China Emerging_ 1978-2008 - Xiao-bo , Wu [53]
At the same time, multinationals began to enter fields that could be described as being more “monopolistic” and less “competitive.” In the early and middle periods of reform and opening up, the great majority of multinationals that came into China were operating in perfectly competitive market arenas. The ones that achieved the greatest success were Coca-Cola, producing beverages; P&G, producing shampoo; and Japanese companies, producing home electronics. As Chinese companies moved into these consumer areas, multinationals found it increasingly harder to compete, unless their Chinese competitors made some fatal mistakes. After 2001, multinationals began to enter natural resource sectors because for the first time, they were allowed to invest in cooperative ventures in these areas. In general, they moved out of businesses in which they were in head-on competition with China’s privately-operated enterprises, and stepped into those sectors that excluded privately-operated enterprises. For example, GE shifted its focus of investment from household items to things incorporating more technology such as medical diagnostic equipment, gas turbines, wind turbines, hydro-electric power equipment, airplane engines, electric transmission, and so on. Such investments promised excellent returns in China, and most were in areas where privately-operated capital was forbidden.
Multinationals also briskly entered the field of financial investments. The opening up of China’s financial markets was assigned a schedule after the WTO entry, and all large financial institutions now increased their China operations. By 2001, HSBC, Citibank, AIG Private Bank, Standard Chartered, and other banks had moved their regional headquarters from Singapore or Hong Kong to Shanghai. Some that had quietly set up organizations earlier now began to reveal themselves. According to the Economic Observer, many years earlier, Morgan Stanley had set up a venture with the China Construction Bank (CCB) and the China International Capital Corporation (CICC), the “only and the most outstanding joint-venture investment bank in China.” Morgan Stanley held 35% of the shares. In October 2001, for the first time, China permitted foreign investment in the disposition of nonperforming loans. At the first auction, Morgan Stanley, as a sole investor, was able to purchase packaged assets worth an estimated RMB 10.8 billion.
The assets were distributed throughout eighteen of China’s provinces and cities and included 254 companies and factories mainly in the fields of real estate, textiles, metallurgy, and pharmaceuticals. Most were previously assets of state-owned enterprises. Clearly, these nonperforming assets were
A grade school in an old revolutionary base in the countryside. During the past thirty years, there has been no fundamental change in the disgracefully backward elementary education in poor mountainous areas.
“surplus value,” resulting from the strategic policy of “State out, People in.”
While multinational capital continued to penetrate all corners of China, and state-owned capital made a strong comeback through reorganization, a Third Force, namely privately-managed capital, was vigorously contending for a place in the sun.
Finance had been a monopoly in China, reserved for state-owned banks. Any privately operated enterprise was dreaming of getting a piece of that cake. Now, however, a privately-operatedenterprisebecame the largest shareholder of a bank called the China Minsheng Bank, holding 7.98% of its shares. This bank was small, but represented an experimental-type commercial bank that had a clearly defined ownership
A postman goes up and around rugged terrain to deliver the mail. Photographed in August 2001.
Performing for customers in a restaurant. The market for high-brow culture was depressed when this photograph was taken in 2000; therefore, the actresses had to rely on this kind of job to make