In 2018, the Forum themed “Shifting opportunities and Emerging Challenges” was co-organised by the LSESU China Development Society and KPMG, and sponsored by Foremost 4 Media and Entrepreneurs Global. The Forum attracted 12 prominent speakers and business leaders, over 100 students from leading universities and 40 professional audiences.
Mr Jackson pointed out the steadily strengthening UK-China relationship by comparing the business environment 12 years ago with today, where there was only one Chinese manager at KPMG’s London office in 2006, yet now there is a dedicated team of Chinese managers and partners leading the business in the UK.
He emphasised KPMG’s role in actively helping Chinese investors break into the UK market and facilitate bilateral trade deals: In 2016 KPMG advised 10 of the 20 top Chinese outbound investment deals, and 3 out of 5 of the largest M&A outbound deals from China.
He also expressed optimism in the UK side around the China-UK relationship during the post-Brexit period, and raised hopes of agreements signed for the UK government to partake in the Belt and Road initiative.
Keynote Speech 1:
Where Next For China’s Outbound Investment
Mr. Gordon Orr
-Executive Director of Lenovo, wire Pacific and BioProducts Laborator
Chinese M&A this year had been hit by government intervention and tight regulatory regime on Chinese investment around the world, the US especially.But tariffs do not do actual harm to Chinese firms because companies such as Haier already have significant manufacturing presence within the US. The Chinese government had intervened in companies’ decision to invest overseas because it wants to reduce risks within and without China. But this has not hampered most Chinese firms’ overseas expansion for example in the Last Vegas Consumer Electronic Show that just concluded, one third of participating companies were Chinese.
Collaboration between Chinese and Silicon Valley start-ups is continuing, and on the more matured side, Chinese investments bring in much needed investments. China these year will also shift to more strategic assets with a sustained emphasis on acquiring IP for example the collaboration between COMAC and Boeing in the aviation industry. All activities should align with the Made in China 2025 plan.
Gordon mentioned a few sectors that will be dominated by China, for example in the manufacturing of Internet of Things and E-sports.
Brexit is not changing much for Chinese investments other than making it much cheaper, because of Britain’s skilled workforce that is used to working with foreigners. Outside of the limelight, Chinese companies are collaborating closely with British firms on technology and this should be encouraged by the UK government. The UK has been moving in the right direction when we see Chinese companies acquiring F1 and aviation technology in the UK. Not all investments by Chinese companies into UK have gone to plan but greater preparation now mean that history is less likely to repeat. Most importantly, a lot of the investments into UK are going to be invisible a case in point is Chinese companies setting up offices in Manchester and Nottingham to work with university spin-offs.
Gordon concluded that Chinese companies will see a rebound of M&A activities this year but also witness more organic growth that target companies with more aligned operations, and at the same time invest less in the US and more in the UK.