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Introduction
The past two decades have witnessed rapid growth and remarkable transformation in emerging economies. According to the World Investment Report 2005 (UNCTAD, 2005: 34), of the top six most attractive global business locations five are emerging economies (China, India, Russia, Brazil, and Mexico). Unlike the early path of internationalization for multinational enterprises (MNEs) from advanced markets (e.g., US, Europe and Japan) and newly industrialized economies (e.g., Korea, Singapore, Hong Kong and Taiwan), emerging economy enterprises have benefited tremendously from inward internationalization at home by cooperating (via original equipment manufacturing (OEM) and joint venture in particular) with global players who have transferred technological and organizational skills, allowing emerging market enterprises to undertake outward internationalization later in some unconventional ways. Although developed country MNEs remain the major source of outward foreign direct investment (FDI) today, outflows from developing and emerging economy MNEs have significantly risen, from a negligible amount in the early 1980s to $83 billion in 2004, or 11% in world stock, with active engagement in a large number of cross-border mergers and acquisitions (UNCTAD, 2005: 8).
In this article, we present an overarching framework that analyzes the uniqueness of emerging market multinational corporations (EM MNEs), including their rationale and motives, activities and strategies, propelling and facilitating forces, as well as risks and challenges in the course of international expansion. At the core of this framework is our argument that EM MNEs use outward investments as a springboard to acquire strategic assets needed to compete more effectively against global rivals and to avoid the institutional and market constraints they face at home. Their 'springboard' behaviors are often characterized by overcoming their latecomer disadvantage in the global stage via a series of aggressive, risk-taking measures by proactively acquiring or buying critical assets from mature MNEs to compensate for their competitive weaknesses. They are often not path dependent nor evolutionary in selecting entry modes and project location. Instead, their investments abroad could be attributed to several pressures, such as late-mover position, strong presence of global rivals in their backyard, quick changes in technological and product development, and domestic institutional constraints. At the same time, their 'springboard' approach is encouraged by their respective home governments, the willingness of global players in advanced countries to sell or share strategic...