Slashdot Mirror

← Back to Stories (view on slashdot.org)

Blocked From US Tech Investing, China Goes To Israel Instead (cnet.com)

Posted by msmash on from the trump-effect dept.

Struggling to seal deals in the United States as regulatory scrutiny tightens, Chinese companies looking to invest in promising technology are finding a warmer welcome for their cash in Israel. From a report: Unfazed by this change, which was brought on in part by a new administration focused on US protectionism, Chinese investors are putting their money in Israeli companies instead. Last year, Chinese investment in Israel surged tenfold to $16.5 billion, a record, with money going to Israeli internet, cybersecurity and medical device companies. In contrast, Chinese investors scrapped a record $26.3 billion in previously announced US deals.

4 of 73 comments (clear)

  1. Contracts by psergiu · · Score: 5, Interesting

    I have dealt with Israeli companies before. Everything is fine as long as you pay very carefully attention to the wordings in the contracts. You need both legal and technical teams to go over each revision.
    Both their legal and technical teams are usually very good, and once the contract is signed, they keep their part of the agreement. To the letter.
    I wish the Chinese good luck.

    --
    1% APY, No fees, Online Bank https://captl1.co/2uIErYq Don't let your $$$ sit in a no-interest acct.
    1. Re:Contracts by ShanghaiBill · · Score: 5, Interesting

      Dealing with China is worse. First you sign the contract, then they start the negotiations.

      You are doing it wrong. Chinese courts are so biased and dysfunctional that written contracts are basically unenforceable. They are a waste of time. Instead have a written agreement in English, and put the money in an escrow account under American jurisdiction. When they deliver the product, and it meets the spec, you release the escrow funds. If they don't deliver as agreed, then their only option is to sue you in America to get their money. If they won't agree to these terms, then go back to Alibaba and spend 5 minutes finding an alternative supplier.

      Chinese don't even trust each other, so escrow payments are common, and every significant supplier is familiar with how they work.

    2. Re:Contracts by ShanghaiBill · · Score: 3, Interesting

      As opposed to where exactly? Every place on earth is like this.

      No they aren't. The level of shady business behavior in China is way beyond what you experience in America.

      That's why lawyers have jobs.

      Per capita, America has 20 times as many lawyers of China. In China, the courts are not effective at enforcing contracts, so lawyers aren't much help.

      There are plenty of stories about naive foreign companies trying to do business in China, but my favorite is when BAT (British American Tobacco) first entered the Chinese market. At first, they were surprised to see sales higher than expected. Sales continued to grow for several months, and they ramped up production. Then, after six months, sales plummeted to zero, and never recovered. They took huge losses on infrastructure and unsold merchandise. It took them a long time to figure out what happened. Their sales were high because their products were being purchased by their competitors, and stored in damp warehouses, where they grew stale and moldy. Then after six months, all the accumulated rotten cigarettes were dumped onto the wholesale market, crashing the price, and destroying BAT's reputation for quality.

  2. Re: Ok, who has the time machine? by ArmoredDragon · · Score: 3, Interesting

    Both the previous one and the current one are bad in this area (and for what it's worth, Bernie would be even worse than these two.)

    The thing is, mercantilism is a concept that has no merit whatsoever. Having a trade deficit can be perfectly healthy for an economy, and historically when countries attempt to correct a trade deficit, they just make things much worse for themselves. Things like tariffs end up costing you much more in the long term than they supposedly save in the short term. The steel tariffs for example cost our economy about $300,000 a year per job it supposedly saves.

    What this comes down to is two things:
    - Domestic production rises and falls almost in lock-step with imports
    - We're on a global economy. If we restrict our steel imports, then any domestic goods we produce that use steel will cost us more money to produce. Meanwhile, other countries that buy cheaper foreign (to them) steel can now undercut our goods that are produced using steel, which means that we then sell fewer of steel based goods.

    For what it's worth, practically all economists agree that tariffs and other trade barriers are bad for all parties involved.