How going global can go well for firms

Xia said his company's projects in Angola were robbed by armed gunmen many times, which not only jeopardized the project's progress but also raised concerns over employees' safety.

The company's turnover in the African market reached about $300 million in November, compared with $583 million in 2012.

Xia added that an even bigger pressure came from inside the Chinese enterprises.

"Many Chinese enterprises took on overseas business as a temporary plan and then ran into difficulty in merging their management system with that of the local cultures," he said.

"We know how to train local labor forces, as we started our overseas business a long time ago, but in many projects, we are not clear about the regulations of the host countries. This will increase the costs for Chinese enterprises," Xia said.

He said that the company's Chinese workers in African projects dropped from 80 percent in 2008 to about 50 percent this year.

One reason for this, he said, is because the company has trained many local workers.

"In addition, the prospect of working on overseas projects is losing its luster as wages rise at home. China's labor advantage is reducing amid declining labor supply."

Now, labor agencies help the company get Vietnamese and North Korean workers for overseas projects, he said.

The upgrading of global construction chains also has posed challenges for Chinese businesses.

"Compared with Western companies, we are less advantageous in the design and planning work during the early stages of project contracting," Xia said, calling it a growing problem that challenges the company's control of overall project costs.

"We plan to merge some design institutions as a next step," he said.

There are several things the Chinese government can do to assist Chinese enterprises in truly going global, he said.

For one thing, enterprises should be legalized in host countries and employees localized, setting the foundation for more project bids in the future and changing the perception in many countries that Chinese companies come for quick money rather than long-term development.

"What's more, Chinese enterprises have acquired valuable assets in host countries," he said, citing 400 million yuan ($65.9 million) in assets in Angola. "It will be a loss if we have to sell them in the future. The government should improve its strict control over overseas spending and introduce localized management of overseas assets, which will boost the economic development of host countries as well as broaden the prospect of China's overseas business," Xia said.

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