The Impacts Of M&As On Chinese Industry Structure

Multinational corporations'M&As have developed rapidly since 1990s, and it leads to the fifth global multinational M&A waves. In this wave, multinational corporations gradually replace green investment by its low cost and low risk, becoming the dominant form of FDI (Foreign Direct Investment). Hence, we can see multinational M&As have become a trend, an important means of corporation's living and developing. Multinational M&As mostly happened among developed countries for a long time, according to statistics, the data are account for 70%-80% of multinational investments, and they mostly happened in America and Europe. But in the recent years, the developing countries are accelerating multinational M&As, especially in the Asia and Pacific region. China as a growing up developing country is getting a high attention from the whole world, so this M&A waves are sweeping to China. At first, M&As in China developed slowly for governmental limits and some other reasons, but along with China's opening and multinational corporations starting a series of M&As in order to carry out their global stratagem by their advantages of capital, technology and management, so later, M&As has become a hotspot and light spot in our capital market. Because M&As in our country can bring more capital, advanced technology and advanced management means, further more, they can help domestic enterprises come to the developing global economy, promote domestic enterprises'competitive power in the international market, so China basically has an encouraging attitude. However, one research report from Development and Research Center of State Department indicated, M&As have already monopolized and controlled most of our primary industries, and have brought huge impacts on our economy development and industry adjustment, both positive and negative impacts, so research multinational corporations'FDI and M&As, and their diversified impacts will be very meaningful for us to seize this precious opportunity and face the challenge of future foreign capital coming to our country.The first part of this paper introduces some theory knowledge about foreign capital's M&As, such as its meanings, its definitions from different scholars and different books, various analysis of driving power, and plot of its major styles according to different criterion.The second part mainly introduces the development of foreign capital's M&As. Firstly, global FDI and M&As are expanding rapidly, and they both got the highest numerical value in 2007; Secondly, foreign capital's M&As in China have come to a new time, and have been developing speedily since 2003; Lastly, introduce its development character in details, for example, foreign capitals mainly merge and purchase our good-sized state enterprises, companies coming into the market, mainly fasten the second industry, merge and purchase areas distributing odds and so on.The third part is the most important part, firstly, introduce the developmental actualities of our country's industrial structure, the proportion of the first industry is falling annually, the second industry is stably rising, and the third industry is falling, too, but this structure isn't reasonable, so we should pay attention to their harmonious development; Secondly, describe the positive impacts of M&As in details, such as, technology spillover domino effect, which can reduce to five points: demonstration-imitation, competition, training, association and exporting effect; promote our high-tech industry developing: multinational corporations transfer their producing and machining base of high-tech products to China, our large-scale companies enhance the devotion of technical personnel and outlay, increase research, produce and export of high-tech products, our government supports the development of high-tech industry in policy and finance; elevate our manufacturing industry concentration: to some extent, M&As alter market structure, making competitive pattern go rational, hence form a certain market concentrating industry competitive pattern, and optimize industry structure; advance our national industry upgrading from manufacturing branch to the forth and the back: one side, look on research aspect, the other side, look on market, marketing and brand, so we can exalt our large-scale corporations'innovative ability, boost up new products'international competitive power, enhance famous degree of Chinese brand; upgrade our developing level of service industry, the entry of foreign service industry can make up the deficient capital of our service industrial investment and construction, increase the proportion of service industry accounts for national economy, optimize our national industry structure. M&As not only promote our industry structure upgrade, promote our economic developing level boost, bring economy rising domino effect, increase our residential living level, but also in some sense advance domestic effective demand, improve residential consumptive structure and consumptive concept, spur investment to flow into more income-elastic products, further more they accelerate our industry structure optimizing and upgrading; lastly, describe the negative influences of M&As detailedly, such as, market monopoly, gamble investment, employment extrusion, technology marginal effect, perish our most of domestic brands and enlarge developmental gap among three industries and so on, all these hold back upgrading our industry structure and hold back boosting our economy.The last part of the paper is the fourth part, which mainly brings forward some effective measures against the negative influences of M&As, for example, set up new concepts of optimizing industry structure, changeover governmental functions, reinforce the instruction and criterion of M&As; truss our national economy security preventive system; strengthen the protection of our national brand; develop capital market actively, quicken to foster agency institutions to serve transnational M&As; pick up developing and building our national big corporations and corporation groups, elevate our corporations'international competitive power.