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Xinyi Wu

Chinese firms should prioritise regional political stability when they make overseas investment decisions, as mounting geopolitical tensions and currency fluctuations increase the risks of doing business abroad, a prominent Chinese entrepreneur has warned.
“The current unrest in the Middle East, fluctuations of the US dollar and international complexities serve as a reminder for firms expanding abroad: we must go to locations that offer relative stability,” said Liu Yonghao, founder and chairman of agricultural conglomerate New Hope Group.
As one of China’s leading entrepreneurs and overseas investors, Liu has been driving New Hope Group’s global expansion for nearly 30 years. He is also a member of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), the country’s top political advisory body.
“It is better for us to invest more in places that we understand relatively well and where we can have a better grasp of the situation,” he added, speaking on the sidelines of the “two sessions” – the annual meetings of China’s top legislature and the CPPCC – in Beijing on Tuesday.
Liu said he favoured regions such as Southeast Asia, Australia and New Zealand – whose markets are comparatively more predictable and geographically distant from conflict zones.
His comments came as an increasing number of Chinese firms look to overseas markets for new growth opportunities and an escape from sluggish demand and intensifying competition at home.
But recent geopolitical developments – such as the escalating conflict in the Middle East and the US military intervention in Venezuela earlier this year – have heightened risk awareness and prompted more caution among investors.


Meanwhile, the recent softening of the US dollar – driven by policy uncertainty under the administration of US President Donald Trump – has added to the pressures faced by Chinese enterprises abroad.
Liu noted that yuan-denominated payments would help mitigate the risks of currency volatility, suggesting that having bilateral agreements with host countries to increase yuan liquidity could provide much-needed support for these firms.
China’s first private economy promotion law – passed last year – had boosted the standing of private firms, but more substantive support was still required to implement the measures in practice, he added.
Private firms – especially small and medium-sized enterprises – seek more equal treatment when it comes to financial policy, legal protections and the allocation of resources, according to Liu.
China’s private sector accounts for around 60 per cent of the country’s economy and 80 per cent of urban employment.
While Beijing’s focus on innovation has turned attention to younger companies in the tech sector, firms in traditional industries – like New Hope Group – are also tapping into digitisation and artificial intelligence to boost their productivity.
Liu said the transition would not happen overnight.
“I hope that while the government focuses on new hi-tech enterprises, it also extends support to traditional enterprises undergoing upgrading,” he said.
“After all, traditional industries provide plenty of employment opportunities and serve as the fundamental bedrock of China’s economy.”


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Escalating Middle East conflict, currency fluctuations make destinations like Southeast Asia, Australia attractive, top business leader says


Escalating Middle East conflict, currency fluctuations make destinations like Southeast Asia, Australia attractive, top business leader says.


Chinese firms should focus on investing in politically stable regions: entrepreneur

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Escalating Middle East conflict, currency fluctuations make destinations like Southeast Asia, Australia attractive, top business leader says

Escalating Middle East conflict, currency fluctuations make destinations like Southeast Asia, Australia attractive, top business leader says