Multinationals' Investment Holdings "," Monopolization "trend

The foreign direct investments have increased rapidly since the Reform and Opening up, which have been pushing forward the process of Marketification and the economic increasing in China exceedingly. MNCs'investments in China can be divided into two stages, from the visual angle of the changes of the stock right structure, the first stage was mainly the Joint Ventures and cooperative enterprises before the metaphase of 1990's; the second one was mainly the stage of controlling-stock and exclusive investment after the metaphase of 1990's, especially after China entering WTO, the controlling-stock and exclusive investment of MNCs have been building up in China..It mainly shows two changes in investments, On the one hand, the new increase FDI is changing form the main Joint Ventures into the main Wholly-owned Ventures; on the other hand, the Joint Ventures have been changing into the wholly foreign owned company by the expanding foreign capital volume and share proportion in venture and the purchasing sharing right of China's Ventures. The trends of holding share and exclusive investments not only directly produce a great impact to microcosmic main bodies who have a hand in Joint Ventures and other enterprises correlated with it, but also exerts an important influence on the purpose and overflowed -effect of bring investment from macro economy. Due to it are the Joint Ventures of MNCs and China's Ventures that take place the obvious changes; the thesis establishes the analyses frame as to circumstance- stratagem- conduct from The FDI theory of MNCs. The paper analyzes the operating strategy transformations of MNCs from simple integrations to global or compound integrations start with the analyses of the environmental changes of FDI of MNCs.Correspondingly, the FDI stratagem of MNCs have changed from the simple integrated strategy to the multiple integrated strategy, which must influences the relationship of MNCs and their son companies in China and strengthens the JointVentures' control and the demand of control right MNCs adjust the tactics and the modes ofFDIin China to meet the changes of strategies. Firstly, the Greenfield Investment chooses the holding shares or the foreign wholly owned Ventures. Secondly, the Cross-Border merger and acquisition of MNCs in China adopts the holding shares or purchasing whole share right of enterprises. Thirdly, the Corporate Governance mode of the Joint Ventures chooses the MNCs dominating mode, and quickly deprive the shares right of China's Ventures.These changes of MNCs' FDI strategies and modes brought directly the instability in the Joint Ventures, which represent the benefit conflict, the manage conflict and the culture conflict The aggravations of these conflicts show that the Joint Ventures are an instability mode. Because there are two different interests bodies in it and the knowledge and information of the cooperators can not be consistent with, under given restriction of institutions, MNCs' FDI in China established the Joint Ventures only as the sub- best choice or transition stage. If system without being restricted, the temporary incorporated balance of playing chess will be broken out, and it must help the MNC s to change the stoke right structures of joint ventures, that means joint ventures are disintegrated or one part buying the other's stoke rights to realize holding shares or exclusive investment Therefore, the holding shares, exclusive investments of FDI are nature market behaviors of MNCs under the new circumstance of reform and opening up in China, which include some regularities and inevitabilities. The shares changes of MNC s' FDI in China, on the one hand reflect the change process of MNCs'strategy along with the changes of environments, on the other hand, it embodies China's Market Economy' process of developing, perfecting and maturing. It is foreseen that the wholly owned trend of MNC s' FDI in China will be strengthened in process of future economic development in China..The holding shares and the wholly-owned trend of MNCs'FDI in China bring negative influences, such as industry-monopoly, market and technology-monopoly in the macro-economy, and also bring negative influences in the micro-economy, do harm to China's Ventures, erode the brand of state-owned brand and lose thestate-owned asset and so on. In view of the above, the thesis indicates specific measures and proposes to eliminate negative influences: Firstly,' China's government should adjust policies of FDI, and should supervise the actions of infringing the interests of Chinese parts. Secondly, we should promote the ability of learning and competing of China's Ventures, and prevent that MNCs do harm to Chinese interests.