BUSINESS

Chinese Firms Need to Pivot Beyond Simple Sales Abroad, McKinsey China Chief Says

Published: Dec. 1, 2025 2:09 p.m. GMT+8

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Chinese businesses have entered “Globalization 3.0,” Joe Ngai says in an interview with Caixin on Thursday.

Chinese companies must evolve from mere product exporters into true global corporate citizens to succeed in the next phase of international expansion, according to McKinsey & Co.’s Greater China chairman.

Chinese businesses have entered “Globalization 3.0,” Joe Ngai said in an interview with Caixin on Thursday. This new era demands that firms move beyond simple transaction-based models — selling goods abroad — to establishing deep local roots, creating jobs, transferring technology, and sharing profits with international partners, he said.

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Chinese firms must shift from exporting products to becoming integrated global citizens through localization, job creation, and shared benefits.
Despite rapid overseas expansion, Chinese companies face compliance challenges, with less than 8% of revenue from abroad and only 12 brands in the global top 100.
Multinationals face tougher competition in China but are unlikely to exit, instead forming local partnerships and restructuring operations for agility.

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Who’s Who

Starbucks: Starbucks is mentioned as an example of a multinational corporation restructuring its operations in China. On November 4, Starbucks announced a partnership with Chinese alternative asset manager Boyu Capital. Boyu will acquire up to a 60% stake in a joint venture to operate Starbucks' business in mainland China, valued at $4 billion. Starbucks will retain a 40% stake and continue to license its brand.

Boyu Capital: Boyu Capital is a Chinese alternative asset manager. It partnered with Starbucks on November 4th, acquiring up to a 60% stake in a joint venture to operate Starbucks' business in mainland China. This deal valued the enterprise at $4 billion, with Starbucks retaining a 40% stake and brand licensing.

Yum China: Yum China spun off from its U.S. parent in 2016 to attract investment from Primavera Capital and Ant Group. This move by Yum China, along with similar restructurings by other major consumer brands, demonstrates a strategy of localization and securing local partnerships to thrive in the Chinese market.

Primavera Capital: In 2016, Primavera Capital participated in the investment restructuring of Yum China. Alongside Ant Group, Primavera Capital invested in Yum China when it spun off from its U.S. parent company. This move aimed to localize and secure investment for Yum China's operations.

Ant Group: Ant Group was part of a consortium that invested in Yum China in 2016. This move was part of a larger trend of strategic localization by Western giants, where foreign companies restructure to become more agile in the Chinese market, often by partnering with Chinese entities.

Citic Group: According to the article, Citic Group, as part of a consortium, acquired a controlling stake in McDonald's Chinese mainland and Hong Kong operations in 2017. This deal was valued at up to $2.08 billion and was a strategy that successfully revitalized McDonald's local presence.

McDonald's: In 2017, a consortium led by Citic acquired a controlling stake in McDonald's' Chinese mainland and Hong Kong operations. This deal, valued at up to $2.08 billion, successfully revitalized the fast-food giant's local presence. The move highlights a trend of strategic localization by Western giants in China.

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