1. #IMA15ACE How Chinese Capital Affects US Corporate Growth

2. Introduction

3. #IMA15ACE Introduction 3  FDI Strategies was established in 2013 by Eric Moraczewski to assist middle-market US corporations in taking advantage of available capital in China.

4. Available Capital

5. #IMA15ACE Available Capital - Acquisitions Capital has been moving out of China for a variety of reasons over the past several years, but in record numbers, in 2014 $102.9 Billion left in Outbound Direct Investment (ODI) 5

6. #IMA15ACE Available Capital - Buyers There has never been a better time to sell products in China. While average wages are still lower than established countries, the Movers & Shakers account for 10% of spending. 6 *Image from ChinaLuxCultureBiz

7. #IMA15ACE Available Capital 7

8. Affect on US Companies

9. #IMA15ACE Affect on US Companies 9 Rise of the Chinese Consumer Purchase of Foreign Goods Purchase of Foreign Companies New Demands on Quality and Diversity Travel

10. Will These Changes Continue?

11. #IMA15ACE Will These Changes Continue? 11 Change cannot last forever, where do you fit in the growth of an economy The Chinese economy saw 15% annual growth rates over the past 10-15 years, an obviously unsustainable rate. This allowed Chinese businesses to stay within their own borders. While MNC’s have been doing business in China for years, small and middle market companies are just now getting the opportunity to sell to China. Middle market companies are just beginning to look to grow outside the Chinese borders

12. How Can You Capitalize?

13. #IMA15ACE How Can You Capitalize? 13 Sell products to China Demand is rising quicker in certain sectors than others Approaching the market in the correct way Brand is still important Sell business to China Many Chinese firms have cash on hand and currently are paying 12-20 times earnings for Chinese businesses Demand for foreign goods and IP continue to grow Form a Joint Venture or License your technology In many cases this is the best immediate opportunity to take advantage of the Chinese market with lower initial risk

14. What are the drawbacks?

15. #IMA15ACE Drawbacks 15 Time Simply put, it takes longer to get a deal done with the Chinese Currency Challenges Moving money in and out of China “PEG’d” currency rates Poor International Relations US and China struggle to strike a long term deal

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