China's net overseas investment hit US$21.16 billion in 2006, with an
annual average growth rate of 60 percent over the past five years, according to
a newly issued government statistical gazette.
The gazette quoted an expert from the National Bureau of Statistics as saying
that overseas investment by Chinese enterprises has developed from setting up
offices and opening "window" branches only to building factories, purchasing and
acquisition, equity swapping, listing on overseas stock markets, establishing
strategic cooperation and other patterns.
A prominent feature of overseas investment is the increasing cases of
purchasing and acquisition, which accounted for some 40 percent of total
overseas investment in 2006.
Major acquiring cases include the acquisition of South African mines and
British mining companies by China's Zijin Kuangye; Lenovo's acquisition of IBM's
PC business; CITIC Group's acquisition of Kazakhstan oil fields; China Mobile's
acquisition of Pakistan telecommunications company, among others.
Feng He, a researcher with the Chinese Ministry of Commerce, said that major
reasons behind these overseas acquisition are that domestic enterprises want to
seek more developing room overseas; the state loosened its control on overseas
investment; and some large enterprises see overseas mergers and acquisition as
the best way to become internationalized.
Vice Minister of Commerce Wei Jianguo said that China will actively explore
international acquisition and other investment patterns to acquire famous
brands, advanced management experiences and marketing network, and will
gradually foster its own international giant companies.
Assistant Minister of Commerce Chen Jian urged Chinese companies to increase
their sense of social responsibility and actively redound upon the local
society; actively develop localization and increase local employment; make
efforts to cultivate talents to meet the needs of international development; and
establish a risk control mechanism.