What do foreign companies bring to China? (1)

Today I watched an expert forum-type program on TV, which featured two figures who seemed to be economic experts discussing some of the economic focus of several media concerns, including the Danone-Wahaha dispute, Xugong mergers and acquisitions, and foreign banks and other topics. I've always paid more attention to these things. Having worked in a foreign company for a few years, I also have some feelings about it. I wrote these things, not from the economic point of view, because I am actually an amateur on the economy, dare not comment, only from the personal feelings to do some thinking.　　First, the way foreign companies enter China. From my understanding of some companies, it seems that foreign companies into China is not in accordance with the normal order of business investment, but the opposite. Most of the foreign companies enter China is according to the service - sales - production - R & D in such a sequence of gradual development. At the service and sales stage, in fact, the impact on the Chinese economy is mainly negative; it encroaches on the Chinese market, but China does not benefit. This is because what China wants most when it brings in foreign companies is to be able to bring in capital, employment and technology, and it is only when it gets to the production, sales and R&D stages that it can really have a positive impact on the Chinese economy. But it is clear that the market for technology is the road that must be taken.　　Second, foreign enterprises have affected people's lives. Nowadays, in slightly larger cities, KFC, McDonald's, Carrefour, and Simbucks coffee have become part of people's lives. At the same time, the entry of foreign companies into China has given many people the opportunity to enter foreign companies and get a job with a much higher income than before. The "white-collar foreign companies" have led to the emergence of a "middle class" in China, which until now was basically an economic class of officials, bosses, and wage earners.　　Third, foreign enterprises are monopolizing the Chinese economy. In the equipment manufacturing industry, multinational corporations have been holding mergers and acquisitions of China's leading local enterprises - Britain's Burton Electric Group merger and acquisition of Dalian Second Electric Machinery Factory, Sweden's Atlas Copco mergers and acquisitions of Shenyang Rock Drilling Machinery Company, Germany's INA mergers and acquisitions of the Northwest Bearing, Singapore's West Electric Company mergers and acquisitions of Dalian Electric Factory, Bosch reorganization of Wuxi Ltd., John Deere Holdings Jiamusi combine harvester plant, Siemens merger and acquisition of Jinxi Chemical Machinery's turbomachinery plant, the United States Caterpillar merger and acquisition of Shankong Machinery Company, Carlyle mergers and acquisitions of XCMG machinery, and so on, and gradually achieve market leadership. I remember reading a piece of information, in recent years, the open field of the domestic top five rankings of most industries are monopolized by foreign enterprises, including the well-known so-called national brand Wahaha. This can be seen, China's economic field of law is still very unsound, which gives those foreign enterprises monopoly opportunities. In the era of planned economy, there was no monopoly in the real sense. Nowadays, it is becoming more and more market-oriented, but there is no Anti-Monopoly Law in China so far.　　Fourthly, most foreign enterprises do possess advanced technology and management. Most foreign enterprises, especially those in Germany, Britain, the United States and Japan, do possess very advanced technology and management. In many technologies there are monopolies, for example, looking through the power plant heat transfer equipment technology patents, almost all monopolized by a few large foreign companies, domestic companies want to enter this field, you must find another way, otherwise it is illegal. In these patents, I can not see the three major domestic boiler plant patents, but it is gratifying to see some of the patents of private enterprises, which more or less let people see some of the hopes of the national industry. Chinese people have a very strong ability to imitate and innovation, which the group of foreigners also have to admire. Therefore, leading in technology is not without hope. In management, is not incapable, only there is no good environment, which can be seen from the "Yu Zhian incident".　　Fifth, where the profits of foreign enterprises? According to China's Ministry of Commerce statistics, as of the end of 2005, in all foreign-invested enterprises, more than half in a loss-making situation. However, for a long time, foreign-invested enterprises have been the existence of "long losses do not fall" and "the more losses, the more investment" phenomenon, which is contrary to the normal business logic. What is behind this "puzzle"? It is that foreign-invested enterprises are actually making profits in name only! The anti-avoidance officials of the State Administration of Taxation (SAT) believe that more than 2/3 of the losses of FIEs are artificially created for the purpose of tax avoidance. --This paragraph is taken from an article, but the conclusion of this article I think is bullshit. The article thinks that the reasons are: 1) our country's insufficient crackdown on "illegal tax avoidance" by foreign enterprises; 2) various places provide preferential policies or even take sides in order to bring in foreign investment. Personally, I think the root cause is the inadequacy of our tax laws. The purpose of enterprises is to chase profits, and no one is exempt from this. Increase the cost to be able to pay less income tax (tax rate of about 33%), which is to run a business are aware of the reasoning, as a foreign enterprise naturally want to try to increase the cost. Most of the practices of foreign enterprises, for example, could have purchased cheaper domestic components, but preferred to purchase foreign components of the same group, so as to increase costs, "fat water does not flow into the field of outsiders". I really cannot find any relevant law that can regulate this practice. Since the law does not stipulate that it is not allowed, it is naturally a "legal tax avoidance". In China, where tax evasion is more serious, legal tax avoidance is not really excessive.　　 At this point, it may be more useful for China to reflect on itself.