In The News

Increased Uncertainties in China Outbound Investment, Investment Opportunities Highlighted Along ‘Belt and Road’ Countries

China Financial News

20 Oct 2018

Morrison & Foerster partners Chuan Sun, Shirin Tang, and Amit Kataria shared their views with China Financial News on a number of topics, including foreign investment controls in the United States and EU, Southeast Asia as an investment hotspot, and Sino-Indian cooperation, in the China Financial News article “Increased Uncertainties in China Outbound Investment, Investment Opportunities Highlighted Along ‘Belt and Road’ Countries.

According to Ms. Tang, opportunities for Chinese companies investing in “Belt & Road” countries vary by member country because of different demographics. For example, financial services, emerging technology, business services, and logistics are the key investment industries in Singapore, while for Malaysia, Indonesia, and others, investing in infrastructure facilities and other industries as part of pan-regional platforms is more common.

“Political risk is the biggest risk in the SEA region. Law and policies can sometimes change with each election cycle, which can create the uncertainty of law, politics, and business environment,” she said. “Therefore, it’s important to acknowledge the risk before investing in the region and pay attention to such development throughout the transaction process.”

According to Mr. Kataria, compared to the SEA region, India has relatively low or no legal and political risks. India’s judiciary is independent from the government, which, to a certain extent, can ensure stability in the interpretation of law. For India, Chinese investors can look at key areas, including infrastructure, manufacturing (semiconductors and electrons), technology, pharmaceuticals, financial services, logistics, hospitality, e-commerce, and energy (renewables).

More importantly, China and India are both vital economies for the Asia region, as well as being the world’s most populated countries. As China and India continue to develop their own economies, the benefits and potential of cooperation between the two countries becomes clear. “China and India have a strong foundation for cooperation. The strong will to collaborate is seen in areas such as telecommunications, e-commerce, and medical. Also, companies such as Tencent, Alibaba, and Fosun are already investing in projects in India. I am positive about the outlook for China-India investments,” he said.



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