“Belt and Road Initiative”, Globalization and Institutional Changes: Implications for Firms in Asia

Special Issue Editors:

Jiatao Li (The Hong Kong University of Science and Technology, mnjtli@ust.hk)

Gongming Qian (The Chinese University of Hong Kong, qian@baf.cuhk.edu.hk)

Kevin Zhou (The University of Hong Kong, kevinz@ hku.hk)

Jane Lu (CEIBS, janelu@ceibs.edu)

 

Submission deadline:  September 1, 2019

First author notification:  October 1, 2019

Special issue workshop:  December 18-19, 2019

Tentative publication date:      2020

Introduction

In recent years, the world economy has witnessed repeated trials of strength between globalization and de-globalization (e.g., Cuervo-Cazurra, Mudambi & Pedersen, 2017; Prashantham, Eranova & Couper, 2018). On the one hand, the Trump administration launched the United States on a protectionist course by stating that “Protection will lead to great prosperity and strength.” On the other hand, China leader Xi Jinping called for globalization; he declared: “Pursuing protectionism is like locking oneself in a dark room. While wind and rain may be kept outside, that dark room will also block light and air” (World Economic Forum, 2017). Ironically, China has long been known as a protectionist and isolationist economy even after it joined WTO in early 2000s while the US as a free and open one following its victory in the Second World War. It seems the US and China, the two largest economies in the world, changed their position on global economic order. Actually, China launched its new national policy on economic globalization known as the “Belt and Road Initiative” (BRI) in 2013, which is different from the “go out” policy adopted in China by the end of 1990s. Although this initiative has a short history, it has provided fertile soil for observing how it facilitates and promotes the new wave of globalization (Li, Liu & Qian, 2019).

Trials of Strength between Globalization and De-globalization

Globalization can be both a description and a prescription (Chehade, 2016). As a description, “globalization” refers to the widening and deepening of the international flows of technology, capital, trade and information within a single integrated global market. As a prescription, “globalization” entails the liberalization of national and international markets in the belief that the free flow of goods, capital and information will lead to economic growth and increased human welfare. Trump has argued for protectionism and asserted that decades of free-trade policies were responsible for the collapse of the American manufacturing industry by, for example, bringing cheap consumer goods into the country, costing domestic jobs and depressing wages (Allen, 2016). Similarly, support for Brexit came in large part from those worried about their jobs and the entry of immigrants. To roll back economic globalization, Trump signed an executive order to withdraw from Trans-Pacific Partnership (TPP), a U.S.-led free trade pact. He also signed an executive order to renegotiate, or even scrap, the North American Free Trade Agreement (NAFTA). Other global trade deals are also now very much in doubt, notably the agreement being negotiated between the US and Europe, known as the Transatlantic Trade and Investment Partnership (TTIP) (Allen, 2016). Further, the Trump administration threatened to slap taxes on U.S. companies (MNEs) investing overseas, raise tariffs to discourage companies from offshoring production and jobs, and introduce border taxes that penalize imports relative to exports, or both (Smith, 2017).

With a parallel development, the Trump administration’s withdrawal from the TPP gives China the opportunity to strengthen its position in the region (Smith, 2017). Beijing has been positively pushing its own regional free-trade pacts which include both the Free Trade Area of the Asia Pacific (FTAAP) and the Regional Comprehensive Economic Partnership (RCEP), which some observers see as competitors to the TPP. At the same time, China has been advocating its development strategy and framework known as “BRI” which focuses on connectivity and cooperation among countries primarily between itself and the rest of Eurasia (Li, Liu & Qian, 2019). The BRI has already attracted over 100 countries and international organizations to join, and enjoyed wider support from Beijing-led Asian Infrastructure Investment Bank (AIIB).

These changes derived in this new international business environment will affect many parameters of strategy, institution, new venture creation, and supporting business activities such as resource allocation and investment selection. The new environment challenges how businesses are organized and governed. Academic research, however, has yet to explain how firms can navigate the new international business environment. MNEs and entrepreneurs alike must account for these developments in terms of their plans and strategies in the coming years.

The APJM Special Issue seeks to provide an assessment of new challenges under rapidly changing international environments, and firm’s strategic responses toward the coexistence of globalization (e.g., BRI) and de-globalization (e.g., protectionism). We want to generate new insights on the change in the new business landscape and what new theory and evidence are needed to better elucidate this new environment. New theoretical perspectives, empirical evidences, and novel case studies can help identify the driving and inhibiting forces behind strategic responses in the new business landscape, and how firms and industries can adapt to and benefit from this dynamic environment.

We welcome both theoretical and empirical contributions, and papers that address the FDI and international strategy issues relating to the new global business landscape. We offer a few questions below to provide a sense of what the SI seeks to address. These questions are illustrative at best and not intended to set boundaries in terms of the key themes of interest.

Sample Topics

1. How do national strategies, for example, the Belt and Road Initiative of China, help their firms open up new avenues and adapt to rapidly changing international environments?
2. How could Asian firms utilize institutional or government-specific factors (at the country level) to deal with the coexistence of globalization and de-globalization challenges?
3. What strategic options are available for Asian firms to maintain sustainable development within the highly dynamic institutional environment?
4. In a new environment of world-wide protectionism, both domestic firms and MNEs will be confronted with fierce industrial competition and/or even “industrial wars”. How could firms address such challenges? 
5. How could developed economy MNEs manage their operations in Asia? How would such strategic moves or decisions (e.g., harvesting and divestment) affect their competitive advantage in the host countries? What strategies can help them sustain the scale and scope in Asia?
6. How could Asian MNEs deal with the institutional pressure from the Trump administration? Should they move directly into the U.S. market to create new demand and increase sales? For firms that already operate there, should they continue their investment (reinvestment) even though it may not produce profits?
7. How could Asian firms use M&A and/or strategic alliances to collaborate with Chinese counterparts in jointly developing their business operations along the “Belt and Road” routes?

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Submission Process and Deadlines

* All manuscripts will be reviewed as a cohort for this special issue. Manuscripts must be submitted by September 1, 2019.

* For informal inquires related to the Special Issue, proposed topics and potential fit with the Special Issue objectives, please contact the guest editors.

* For those authors who have submitted the papers to the normal manuscript issues, one option is to remove your prior submission and then submit the paper again selecting the Special Issue on the author system. If you do not want to do so, please send a message to the editor office to indicate your intention for this SI.

APJM Special Issue Workshop

All authors who are invited to revise and resubmit their manuscripts are expected to present their papers at an APJM Special Issue workshop to be held at Xiamen University, China, in December 18-19, 2019. The special issue editors and APJM editorial board members will provide developmental feedback to paper presentations during the workshop to enhance the quality and contribution of papers in order to maximize the impact of the SI. But presentation at the workshop does not guarantee acceptance of a paper for publication in APJM and attending the workshop is not a precondition for acceptance into the Special Issue.

References

Allen, K. 2016. Trump’s economic policies: protectionism, low taxes and coal mines https://www.theguardian.com/.../trumps-economic-policies-protectionism-low-taxes-and-coal-mines

Chehade, G. (2016). Could Trump be the end of economic globalization? Asian Times, (November 18, 2016). www.atimes.com/trump-end-economic-globalization/

Cuervo-Cazurra, A., Mudambi, R., & Pedersen, T. 2017. Globalization: Rising skepticism. Global Strategy Journal, 7: 155-158.

Li, J., Liu, B., & Qian, G. 2019. The belt and road initiative, cultural friction and ethnicity: Their effects on the export performance of SMEs in China. Journal of World Business, DOI: https://doi.org/10.1016/j.jwb.2019.04.004.

Prashantham, S., Eranova, M., & Couper, C. 2018. Globalization, entrepreneurship and paradox thinking. Asia Pacific Journal of Management, 35(1): 1-9.

Smith, D. 2017. Trump withdraws from Trans-Pacific partnership amid flurry of orders. The Guardian.

World Economic Forum. (2017). President Xi’s speech to Davos in full. Global Agenda, China, Economy. Retrieved from https://www.weforum.org/agenda/2017/01/full-text-of-xi-jinping-keynote-at-the-world-economic-forum.

Special Issue Editors:

Jiatao Li

Prof. Li is the Lee Quo Wei Professor of Business, and Chair Professor of Management, Hong Kong University of Science and Technology. He is an elected Fellow of the Academy of International Business (AIB). Prof. Li is a leading expert on global business strategy. His current research interests are in the area of organizational learning, strategic alliances, corporate governance, innovation, and entrepreneurship, with a focus on issues related to global firms and those from emerging economies. His work has appeared in leading academic journals such as Academy of Management Journal, Academy of Management Review, Organization Science, Strategic Management Journal, Journal of Management, and Journal of International Business Studies. He has served as an Associate Editor of the Strategic Management Journal from 2009 to 2016. He currently serves as Editor of the Journal of International Business Studies for 2016-2022, responsible for research related to strategy and policy in emerging economies. He is also on the editorial boards of the Academy of Management Journal, Strategic Management Journal, Global Strategy Journal, Journal of Management, and Long Range Planning. He served as Program Chair of the 2018 Academy of International Business annual conference in the US. 

Gongming Qian

(The Chinese University of Hong Kong, qian@baf.cuhk.edu.hk)

Prof. Qian is full professor and department chair, Southern University of Science and Technology, and former Chair of the Department of Management at The Chinese University of Hong Kong. He received his Ph.D. in International Business/Management from Lancaster University, England. His research interests include the financial economics of multinational enterprises and foreign direct investment, international strategy, and entrepreneurship. He has published widely in peer reviewed academic journals including Entrepreneurship Theory and Practice, Journal of Business Venturing, Journal of International Business Studies, and Strategic Management Journal. He has co-edited and is co-editing a Journal of International Business Studies special issue, a Journal of Management Studies special issue, an Entrepreneurship Theory and Practice special issue, and a Journal of International Business Policy special issue published and to be published in 2018, 2019, 2020 and 2021, respectively. He serves on the editorial board of Journal of International Business Studies.

Kevin Zhou

(The University of Hong Kong, kevinz@hku.hk)

Prof. Kevin Zhou is Chang-Jiang Scholar Chair Professor, Chair Professor of Strategy/International Business at Faculty of Business and Economics, University of Hong Kong. Prof. Zhou’s research interests include capabilities and innovation, trust and relational ties, and strategic issues in emerging economies. Prof. Zhou has published numerous papers in prestigious journals such as Administrative Science Quarterly, Academy of Management Journal, Strategic Management Journal, Journal of Marketing, Journal of International Business Studies, Organization Science, and among others. His work is highly influential and well cited: He has been the World’s Top 1% cited scholars based on ISI's Essential Science Indicators (ESI) since 2011 and has been the World’s Highly Cited Scientific Researchers since 2016.

Jane Lu

(China Europe International Business School, janelu@ceibs.edu)

Prof. Jane Lu is Parkland Chair Professor of Strategy at China Europe International Business School, while on leave from her role as James Riady Chair in Asian Business and Economics in the Department of Management and Marketing, the University of Melbourne. She is currently the Editor-in-Chief of Asia Pacific Journal of Management. Jane’s research centers on international strategy such as internationalization, entry mode choice and alliance partner selection. Her recent research continues this line of research but with a focus on emerging market firms and their internationalization. Jane Lu has published in leading academic journals such as Administrative Science Quarterly, Academy of Management Journal, Strategic Management Journal, Journal of International Business Studies, Journal of Management and Journal of Business Venturing, among other journals.