It seems everywhere I turn I see an article (usually American) about the China threat posed by the country’s outward bound investment. However, China faces three challenges to world conquest: a lack of management talent; a lack of financing; and a lack of information about international markets. Analysts have been saying for the last five years as Chinese companies have increasingly been looking abroad to invest that the greatest drag to their overseas development is the lack of management talent that can integrate the investments in foreign climes. “China’s reform and opening up has occurred only in the last 30 years,” Touchroad Chairman He Liehui told the Wall Street Journal recently. Touchroad and affiliate Daheng Holding Group are a Chinese private equity group with holdings in textile manufacturing, foodstuff and textile trading, and resources development.“The history of companies – private companies – going abroad to invest likely doesn’t exceed a decade.” With that short a history, nursing talent “with cross-border, international operational abilities is pretty difficult,” he said.

Another challenge He sites is a common one even with domestic private companies in China: lack of access to capital. Despite Wen Jiaobao pledging US$1 billion to SMEs in Africa over the next three years, companies have little information about when and how to access the loans. And then it seems most of the information and analyses about markets goes to theState-owned Enterprises (SOEs).

Look for the growth rate of Chinese ODI to plateau in coming years as investors come to grips with the gravity well of its history, culture and its development structure.

More reading: FT