel with the situation today with the US agonizing over Chinese investments in a remarkably similar way to how it worried about Japanese takeovers in the 1980s. In…

13 min.
retail, retold

Physical retail in China, malls especially, is facing huge challenges from without and within. E-commerce offers value and convenience, and old stores were poorly built. The future requires a reimagining of what shopping can be At the enormous Pacific Department Store on Shanghai’s Huaihai Road, barriers block the street entrances and windows are shuttered. The store, one of the largest on one of the city’s busiest shopping streets for nearly two decades closed in January, leaving a “Bye Bye Sale” banner still hanging above the entrance pillars. The shell of the store now sits incongruously opposite the K11 mall, which has been thriving ever since implementing a smart re-think of the shopping mall concept a couple of years ago. The lesson of the different fates of these two shopping centers is clear—adapt…

13 min.
dreaming of a greener world

Just a few years ago, China was a major obstacle to a global agreement on climate change. But the attitude of the government has changed, to the delight of all. That said, it will take more than good will to clean up In September last year, China finally ratified ambitious targets for the reduction of CO2 levels through the lessening of carbon intensity and improvements in environmental regulation. The targets, agreed at the Paris Climate Conference in 2015, marked a surprising turnaround for China, which, at the Copenhagen Summit in 2009, determinedly blocked environmental restraints on its developmental trajectory. Since that 2009 low point, the world has seen the emergence of the word ʻairpocalypse’ to describe the toxic miasma that now often enshrouds Chinese cities, an air pollution nightmare that has sharply…