Export Development Practices by Chinese TNCs

Denis Borisovich Kalashnikov
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Denis Borisovich Kalashnikov: Moscow State Institute of International Affairs (MGIMO University), Russia

Russian Foreign Economic Journal, 2019, issue 3, 74-86

Abstract: Russia faces the challenge of increasing non-energy exports complicated by growing protectionism in the global economy. China successfully addresses a similar issue; therefore, it is important to study the Chinese experience. The study found a lowering role of foreign trade in China’s economy and a growing importance of its companies’ overseas activities. Nevertheless, the activities of Chinese multinational corporations are mainly aimed at promoting domestic products on global markets, and the majority of their foreign divisions are small businesses. Compared to traditional exports, overseas sales of MNCs have several advantages: 1) initiative in forming the export product mix; 2) direct contact with consumers of products allowing to identify the shortcomings of products and ways to improve it; 3) ability to organize after-sales service and software updates; 4) elimination of several links of resellers, thus redistributing value added in favor of Chinese businesses; 5) expansion of demand for the related to Chinese exports products, in particular services. Special attention is paid to the new form of MNCs - digital cross-border online trading as it eliminates intermediaries in retail sales and provides direct access to foreign end-users resulting in the export value added maximization.

Keywords: Global value chains (GVC); TNCs; MNCs; exports; digital trade; foreign economic activity; small enterprises; People’s Republic of China; One belt one road; Silk Road Economic Belt. (search for similar items in EconPapers)
Date: 2019
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