Research On Industry Competition Which Based On Transnational Corporations Aggravating Mergers And Acquisitions In China

During the late2080’s and the early2090’s, there is a very significant economic phenomenon in the international economic activities. That is Cross-border Mergers and Acquisitions (CM&A) develop rapidly. CM&A is a "double-edged sword". On one hand, it optimizes the distribution of industrial resources to some extent; it improves the local employment levels; and it causes the technology spillover effect on the local economy. On the other hand, it has an impact on a country’s industrial development. Nowadays, China is in the big wave of the global economic integration, it reforms deeper and opens more expandable. Foreign investment plays more and more important in the economic development. CM&A is becoming the main way of the foreign direct investment. When we see the advantages of the CM&A, we should look clearly that it weakens our country’s industry competition level seriously, and threats our country’s economic security to some extent.Since our country carries out the policies of the reform and opening, attracting foreign investment is its main part. And we hope that more and more foreign investors come to China. However, it always shows new investments in main, and the foreign capital M&A is still in the early stages. In recent years, our law of M&A becomes perfect, and it contributes to the development of CM&A. The scale of the CM&A becomes more and more larger; it requires the corporate control strongly; it even forms the industry-wide takeover situations. As a result, it has brought tremendous obstacles and threats to our country’s economic development. In such a situation, it becomes a concerned problem of Chinese government departments and theorists on how to dealing with the transnational corporations aggravating M&A and the adoption of appropriate industrial strategies.This paper is guided by Marxist dialectics. It is in the background of economic globalization and China’s opening up policies. It probes the theoretical foundation, the main performance and trends of the transnational corporations aggravating M&A systematically and comprehensively; It analyzes the severe situation that the transnational corporations aggravating M&A weakens our country’s industry competition level seriously and threats our country’s economic security to some extent; It puts out strategy for improving our country’s industry competition level, optimizing the structure of the industry competition, and safeguarding national economic security from three level of government,industry and enterprise based on the international practices and experiences of both developed and developing countries.