Multinationals, Globalisation and Indigenous Firms in China

This book considers the impact of multinational companies in China on the Chinese economy and on indigenous firms in China. It examines the strategies of multinationals, showing how the global business environment has undergone profound changes since the early 1990s, driven by liberalisation of trade and capital flows, rapid advances in information technology, and the trend towards privatisation and deregulation, which have in turn led to an explosion of merger and acquisitions activity and consequent unprecedented degrees of concentration in many industries at a global level. The book argues that this high level of concentration at the global level allows large economies of scale and scope in activities such as branding, technology investment and systems integration; and it argues that the pressure for consolidation 'œcascades'� down the firms' supply chains, affecting key partners and the structure of local markets. It discusses the effects of these developments on value chain structures in China,showing how, as China's integration into the global economy increases, these new, globalised value chain structures are becoming the established norm across the Chinese economy. It discusses the effects of these developments for local Chinese firms, where the strategy of 'œcatch-up'� has recently been a primary goal, demonstrating how difficult it is for Chinese firms to achieve 'œcatch-up'� when the competitors they are chasing are themselves moving forward and evolving so fast. The book includes detailed case studies of Boeing, Wal-Mart and Coco-Cola, considering their activities both at the global level and within China, and case studies of the sectors in which these forms operate in China. The book's profoundly important conclusions concerning the impact of multinationals on the local economy and on indigenous firms are applicable to other developing economies as well as to China.