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Bud joins the rush to China

Anheuser-Busch (NYSE: BUD) has become the latest in a very long line of large U.S. public companies saying that the future is in China. To make U.S. firms a big success, the Chinese will have to eat a lot of McDonald's (NYSE: MCD), drink a lot of Starbucks (NASDAQ: SBUX), and shop all day and all night at Wal-Mart (NYSE: WMT).

The boys at BUD say that their overseas sales are only 10% of total sales, but that the figure is growing faster than it is in the U.S.. However, that may be due to the law of large numbers. BUD's sales outside the U.S. are so small that they should be growing.

Since India is the other huge developing country outside the U.S., BUD does not want to neglect it when mentioning its plans. Reuters quotes management as saying: "We have a very long-term involvement in China, and India is the only other Asian country besides China where we have invested in a brewery."

Whether the Chinese want to drink beer that is made by outside brewers is not something that will be known for a while, but BUD does face competition from local companies and all of the major beer firms in Europe.

If the Chinese are willing to drink a case of beer per person, the whole thing may just work.

Douglas A. McIntyre is a partner at 24/7 Wall St.

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Last updated: May 27, 2012: 09:21 AM

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