Internationalization of Multinational Entreprises from North-East Asia

Abstract

Using the statistical data of international databases, this paper investigates evolution and structural changes in the current rankings of multinational enterprises from North-East Asia in 2000-2020. The authors aim to identify differences and similarities in the internationalization strategies and core competences of multinational enterprises from the region. The research outcomes clearly demonstrate that the role of North-East Asia in global outward foreign direct investment is expanding and multinational enterprises from this region, particularly from China, becomemore mature.While rapid increase in the number of Chinese multinational enterprises and their foreign expansion are causing major structural changes in international rankings, comparisons on transnationalism explicitly show that Japanese multinational enterprises and territories with small domestic markets, such as Hong Kong and Taiwan, have significantly higher levels of internationalization. The specific features of multinationals are pronounced in their original set of core competences, stages, methods and global context of internationalization. Nevertheless, there are similarities among these multinationals, such as their reliance on country-specific advantages comprised of comparative advantages and government-created advantages; centralized corporate structures built on strong connections with the government and personal and social informal networks; and relatively strong regional supply chains reflecting the high level of complementarity among almost all countries of the region. The research findings also highlight the fact that many emerging multinationals from the region have successfully nurtured their original firm-specific advantages. Further success of MNEs from NEA shall depend on their capabilities to cope with new challenges of the global context of their internationalization, namely, post-pandemic recovery, raising economic nationalism that gradually causing the disruption of conventional global value chains and the sustainability agenda of the world economy.