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(Bloomberg) -- International Business Machines Corp. is shutting a key research division in China in a move affecting more than 1,000 employees, local media including Yicai reported, in the latest pullback by a US name from the world’s No. 2 economy. Most Read from Bloomberg Sydney Central Train Station Is Now an Architectural Destination Chicago Overcomes DNC Skeptics With Calm, Parties and Sun Nazi Bunker’s Leafy Makeover Turns Ugly Past Into Urban Eyecatcher How the Cortiços of São Paulo Helped Shelter South America’s Largest City With Housing Costs High, Democrats Hone YIMBY Message The company is shuttering two business lines that specialize in research & development and testing, Yicai reported, citing an IBM statement. It will instead turn toward serving private enterprises and select multinationals operating in China going forward, Yicai added.
IBM joins a growing list of companies scaling back their ambitions for China as an economic downturn, heightened regulatory scrutiny and a drive to replace foreign technology depress sentiment. Wall Street names such as Morgan Stanley have shifted some operations abroad, while foreign investment has slowed partly because of concerns Beijing is favoring local players. Tech is a particularly sensitive arena given the US and China are locked in a conflict over crucial spheres from semiconductors to artificial intelligence. Beijing is trying to foster the growth of national champions such as Huawei Technologies Co., worried that restrictions on US technology will hamper the country’s longer-term prospects and curtail its geopolitical clout. IBM plans to move its Chinese R&D functions to offices elsewhere, the Wall Street Journal reported, citing an employee briefing hosted by Jack Hergenrother, a company vice president.
The US company told some employees it’s adding engineers and researchers in places including Bangalore, India, the Journal said, citing employees who were briefed on Monday. Representatives for the company didn’t respond to requests for comment outside normal working hours. Most Read from Bloomberg Businessweek Losing Your Job Used to Be Shameful. Now It’s a Whole Identity FOMO Frenzy Fuels Taiwan Home Prices Despite Threat of China Invasion Fox News Embraces a Different Kind of Guest: Democrats Musk Gets the Warlord Seal of Approval for the Cybertruck Five Questions With Deval Patrick at the DNC ©2024 Bloomberg L.P. View comments
IBM to Shut China R&D In Move Affecting 1,000 Staff, Yicai Says
August 26, 2024 08:47 AM BST | By EODHD
