China will also continue to utilize the massive wealth and immense brainpower that make up the China Investment Corp. (CIC), the largest sovereign wealth fund in the world. Founded in 2007 with $200 billion in assets CIC has leveraged smart investments and savvy partnerships into more than $600 billion in 2014. Smart global companies, banks and others will continue to engage with and seek partnerships with CIC.
China will also actively encourage and assist private and state-owned companies to invest in overseas mergers and acquisitions (M&As), minority stakes and greenfield projects.
China's economy is still growing faster than almost any other economy on Earth and, relative to its maturity, the rate is impressive. One of the fruits of this growth is that the country and its companies are awash in cash. A great deal of investment is being deployed in China to develop industries, infrastructure, healthcare, urbanization and local companies and brands.
Still, there is ample cash on hand at all levels to invest in projects overseas.
"China Going Global," as China's global step forward is known, is healthy for China and the world. A key determinant of success for China Going Global will be in Chinese companies' abilities to expand their operations, sales, brands and presence in developed markets.
In 2015, Chinese companies and investors are expected to build on the success of M&As in 2014 with even more activity. As Wanda Group proved in 2011 (acquiring the AMC cinema chain) and WH Group proved in 2012 (buying U.S. producer Smithfield Foods), Chinese companies can reap the rewards of new customers and the attainment of new technologies, best practices, distribution, supply chains and personnel through M&A activity.
I expect the following companies to be active in overseas investment and growth in 2015.
Alibaba should be making major investments in overseas supply chain and operations projects. It will also engage in a massive global branding campaign, investing heavily in creating e-commerce platforms in the United States, Europe, India and Africa.
Lenovo is seeking to expand its global footprint in the mobile communications category and has the smarts, the muscle and the legacy product mix to make it work.
Chinese conglomerate Wanda Group's motto should be Let Me Entertain You, the song from the musical Gypsy. From movies and TV shows to Web content, theaters, hotels and resorts--if it can put a smile on your face, Wanda will be investing in it and doing it well. A play for a major Hollywood studio is possible.
The investment firm Fosun has now established itself as not only a major Chinese firm but also a major global firm to be reckoned with. It completed its takeover of Club Med this year, acquired Meadowbrook Insurance for $433 million and is a factor to be considered in any major investment opportunity in China, the United States and Europe.
Some of the categories where I see the most action taking place include--media and entertainment, e-commerce, hard asset real estate, FIRE (finance, insurance and real estate) service providers, and food and beverage industry.
As I wrote about in my new book China's Super Consumers the era of the China Global Demographic/Consumer/Investor has arrived. What makes a China global consumer? It is the nexus of Chinese consumers becoming mobile--using mobile devices, acquiring brand and product sophistication; and a want/need to invest their time, money and future inside and outside of China.
In 2015, individual Chinese will increase investments in overseas capital markets and investment vehicles as well as overseas real estate. Chinese investors rank first in dollars spent in New York City. They will also continue to invest in education abroad. For some families, the ideal mix is a Chinese and foreign education that will ensure their children are prepared for a global economy. U.S. and European universities love the smart, prepared and ready Chinese students who are willing to pay full tuition. They will also invest in global luxury products and services and spend more on experiential luxury.
Chinese will continue spending on travel. China set a record with more than 100 million outbound travelers in 2014. That number will likely double in the next two years thanks to increased wealth, consumer sophistication, business engagement and new China global consumers. The recent agreement between the United States and China for 10-year visas will further spur investment in travel.
China has gone global and shows no sign of stopping. Investments by the Chinese Government, banks, investment companies, corporations and private individuals will grow exponentially in 2015 and this is good news for the countries, companies and governments receiving the investment and the investors from China who stand to profit.
The author is vice president of China/Asia Pacific Practice at the global consulting firm Tompkins International
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