Multinationals Chinese multinational company

Tomas Koch of McKinsey uses the specialty chemical market as an example Chinese producers increasingly supply the multinational companies that are moving plants [into China] and then dropping their traditional suppliers. They switch almost as soon as an adequate local source becomes available... Since rising imports to meet growing domestic demand will eventually draw Chinese entrepreneurs with low cost bases into the market for just about all chemicals, any decision to serve the country from faraway plants may be risky. ... 

Intemational optimism surrounding the growth of China s economy has attracted interest in its biopharmaceutical sector. Recent years have seen the establishment of a large number of domestic pharmaceutical companies as well as an influx of multinationals. A ccordingtoBCG Analysis 2002, China is expected to become the fifth largest pharmaceutical market in the world by 2010. Companies such as Roche and Eli Lilly have set up R D centers in the country and others have outsourced their R D work to Chinese enterprises. 

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