Transnational Business: Changes in the Balance of Power

The article explores most recent shifts in the activities of transnational corporations, changes in the nationality of TNCs dominating the world economy in the 2010s – 2020s. One of the main shifts was the growth of the international activities of Chinese corporations. In 2013 China appeared in international production structures as a host country while the relative share of corporations originating from China in international production was small. But in the 2020s they took the first roles. The foreign assets of Chinese firms grew much faster than the assets of the entire group of major TNCs. Nonetheless, in terms of the degree of transnationalization, Chinese firms are significantly behind the US ones, so they still have the potential to expand international activity. Foreign assets of the largest US corporations declined. Some of them turned to re-shoring and concentrated on the domestic market. Among automotive companies, Japanese maintained their leadership. Foreign assets of American corporations remained almost unchanged in the automotive industry and declined in the production of electrical and electronic equipment. At the same time, in the sector of information and communication technology the US firms are still dominating. They are controlling about 1/3 of foreign sales and about ¼ of foreign assets of the top 100 firms producing hardware infrastructure. Their share in the foreign sales in digital services is almost 4/5, and in the foreign assets almost 2/3. China is in the group of leaders, but lags behind Japan in foreign assets as well, and in hardware production – from Germany and Taiwan. As international tensions intensify, Western countries are seeking to limit the expansion of Chinese corporations. Not only the United States but the European countries are imposing administrative restrictions to constrain the widening influence of the Chinese business. These restrictions can slow down the growth of impact of Chinese corporations, but they are unlikely to stop it. Counteraction in high-tech industries will be especially significant.