Page 109 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.71, # 1, 2014, pp. 99-119

operations within the United States, with the company expecting to create an additional 150 jobs in the

upcoming year.

Haier

When people think of Chinese FDI they often assume its Chinese SOEs taking control of local

companies. However this isn’t always the case. Haier, a Chinese, state owned consumer electronics and

home appliance company, chose to expand into the American market by opening a $40 million dollar

production facility in South Carolina to cater to the American consumer. Today Haier employs over 350

people in its facility with plans to open new manufacturing centers in New Jersey, North Carolina and

Arkansas, creating hundreds of new jobs. Haier’s investment in the United States has legitimized the fact

that Chinese SOEs can make a positive impact in local economies through FDI.

These cases of Chinese SOE FDI are testament to the benefits that can be reaped from Chinese investment. It

is estimated that for every $500,000 of FDI ten new jobs are directly or indirectly created in the United Sates. These

success stories must be used as examples for Canada’s future approach to inward Chinese FDI.

Chinese FDI in Sub Saharan Africa

Chinese SOE FDI has also proven to be very beneficial in the energy sector. Sub Saharan Africa is

the second largest target of Chinese SOE FDI with the majority of the investment being made in the

energy and resource sector.

• Sudan: While Sudan has large reserves of oil it lacked the financial and technical knowhow to

develop these oil fields. Chinese FDI by SOEs contributed significantly to creating capacity in the oil

sector providing the double effect of expanding Sudan’s oil exports and giving rise to other industries

based on oil, like plastic and road construction.

109