Life will get even harder for foreign firms in China

In the spanBy Don Weinland of a few days in September 2023, word spread that two businessmen working for global firms were not permitted to leave China. One of them, the head of a Chinese investment-banking division at Nomura, a Japanese bank, appeared to have been snagged in a corruption investigation. He had been hit with an “exit ban”, meaning he could travel within the country but could not leave. Days later news broke that a senior executive at Kroll, a due-diligence firm, was subject to similar conditions. According to the , he has been stuck in China since July.Nearly a year into China’s reopening, after three years of isolation during the global pandemic, foreign executives are still trying to determine what the new normal is for doing business. Economic growth has petered out, making the market less appealing to global retailers. President Xi Jinping’s ideological support for Russia in its war against Ukraine has scared investors. Fund managers now demand higher returns to justify the increase in geopolitical risk; many are simply not earning enough and are allocating capital elsewhere.