The Research Of The Policy Environment Of Developing Shanghai Local Multinational Corporations

Multinational Corporations have an important impact on the pattern ofWorld Economy, and become a new force to lead the globalization of worldeconomy gradually.Since China’s reform and opening up to the world, Chinese companiesbegan to go abroad. But after years of operation, the development of Chinesemultinational corporations in terms of quantity and quality are far fromsatisfactory, which admittedly is owing to the Chinese corporations’ backwardinvestment philosophy and management mode, but also is owing to the lack ofthe government’s systematic policy environment of developing multinationalcorporations, such as preferential polices, policy-based finance and so on. Fromthe international experience, the fundamental factors in the developmentand agglomeration of local multinational corporations are a seriesof policy innovation. In the early development period of multinationalcompanies, enterprises need state support and policy support, because statesupport and policy support in a way is likely to become a decisive factor in thesurvival rate of multinational companies. According to Michael Potter’sNational Competitive Advantage Theory, the government plays an importantrole in upgrading the country’s international competitive position in the world,the government makes regulations and support policy to create competitivenational advantages, such as through the guidance of key industries, competitivestrategy, structure and competition situation of enterprises. According to the Report of the Eighteenth National Congress of theCommunist Party of China, which emphasized that,"We should speed upthe ’going global’ pace, enhance the ability of enterprise internationalization, anddevelop a number of world-class multinational corporations". To cultivate anddevelop local multinational corporations is the top priority job of Chinesegovernment recently. Given the current situation of domestic policies ondeveloping multinational corporations are not in complete and systematic frame,it is very necessary to conduct in-depth analysis of the existing policies andprovide the theoretical research on government how to make relative policy ofdeveloping local multinational corporations.Shanghai enterprises has a long history of "going global", at present thereare many local multinational companies, but their multinational degree are verylow, the overseas business is also facing heavy resistance. Therefore, in thebackground of the new stage of opening to the outside world, and especially onthe occasion that Shanghai has been approved to conduct the trail “Free TradeArea” framework pilot, it will be very meaningful to shanghai as well as tochina to do the research on the policy environment of developinglocal multinational corporations.The author is engaged in Foreign Direct Investment Cooperation approvaland management work in government departments. Therefore, this article willtake shanghai enterprises’“going global” situation for reference, to conductexploratory research on policy environment of developing local multinationalcorporations. Generally speaking, the government should improve the policyenvironment, do well service for local multinational corporations when they goabroad.Therefore, based on analysis of the theory, using international experiencefor reference, this thesis will study on shanghai local multinationalcorporations’ status and prospects, analyzing the advantages and existingproblems of developing local multinational corporations, and put forward the policy recommendations to Shanghai government.The policy suggestions consists of four parts: First, we should formulatethe national strategy for the development of local multinational corporations,Secondly, we should define the standard of local multinationalcorporations, which can help us to define the policy support object; Thirdly weshould build the comprehensive service platform for local multinationalcorporations, the main purpose of which is to provide financing channels tooverseas investment, and we should also build the integrated facilitatingplatform to meet the requirements of different stage of oversea investment. Lastbut not least, the government should draw up the preferential policy to supportthe oversea business of the enterprises, and simplified the approval procedure ofoversea investment.