Chinese state investment firm to avoid US and look to Europe in pursuit of tech assets as trade row deepens
China Jianyin Investment is targeting robotics as a priority area as the country’s workforce ages
China Jianyin Investment, the equity investment group spun out from China Construction Bank, will avoid the US market in its pursuit of overseas technology acquisitions as trade tensions between the two countries increase.
Kenny He Wenjin, chief executive of JIC Investment, a unit of Jianyin that focuses on investment in manufacturing businesses, said Germany and other parts of Europe were now its key target markets.
“We will now avoid making deals in the United States,” he said. “JIC wants to be practical and we are looking for smart manufacturing assets abroad that can fit well with the Chinese market.
“It is not the transaction value that matters. We want to bring the world’s best technologies to China and meld them with China’s own manufacturers to make world-class products.”
Robotics is a priority for the company, he said, noting that China's working population – those aged between 16 and 59 – is likely to fall to about 700 million by 2050, down from the current 900 million-plus, according to the Ministry of Human Resources and Social Security.
The country is already the world’s largest robotics market, and is expected to have 1 million industrial robots in operation by 2025, up from about 300,000 in 2016, according to the International Federation of Robotics.
Chinese home appliance giant Midea Group bought German robot maker Kuka in 2016 for US$5 billion in one of the first such acquisitions.
“Overseas acquisitions is the right approach for China to take,” He said. “We need to assimilate core technologies and use them to address China’s ageing problem.”
In its annual report published on Tuesday, Jianyin said smart manufacturing appeared to be the top investment choice in 2018 because it was not only in line with the central government’s policy directions, but was low risk given China’s huge demand for automation and robotics.
In 2015, Beijing unveiled the “Made in China 2025” guideline, which reflected China’s ambitions of transforming into an advanced manufacturing powerhouse. Manufacturing accounted for about 30 per cent of the country’s total economic output last year.
The sizes of the funds under management by Jianyin Investment and its units are not publicly available.