Kaartemo, Valtteri, 1983-

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ABSTRACTSubject International business Date 16.3.2007Student numberAuthor(s) Valtteri KaartemoNumber of pages 137Title The motives of Chinese foreign investments in the Baltic Sea regionSupervisor(s) Ph. D. Kari Liuhto, M.Sc. Kaisa-Kerttu HannulaAbstractThis is the first research, which aims at exploring the motives of Chinese foreign investments in theBaltic Sea region (BSR). In order to analyse Chinese companies from the perspective of theircompetitiveness, the research problem was further elaborated into two sub-questions:1. What are the existing sources of competitive assets which the Chinese companies exploit wheninvesting in the Baltic Sea region?2. What are the alternative sources of competitive assets which the Chinese companies are seekingby investing in the Baltic Sea region?The theoretical framework introduces motives of FDI from the perspective of asset-exploitation andasset-seeking with a special view on FDI from less developed countries (LDCs). The empirical partconsists of five case studies. The multiple case study was selected as a methodological approach asit was considered providing a thorough understanding on the motives of Chinese companies but stillproviding firm-specific information. Moreover, a single case study method proved to be difficult toconduct due to severe difficulties in getting access to valuable information. The case studies relymainly on the interviews for which questions were derived from the theoretical framework and theprevious researches on Chinese foreign investments. In addition, secondary data was collected fromstatistical resources, Internet and expert interviews as a background material for the research.The research findings indicate that Chinese companies are interested in the Baltic Sea region toexploit their existing competitive advantages and to seek new assets. The existing competitiveadvantages of Chinese companies stem from established networks with other, mainly, Chinesecompanies, from low cost level, and from product-related know-how. In the BSR, Chinesecompanies are mainly interested in local knowledge, local and global company networks, product-related know-how, and a possibility to improve image. It is notable that only local knowledge is akind of an asset which benefits the investor only in the Baltic Sea region markets. Other sources ofcompetitiveness which the Chinese companies were found to seek from the Baltic Sea region,namely networks, product-related know-how and image, improve the investors position not only inthe Baltic Sea region but can also be exploited in the home market and globally.Spatially determined sources of competitiveness seem to have lost their relevance, and thus alsoChinese companies are more interested in company networks. As the motives of Chinese companiesto invest in the BSR are diverse and the investments are anticipated to increase in the future, thisrequires activities from the local business, policy-makers and the academia to better adapt to thechanges caused by the emergence of Chinese companies within the region.Key words Foreign Direct Investment, China, the Baltic Sea region, investment motives, asset-exploitation, asset-seeking, Chinese companiesFurtherinformationx   Master´s thesis  Licentiate´s thesis  Doctor´s thesis

Motives of Chinese foreign investments in the Baltic Sea Region

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Motives of Chinese foreign investments in the Baltic Sea Region

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