Wahaha-haha,” an April 19th article in The Economist, shares the “lessons from Danone and HSBC’s troubled partnerships in China.” Danone and HSBC, like dozens of companies in every industry, entered the “geographically vast but promising market obscured by a thicket of complex and contradictory rules” with joint ventures – in these cases, large shares in Chinese firms in the food and banking industries. However, in recent days, the once-attractive arrangements, in which foreign capital was to combine with local expertise to profit from Chinese markets, face three challenges, according to the article. First, Chinese companies want investment, but do not want to “be mere adjuncts to foreign firms;” instead, they want to expand and develop with their own strategies. Second, murky investment and profit allocations left firms fighting. Third, conditions in China have changed: land and labor are no longer as readily available, the amount of domestic capital has increased, and the development of local markets has created a nationalistic economic sentiment.
.