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Firm entry modes and Chinese business networks: Malaysian investments in Vietnam
Author(s) -
Lim Guanie
Publication year - 2016
Publication title -
singapore journal of tropical geography
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.538
H-Index - 42
eISSN - 1467-9493
pISSN - 0129-7619
DOI - 10.1111/sjtg.12133
Subject(s) - vietnamese , subsidiary , business , ethnic chinese , china , multinational corporation , finance , political science , philosophy , linguistics , law
This paper examines the Malaysian Chinese firms that have expanded into Vietnam. Based on research and qualitative personal interviews with Malaysian Chinese firms that have invested in Vietnam, the paper unpacks the entry modes that these firms have undertaken. It argues that the Malaysian Chinese firms prefer joint ventures in their Vietnamese businesses to wholly‐owned subsidiaries and personal direct investments. This paper also argues that such investments are often embedded in social and intraethnic ties, which connect Malaysian Chinese firms with Vietnam's ethnic Chinese businessmen. To this end, these firms tend to rely on informal ties and nonmarket institutions in the form of the ethnic Chinese business networks. Nevertheless, the Malaysian Chinese firms are not averse to collaborating with nonethnic Chinese firms that enjoy a good relationship with the Vietnamese state. This observation is especially marked in the property and construction, and finance sectors.