the Swedish company knows clearly of how China is trying to choke the exit of capital from the country. To get out of their own profits have become more complex and it is also a costly procedure. To worsen the situation can propensity to go down.
Bilsäkerhetsföretaget Autoliv, which has 17 percent of its business in China, with annual sales of nearly sek 14 billion and approximately 8,000 employees, feel that the regulatory framework of credit have been tightened.
"It is a new process in the fourth quarter, where it takes longer time and is a lengthy process to bring out the money. We don’t know if it will be permanent or how it will ultimately affect our business," says Thomas Jönsson, Their communications director.
Even the group Stora Enso, which has a very large business in China, marked by the new and tougher restrictions.
"We are aware of the new stricter rules for kapitalutförsel from China. Capital restrictions already existed before in China, but now it has become a little stricter, ” says Carl Norell, head of media relations at Stora Enso.
"We have so far not been directly affected by the stricter rules but then you should take into account that it was not long ago they came into force", he continues.
Stora Enso a significant presence and has made major investments in China. The company has three förpackningsbruk, a paper mill and a mill for liquid packaging board in the country. The number of employees in China is around 5,500 and 2015, sales in China to approximately sek 6.7 billion.
"China is an important market for us with current needs of the out – and the introduction of capital. We follow the developments closely and has a continuous dialogue with the local authorities. Generally, when it comes to regulation, the clarity and predictability of the basic conditions for survivors", says Carl Norell.
the medical technology Company Getinge has two manufacturing facilities in China and it is the company’s sixth largest market. As late as in december a dividend of a significant amount went as planned.
"It required a certain process and condition, but we did not notice any difference from before. However, the system of how to manage the cash flow in China has become less flexible," says Peter Hjalmarson, Group Treasurer, who has responsibility for the company’s financial transactions.
bringing money from China is costly because it is imposed on a withholding tax.
"They want the money to stay in China and invested there, but we want to invest in research and development and production on other markets. In addition, we have promised our shareholders to distribute a portion of our profits. Therefore, we need to be able to get our money, ” says Lars Mattsson, ir manager at Getinge.
Both he and Peter Hjalmarson sees major disadvantages with tougher restrictions.
"If the situation worsens, we would be more reluctant to make further investments in China," says Peter Hjalmarson.
Behind the chinese the government’s actions is a fear of foreign reserves are falling and the currency, the yuan, continues to weaken. It has fallen to its lowest level in eight years, despite the extensive purchases by the central bank.
If it takes longer to get out of its profits, at the same time as the currency falls, reducing the prize value in dollars or Swedish krona.
Kullagertillverkaren SKF has been present in China since 1910 and has 17 production facilities in the country. Around ten per cent of the group’s sales is in China.
effects change the last few months, SKF has not known of, but since around a year have you experienced the tightening of the regulatory framework governing how the cash flow can be moved around in the group.
"so far, we are seeing an impact, in that the rules restrict our ability to fully utilize our positive cash flow in China within the rest of the group. But it remains to be seen how the rules will be applied in the future. They have not resulted in any drastic impact on our operational activities," says Theo Kjellberg, press officer at SKF.
In China, the question is sensitive. A number of Swedish companies in the country, from börsjättar to smaller entrepreneurial ventures, as the Di has been in contact has declined to comment.
doing business in China is a political hazard, and many business leaders choose low profile to avoid trouble with the authorities, or in the worst cases, blacklisting, a situation that worsened during the past few years.
"the Investment climate for international companies has deteriorated significantly during the ultranationalist president Xi, ” said Professor Willy Lam, an expert on chinese politics at the Chinese University of Hong Kong.
"Individual companies often choose to avoid criticising Beijing for fear of becoming targets," he says.
It has not only become more difficult for international companies to get money out of China. It has also imposed restrictions on chinese companies ‘ payments abroad, which may affect investment opportunities. Want to a chinese company making an acquisition abroad do not know the seller if the buyer is authorised to keep out the purchase price.
current example is the chinese HNA Tourism Group, added a mandatory offer at the Rezidor Hotel Group. According to a press release, your bid is associated with a single condition: the necessary regulatory approvals. A statement from the Swedish securities council stated that the HNA needs the permission from the two central chinese authorities. In addition, the actual amount should be recorded in China’s valutaövervakare Safe. It can’t be done until the HNA knows how many who accept the bid.
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