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Straits Times
18 hours ago
- Business
- Straits Times
‘Go global or go bust': Chinese firms venture overseas, to regions like SEA, for greener pastures
Sign up now: Get ST's newsletters delivered to your inbox Singapore banks like DBS provide consultancy and financial services to Chinese firms thinking of expanding to SEA. - Amid a sluggish economic recovery and a simmering trade war with the United States that threatens to intensify, Chinese companies face a stark reality – go global or go bust. While going global before the Covid-19 pandemic of 2020-2023 was about chasing profits, for a growing number of Chinese companies, it's now about survival. At the China International Supply Chain Expo held in Beijing in mid-July, a common refrain among Chinese firms was 'bu chu hai jiu chu ju', which translates as 'if you don't go overseas, you're out of the game'. 'Certain sectors of China's market have undoubtedly hit a growth ceiling or are very 'juǎn',' said Mr Chen Yideng, China director at Brand Finance, a London-based firm that ranks and values global brands. Juǎn (literally 'to roll up') is a Chinese term that refers to intense competition , also known as 'involution' . He told The Straits Times that intensifying competition at home has driven up costs, squeezing profit margins for many firms. 'Going overseas is the most direct strategic choice for Chinese companies in search of new growth engines,' he said. China's economy enjoyed roaring growth from the 1990s, but began to slow after the 2008 global financial crisis, reaching just 5.2 per cent in 2024. The World Bank in June projected China's growth to slow to 4.5 per cent in 2025. The international expansion of Chinese companies – known as 'chu hai' (literally 'going out to sea') – is not new. 1978 marked the first year Chinese companies , specifically state-owned enterprises, were permitted by the government to invest abroad. What's new is the noticeably faster pace since the Covid-19 pandemic, with smaller firms increasingly joining a trend once dominated by larger corporations. For many of these smaller companies, South-east Asia's geographical proximity and emerging markets make it the most feasible destination to begin their expansion. In this foray, Singapore serves as an ideal location for regional headquarters, acting as a bridge between China and the rest of South-east Asia. The nature of Chinese firms' overseas expansion has also evolved in the past two decades – from merely exporting goods made at home, to establishing factories, regional headquarters and supply chains abroad. China's outbound investment flows are surging from already record levels. According to government data , outbound direct investment (ODI) in 2024 reached 1.16 trillion yuan (S$207.7 billion), an 11.3 per cent increase year-on-year. China has ranked among the top three sources of outbound investment, behind the US and Japan, for 12 consecutive years. Chinese firms seeking to expand overseas got a boost in 2000 when the government started its 'go out' policy amid a stagnating domestic market and China joined the World Trade Organisation. In 2013, the government's Belt and Road Initiative to alleviate industrial overcapacity and increase the country's global influence spurred infrastructure projects overseas led by state-owned firms. Also in the 2010s, Chinese private firms began expanding overseas as domestic competition intensified. SMEs dominate post-Covid wave Companies that offer consultancy and support services to Chinese firms with global aspirations tell ST that a new wave began during the pandemic, when lockdowns disrupted domestic production and government crackdowns on property and other parts of the private economy dampened business confidence at home. It also comes as Mr Donald Trump's return to the White House gave Chinese firms more urgency to diversify their operations to avoid being caught off guard in an unpredictable global trade environment. In this sense, their overseas expansion mirrors the 'China plus one strategy' adopted from 2013 by multinationals seeking to reduce their China exposure. 'Pre-covid, most of those who came out are the big boys,' said Mr Ho Kah Chuan, CEO of Go Global Gem, a Singapore consultancy. He was referring to state-backed behemoths like the China National Petroleum Corporation. He noted that during and post-Covid, many high net-worth Chinese who experienced strict lockdown left China to set up family offices in Singapore to diversify their businesses and mitigate risk. 'Now with the trade war, and with Trump slapping high tariffs, we are seeing all kinds of businesses, even small and medium-sized companies, that want to re-examine their supply chains,' he told ST. Since 2020, the government has given financial support for overseas expansion to small and medium-sized firms recognised as 'Little Giants' for being specialised, sophisticated, distinctive and innovative. Hrunan, a Beijing-based provider of smart water solutions for flood management and irrigation, is one company that has benefited from this scheme. Since embarking on its first overseas project in Uzbekistan three years ago, the company has seen its global operations contribute to one-third of its total turnover. Now, it is exploring the possibility of setting up its regional headquarters in Singapore to better attract and serve clients in Vietnam, Cambodia, Indonesia and Malaysia. ST spoke to about 20 Chinese companies at the Supply Chain Expo. Many say South-east Asia is a key destination for both markets and manufacturing bases, with Singapore standing out as the top choice for their regional headquarters. One attraction is the region's growth potential. DBS Bank estimates that from 2024 to 2034, the six largest Asean economies will grow at an average annual rate of 5.1 per cent, faster than their average in the previous decade. Close commercial and political ties are another draw. China is already a key trade and investment partner for nearly all South-east Asian countries. Many governments in the region are also politically friendly to China, presenting lower geopolitical risks than in the US. South-east Asia is also relatively peaceful and stable, compared with regions like the Middle East, making it a safer destination for long-term investment in factories. In addition, the region has a young and growing population of both workers and consumers. Another major factor is that Chinese products and services, honed through intense domestic competition, are at least a generation ahead in manufacturing and technology than those in South-east Asia. They are also cheaper than other global competitors. A CATL Naxtra battery is seen at a CATL booth during the China International Supply Chain Expo (CISCE) in Beijing on July 16. PHOTO: AFP Ms Ma Li, overseas business manager of Hrunan, said that after 22 years of missteps and refinement in China, her company's products and solutions are now sufficiently sophisticated, giving the company the confidence to finally expand abroad. 'For example, for a water valve that spans a canal as wide as the Singapore River at Boat Quay, we can build one that costs 30 to 40 per cent cheaper than what a European or American company would charge. We can also deliver it within a month, faster than our Japanese competitors,' she said. Singapore as bridge for Chinese SMEs going overseas Chinese companies say they like Singapore as their regional headquarters because they feel more at ease dealing with Mandarin speakers in the Republic. They also appreciate Singapore's strong connectivity with South-east Asia, pro-business environment, friendly tax regime and transparent legal system. This has led to a proliferation of professional service firms in Singapore that support Chinese firms with global ambitions. The services they provide include consulting, legal advice, tax, technology and recruitment. Mr Ho, who has worked close to 10 years in the Singapore public sector, set up Go Global Gem in 2021 to ride the wave of Chinese companies going overseas. 'Each of the 10 or 11 Asean countries has different tax structures and laws. Chinese companies need help to figure out how to avoid legal infringements and how to structure their business model such that they don't have to pay more tax than they need to.' He observed that as the trade war disrupts supply chains, companies that previously operated only in China will now need to do so across multiple countries and will value professional advice to navigate shifting policies. For example, one of his clients, a home appliance company based in the Chinese city of Ningbo, already has a factory in Vietnam. When Mr Trump imposed a 46 per cent tariff on Vietnam in April, the firm began considering setting up an international headquarters in Singapore and another factory in Malaysia or Thailand. Now that Mr Trump announced in July that he has reached a deal with Vietnam—slashing the tariff rate to 20 per cent but imposing a 40 per cent transshipment tax—the firm will have to re-evaluate its options. Professional services providers are especially useful to smaller Chinese firms that previously held back from expanding overseas due to limited scale, foreign exposure and in-house capabilities. An example is Helport , a Singapore-based firm founded by Chinese technopreneurs that provides AI-enabled call-centre services. Its clients can subscribe to its service to avoid the hassle of hiring and training their own customer service and sales staff. 'When small Chinese companies go overseas, they often don't know who to turn to and where to get what they want. We help to lower the bar that Chinese companies need to jump over to go overseas,' its CEO Li Guanghai told ST. Reflecting on the intense competition in the Chinese economy, Mr Li said: 'The cake used to be so big, it is now so small. Five hundred people are now fighting over what used to be fought over by only 50 people. It's too tough to only stay in China.' 'I think this wave of Chinese firms going overseas that started since the pandemic will go on for N more years. This is the big trend and there's no turning back,' he said.
Gulf Business
a day ago
- Business
- Gulf Business
PIF tops the world: Saudi's sovereign fund declared most valuable brand
Image courtesy: PIF The Public Investment Fund (PIF) has once again been named the world's most valuable sovereign wealth fund (SWF) brand, according to the latest rankings by Brand Finance, a leading independent brand valuation consultancy. In its 2025 edition of The Asset Management and Sovereign Wealth Fund 50, released on July 28, Brand Finance valued PIF's brand at $1.2bn, an 11 per cent increase from 2024. This marks the second consecutive year PIF has claimed the top spot globally, Read- With an A+ brand strength rating and a brand strength index score of 62.9 out of 100, up from the previous year, PIF continues to outperform global peers in both reputation and performance. Its brand strength surpasses the average for SWFs worldwide, reinforcing its leadership in the sector. Sports partnerships fuel visibility PIF was the only SWF to appear in the top 10 rankings for brand value to assets under management (AuM) ratio, placing seventh among all asset management and SWF brands. The fund's AuM has seen strong growth, attributed to robust returns from key portfolio companies and long-term investments nearing maturity. Brand Finance highlighted PIF's expanding portfolio of high-profile sports sponsorships, including partnerships with ATP and WTA tennis, Formula E, Extreme E, and ownership of LIV Golf, as key drivers of its brand value. These initiatives fall under the fund's E360 sports investment platform. 'Formula 1 and football are powerful ways for sovereign wealth funds to elevate their global profile,' said David Haigh, chairman and CEO of Brand Finance. 'PIF's investments continue to enhance awareness and strengthen its international reputation.'
Zawya
a day ago
- Business
- Zawya
PIF ranks as world's most valuable and fastest-growing sovereign wealth brand in 2025
RIYADH — The Public Investment Fund (PIF) has been ranked as the world's most valuable and fastest-growing sovereign wealth fund brand for 2025, according to leading brand valuation consultancy Brand Finance. It marks the second consecutive year the Saudi sovereign wealth fund tops the global list. PIF's brand was valued at $1.2 billion this year, an 11% increase compared to 2024. The fund received an A+ brand strength rating, placing it second globally with a score of 62.9, and seventh in terms of assets under management (AUM) relative to brand value — the only sovereign fund to rank in the top ten in that category. According to Brand Finance's annual report on sovereign wealth funds and asset managers, PIF achieved the fastest brand growth rate in 2025. The report credits this momentum to PIF's expanding asset base, positive performance of Saudi portfolio companies, and the maturation of key projects. The fund's communications efforts and commitment to creating long-term impact also contributed to its brand strength. The Brand Finance ranking, launched in 2024, aims to help organizations understand the value of their brand and how it contributes to overall business performance. It evaluates brand strength based on stakeholder perceptions, financial outcomes, and non-financial benefits such as attracting investment, talent, or media attention. David Haigh, CEO of Brand Finance, said PIF exemplifies the branding power of high-impact investments, particularly in international sports. 'PIF stands out through major initiatives such as its transformation of Newcastle United into a competitive football club, as well as sponsorships in golf, tennis, and electric motor racing,' Haigh said. PIF continues to focus on achieving its strategic goals of generating sustainable returns and driving economic transformation in Saudi Arabia. It is also among the most influential global investors in shaping future economic sectors. In addition to its brand recognition, PIF ranked first globally in governance, sustainability, and resilience (GSR) performance and commitment, sharing the top spot with a 100% score among 200 sovereign investors in a 2025 report by Global SWF. The fund holds strong credit ratings, with Moody's assigning it an 'Aa3' with a stable outlook, and Fitch giving it an 'A+' rating, also with a stable outlook. © Copyright 2022 The Saudi Gazette. All Rights Reserved. Provided by SyndiGate Media Inc. (
Asharq Al-Awsat
a day ago
- Business
- Asharq Al-Awsat
Saudi Arabia's PIF Tops Global Sovereign Wealth Funds in Brand Value for 2nd Consecutive Year
Brand Finance, a leading global brand valuation consultancy, announced on Monday that Saudi Arabia's Public Investment Fund (PIF) has once again topped the list of the world's most valuable and fastest-growing sovereign wealth funds for 2025, with a brand value of $1.2 billion, reflecting an 11% increase compared to 2024. According to Brand Finance's annual report, which evaluates the largest sovereign wealth funds and asset management brands, PIF earned an A+ rating for brand strength and ranked second globally with a score of 62.9. It also placed seventh in brand value relative to assets under management (AUM), standing out as the only sovereign wealth fund among the top 10 on this index. The report highlighted PIF's brand as the fastest-growing among global sovereign wealth funds in 2025, attributing this growth to several key achievements. These include the consistent expansion of its AUM, driven by the strong performance of Saudi companies and the maturation of projects aligned with the Kingdom's Vision 2030. Furthermore, the fund's proactive efforts to raise awareness of its initiatives and its unwavering commitment to sustainable growth and impact have bolstered its brand performance. Brand valuation encompasses assessing the effectiveness of brand performance and its influence on stakeholder behavior and financial outcomes, both directly and indirectly. This includes attracting investors and securing funding, recruiting and retaining talent, and generating positive media coverage. Brand Finance Chairman and CEO David Haigh underlined the significant role of impact investments in boosting brand awareness and reputation, particularly on the international sports stage. He stated that the PIF stands out through several notable examples, most prominently through its investment in Newcastle United, transforming the club into a competitive, title-winning team. Additionally, the fund's sponsorships in globally renowned sports such as golf, tennis, and electric motor racing further elevate its brand presence. The PIF focuses on pursuing its strategic goals to drive positive economic impact within the Kingdom and ensure sustainable returns. It is recognized as one of the world's most influential investors and actively fosters new sectors and opportunities that shape the global economy while accelerating economic transformation in Saudi Arabia. According to a Global SWF report, the fund jointly ranked first worldwide for compliance and performance in governance, sustainability, and resilience (GSR) standards, achieving a 100% compliance rate by 2025 among 200 sovereign investors. It holds an Aa3 credit rating with a stable outlook from Moody's and an A+ rating with a stable outlook from Fitch Ratings, underscoring its strong financial standing.
Business Wire
a day ago
- Business
- Business Wire
New Brand Finance Ranking: PIF and BlackRock Stay on Top as World's Most Valuable Sovereign Wealth Fund and Asset Management Brands
LONDON--(BUSINESS WIRE)-- BlackRock is the world's most valuable asset management (AM) brand with a value of USD8.3 billion, and PIF is the most valuable and fastest-growing sovereign wealth fund (SWF) brand, according to data from Brand Finance, the world's leading independent brand valuation consultancy. The collective value of the top 50 brands grew 5% year on year, to USD73.9 billion in 2025. BlackRock's brand value has risen 17%, driven by a surge in assets under management, strategic acquisitions in private markets, and leadership in technology and AI. PIF is the most valuable SWF brand, (up 11% to USD1.2 billion). It also ranked seventh for brand value to AUM ratio among all AM and SWF brands, the only SWF to feature in the top 10. PIF's AUM have grown due to robust portfolio performance, driven by a range of key portfolio companies and maturing long-term projects. J.P. Morgan Asset Management ranks as second most valuable AM brand (up 3% to USD7.2 billion) and leads AM and SWF brands in brand strength with a Brand Strength Index (BSI) score of 87.6/100 (AAA). Vanguard (USD6.0 billion) is third most valuable. The Abu Dhabi Investment Authority (ADIA) is the strongest SWF by BSI, scoring 64.1/100 (A+). PIF is the second strongest AM brand, scoring 62.9/100 (A+). David Haigh, Chairman and CEO of Brand Finance, commented: ' high-profile investments with a positive impact continue to build the brand values of asset managers and sovereign wealth funds. This is evident in the impact of successful sports partnerships, which deliver an observable uplift in awareness and familiarity among B2B and informed audience. Formula 1 and football are powerful and popular ways for asset managers and sovereign wealth funds to raise their international profiles in a way that is consistent with the brands' wealth and stature.' Note to Editors The full ranking, insights, methodology, and definitions of key terms are available in the Brand Finance Asset Management & Sovereign Wealth Fund 50 2025 report. Brand Finance is the world's leading brand valuation consultancy.
