China Strategy:Dealing with De-Globalisation

Brexit adds further urgency to the need for China corporates to buildmultinational platforms. Rising trade barriers are one of the Six Drivers ofChina’s corporate internationalisation we identified in our China Strategy – Yearof the Eagle report. While we believe China is well placed to withstand the neartermpressures of Brexit, rising protectionism and populism globally are a threatto China’s export growth. Companies that are building multinational businesses –represented by our Eagle picks – will put even greater distance betweenthemselves and competitors that insist on remaining in China. Midea, Fuyao,Minth, Lenovo, TCL and Ctrip have already built substantial multinationalfootprints, while we see promising signs that Great Wall, Yutong, Alibaba,Vanke and Hengrui are following them.