Overseas investments by private Chinese companies have become under unprecedented scrutiny, causing a severe drop over the first quarter of 2017. Political analyst Shaun Rein has never seen such a political pressure before, he tells the South China Morning Post.

The South China Morning Post:

While there’s no suggestion of wrongdoing, the heightened scrutiny of the companies underscores Beijing’s new attitude towards overseas mergers and acquisitions by private companies.

The number of major overseas asset purchases by mainland companies plunged by 80 per cent in the first quarter, as Beijing tightened controls on capital outflows and ratcheted up scrutiny into deal funding.

“Investors right now have to be political experts as much as valuation and financial ones – the political risk now is the highest I’ve seen in the 20 years I’ve been in China,” said Shaun Rein, founder of China consultancy Market Research Group, based in Shanghai.

China experts said the latest administrative measures pointed to the Beijing’s commitment to reduce financial risks ahead of an important political meeting this autumn.

More in the South China Morning Post.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers’ request form.

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