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Germany’s Chinese investment problem

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Re: Germany’s Chinese investment problem

#21

Post by baq »

tonyedgecombe wrote: post #5
devoply wrote: post #4

Earlier quoted context omitted.

I think China is going to be greatest civilization... or that's their aim. And with their population and level of growth they may very well get there.

They will have to become more democratic and accountable to their population first. Up to now they have been able to buy off their middle classes with rising incomes, once that stops as it inevitably will those people will start calling for more representation.

> They will have to become more democratic and accountable to their population first.

I respectfully disagree. There is no need to do it as long as near total control over information is possible - and it is . Western, money-and-profit-oriented business don't see or don't care that any help they deliver in exchange for money will kill them later when internal-external asymmetry of Chinese economical and political system becomes too cumbersome to deal with.

China is positioning itself as a global monopoly externally but cutthroat capitalism internally. External players are allowed in only if they bring more than they take out - again, they might not notice or not think it's a problem.

Re: Germany’s Chinese investment problem

#22

Post by jakozaur »

After the second world war, Soviet Union was growing so fast that many smart people in western world that communism is superior to capitalism.

However, Soviet Union economic growth peaked in 1959. It was primarily based on catch up growth: recovery from WW 2 and moving ppl from agriculture to industry.

Is China similar story? http://blogs.ft.com/beyond-brics/2015/12/09/like-soviet-russ...

A good read on that: https://www.amazon.com/Why-Nations-Fail-Origins-Prosperity/d...

I give 50/50 chance to China will avoid this fate, but not more.

Re: Germany’s Chinese investment problem

#23

Post by QuantumRoar »

yousry wrote: post #13
simonh wrote: post #3

"Oh woe is us. Who will save us from downing in all this Chinese money." There were exactly the same concerns about Japanese investment back in the 80s. Now doing business with Japanese firms and companies like Sony owning major American firms is just natural. They're not weird alien creatures from space anymore, they're our business partners and investors. It's normal. The same will happen with China.

Related News from last week: The government had cleared the deal on Sept. 8 but Aixtron said that the Economy Ministry had now canceled the clearance certificate for Fujian Grand Chip Investment Fund LP (FGC), a Chinese investment fund controlled by businessman Zhendong Liu, and planned to reopen a review of the takeover. The decision to rescind the approval was based on “previously unknown security-related informati…

Aixtron hasn't been doing too well lately. So there is definitely a positive side to an acquisition.

From Aixtron's website on November 17 [1]:

>CFIUS [Committee on Foreign Investment in the United States] informed the parties that it plans to recommend to the U.S. President that the transaction be prohibited based on CFIUS’ conclusion that there would be no reasonable way to mitigate the U.S. national security risks perceived by CFIUS on the basis of the mitigation proposals submitted by the parties to date.

> Both, GCI and AIXTRON have decided not to follow such recommendation as a result of which the matter has been referred to the U.S. President for decision in line with CFIUS statutes.

If I understand that correctly, Aixtron SE has investments in the USA and the CFIUS is now moving to block the acquisition because they think if GCI owns these investments that the national security is threatened.

Or am I misreading something?

[1] http://www.aixtron.com/en/press/press-releases/detail/aixtro...

Re: Germany’s Chinese investment problem

#24

Post by meira »

JBiserkov wrote: post #11
paradite wrote: post #7

I am surprised to see Hacker News turning into China News recently.

Warning: Gross oversimplification and misrepresentation of facts ahead There is an apparent trend of Planet Earth turning into Planet China recently. Whether this trend is real, whether it will continue, whether you or I believe in it - who knows.

> There is an apparent trend of Planet Earth turning into Planet China recently.

Not planet earth, Planet US.

Re: Germany’s Chinese investment problem

#25

Post by bjshepard »

tonyedgecombe wrote: post #5
devoply wrote: post #4

Earlier quoted context omitted.

I think China is going to be greatest civilization... or that's their aim. And with their population and level of growth they may very well get there.

They will have to become more democratic and accountable to their population first. Up to now they have been able to buy off their middle classes with rising incomes, once that stops as it inevitably will those people will start calling for more representation.

This is a plenty democratic place, I recommend coming and observing it with your eyes, asking people here questions, and assessing the history of the revolution yourself.

Re: Germany’s Chinese investment problem

#26

Post by noir-york »

jakozaur wrote: post #22

After the second world war, Soviet Union was growing so fast that many smart people in western world that communism is superior to capitalism. However, Soviet Union economic growth peaked in 1959. It was primarily based on catch up growth: recovery from WW 2 and moving ppl from agriculture to industry. Is China similar story? http://blogs.ft.com/beyond-brics/2015/12/09/like-soviet-russ... A good read on that: https:/…

Russia had a ceiling: Russian population was less than that of Europe or the US. Chinese population is larger than both combined.

Russia was wedded to an ideology; the Chinese are pragmatist and practicing corporate capitalism. China will not only avoid the same fate, they will almost certainly come to dominate by sheer force of numbers.

China is practicing the economics equivalance of embrace (buy Western technology), extend (their own 3G standards for instance), and eventually extinguish (locking the West out of their market)

Re: Germany’s Chinese investment problem

#27

Post by adrianN »

simonh wrote: post #14
tonyedgecombe wrote: post #5

Earlier quoted context omitted.

They will have to become more democratic and accountable to their population first. Up to now they have been able to buy off their middle classes with rising incomes, once that stops as it inevitably will those people will start calling for more representation.

Possibly, but again Japan provides a case study of an alternate possible future for China. Japan also had a massive property bubble which burst spectacularly. It also had a single party with an effective monopoly on political power. Yet they avoided social upheaval and stayed in power, even in a democracy, by drowning the government in debt for decades. AT first the 90's were referred to as the 'lost decade', but eve…

Japan was hit by a recession around 2012 (or the aging workforce starts to play a bigger role), but before that the GDP per capita development wasn't actually that bad.

http://www.economist.com/node/10852462

Re: Germany’s Chinese investment problem

#28

Post by noir-york »

China is practicing the economic equivalent of embrace (buy Western technology), extend (their own 3G standards for instance), and eventually extinguish (locking the West out of their market).

As private individuals, we don't mind being bought out by Chinese. As members of societies, I believe it is important to know that there is a concerted plan by China that is at best neutral, and at worst, hostile to Western economic interests. Individual gain at the long term loss of the society we form part is not really in anybody's interest.

We should still trade with China, obviously, and even sell companies, but the terms of trade should not be one-sided: Western companies should get the same market access as Chinese companies do.

Re: Germany’s Chinese investment problem

#30

Post by stupidcar »

simonh wrote: post #3

"Oh woe is us. Who will save us from downing in all this Chinese money." There were exactly the same concerns about Japanese investment back in the 80s. Now doing business with Japanese firms and companies like Sony owning major American firms is just natural. They're not weird alien creatures from space anymore, they're our business partners and investors. It's normal. The same will happen with China.

This seems to ignore the main objection. It's not that Chinese companies are investing in European economies, it's that these companies are run by the Chinese state, and that China is not providing reciprocal access to its own market to Western companies. This is not natural free-market activity, it is a state-sponsored effort to take technology and expertise from European companies and feed it into state-owned Chinese ones.

For all the fears raised recently about rising Western nationalism and protectionism, the Chinese regime is blatantly and unashamedly nationalist and protectionist as a matter of course. The state decides who wins and who loses, and they will simply not allow foreign companies to gain a dominant market position in any significant sector. All market activity, including foreign investment, is tolerated only so long as it is subservient to the nationalist goal of Chinese hegemony.

For years, Western politicians and businesses have turned a blind eye to China's flagrant disregard for the basic rules of free global trade. Partly out of greed for Chinese money and market access, and partly due to an entirely wishful assumption that this is only a phase, and that China will eventually start playing by the rules and acting like a "normal" free market economy.

This delusion demonstrates a fundamental misunderstanding of how autocratic regimes like China operate. Just as they cannot, and will not, tolerate any significant internal competition to their own authority, they will, in the long term, not tolerate any external competition either, either political, military or economic. The Chinese state will never be satisfied being one powerful economic actor amongst others, all playing by the rules of a global market. They will never accept being checked by laws of trade or other country's interests, any more than they will tolerate being checked by democratic accountability or rule of law.

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