China Boom CMS

<p>So I would say, shoe business, I would never leave that business because of the arts. I still want to go on, even now I'm doing logistic business by air, by sea. Ok, but I still will go back to that shoeline, but now because of the economic crisis in Nigeria, and a lot of Chinese flood into the market, the high demand of people goes down and because of our country policy that some of the items, like shoes, is contraband in Nigeria. <br /> <br /> It makes me to slow down like in Cotonou, Togo, Guinea, Ghana, Nigerians are using their seaports. Nigerians developed Togo because of banned goods in Nigeria. Nigerians developed Cotonou because of banned goods in Nigeria. I believe that I still have good future in China. That is why I am working hard for my community to have good relationship with Chinese and Asia even in business, even in government. Because we still have good future with Chinese even more 20 years coming.</p>

<p>In school I did arts. Then in Nigeria, when motor spare parts is not profitable, then I went to the shoe line. I started in the shoe line in 1993. Then because of the art I did, then I can be able to design shoes. So I designed shoes, we started dealing with Taiwan. Then when Taiwan coming to Nigeria, we started doing business, I'm designing shoes, sending to Taiwan. They would make the sample they would send back to Nigeria. Then I confirm. <br /> <br /> After production, then we ship to Nigeria. So I started going to Taiwan and when Taiwan businessmen comes into Nigeria and open an office. So when they come to Nigeria and open an office, most of their workers they are not Taiwan, they are Chinese. So when they make order... when you make order from the company, they will make order from mainland China. So when its coming into Nigeria, the Chinese working with them in Nigeria because they feel the Chinese working are more cheap labor than the Taiwanese.<br /> <br /> So when they bring them to Nigeria to work in their company, the Chinese knows that the people are coming from their country and they are working with Taiwanese, they are planning to open their own office. So from there, the Chinese coming to the markets, when Chinese coming to the market, they continuously bringing in their people. Opening so many companies. But I look at it -- rather than dealing with Chinese in Nigeria, then I come to China. Because you deal with them in Nigeria. All your ideas, they have it. When they use your ideas, they also use for another person. Then the markets will flop. So I started coming to China.<br /> <br /> The first time I came to China, I went to one shoe factory. They're so surprised, they are happy to see somebody like me, because I can create designs. And when I look at their designers, what their designers do is copy, they copy with computer. But I can see and I can make up my designs, when I look at this shoe I can use it, make more designs. So they are so surprised to see something like this, they have not seen before. So, I started my business like this way.</p>

<p>So from my parents' age, you know, right around early 60s, I think they missed the boom completely. You know, they&rsquo;re not a participant, they're only sort of witness to it? You know? Maybe because the boom only happened in the past um 15, 20 years, maybe even 50 yrs.<br /> <br /> So to a large extent, they have kind of missed it. The younger people, you know, I think the people who are in the 30s, to 45, or 50s, they're the active, they're the biggest contributors and participants of the boom. People like me, you know in their mid 30s, you know, we're in the thick of it, and we're just lucky, you know.<br /> <br /> We're riding this wave as it becomes bigger and bigger, and you're taking advantage of you know, the market, you're taking advantage of your prior experience, whether it's from the US or domestically, you're at an age that you know...this is...the sky is the limit.<br /> <br /> Um, for the people who are in the 20s, or even younger, I think um, you know, they're seeing a whole different view about China, and they're probably a lot more capitalistic than US or Europe than you can imagine.&nbsp;<br /> <br /> So they're coming in with a very different view, they don't have the baggage of the prior...you know, the turmoil, the conflicts, you know, the downturn. So to an extent, they may be too confident, they may be too cocky, and they may be a little bit ill prepared, because many of them are being the only child, the single child. You know, have led a very sheltered life.</p>

<p>Well Taiwan's opening up to China in the late 80s coincided with a period of also Chinese opening up and a policy of engaging with the rest of the world economically. So the Taiwanese business people who went into China early on were certainly in a position and a competative advantage or a comparative advantage, in a sense that they spoke the language, a common language, and they had a slightly better understanding of the Chinese culture than perhaps other western competitors or businesses wanting to go into China. So in a short just few short of opening up, Taiwanese eventually grew to become one of the largest foreign investors in China.<br /> <br /> The economic relationship has certainly enhanced the mutual understanding but at the same time the irony is that the Taiwanese identity has also strengthened during that period. So, economic interaction across the Strait, you know there are more people in Taiwan who are advocating that it is possible to maintain a political position, that it is possible not to compromise politically for the sake of economic engagement with China. And this is something that a policy decision that many countries around the world have to make. When they want to do investments in China and they want to do business with the Chinese. Do they have to concede on certain political positions? Do they have to silence themselves on human rights questions? I don't think that's necessarily the case. And the Taiwanese need to become much more skillful at positioning ourselves as well.</p>

<p>On June 4th, (1989), I found out about it on CNN, I watched CNN 24 hours a day. Actually before June 4th, there was a long prelude of events. I knew students were on hunger strikes. At that time, I started to have some contact with my family in Beijing. I asked them what the conditions were and they very excitedly told me that students occupied the Square, and that there were hunger strikes and so on.<br /> <br /> <em>

[Interviewer: So a few year before that you probably didn't have the interest, wouldn't have called your family...]

</em> <br /> <br /> That&rsquo;s right, I had no interest. The reason I came back (in the 90s) was to see my father. He was dying, and I was staying at home, like a child. But I stayed at home also because really I had nothing to do. In '93, China was still pretty repressive. Basically, after '89, after the crackdown on students<br /> <br /> China was under severe ideological control. So the whole society developed very slowly. There wasn't much to do, so at the time, I made the Black Book and the White Book, and the Grey Book. <br /> <br /> <em>[Interviewer: And right then, the post '89, avant-garde art movement was happening in East Village Beijing. How did you see them then? You just came back from New York, and see these (activities) in Beijing. Because artists like Zhang Huan are very different compared to those in the 80s who were very serious about protests.]

</em><br /> <br /> First, you could see that they were very young, secondly, you could see that they were no longer interested in painting and drawing. They would ask, so, how does America, or New York, look at Chinese artists? How would Chinese artists survive and develop in the West?&nbsp;Actually, I couldn't even survive and develop there. That's why I came back. But I understood them. So basically I discussed with them mostly about how they could express the situation of their existence in China. <br /> <br /> <em>[Interviewer: Yes, you told me that once you told Zhang Huang not to mimic the West, but should instead try to express the immediate environment that was surrounding him.]
</em><br /> <br /> Yes yes. I told him that he can&rsquo;t do that. The environment in East Village Beijing was really abject, very bad. I remember we went to a public bathroom, it was very dirty, and I told him,&nbsp;&quot;You can't be thinking about America's situation from here. You can't sleep on your pillow and dream a rich guy's dream. It's impossible. You should wholeheartedly respect the your current living situation. And your current living situation is something that Western artists do not have. It's one of your advantages.&rdquo;</p>

<p>I feel that the main characteristics about the past 30 years are first, China wants to survive. How can China withstand? This is the main narrative. And this struggle for survival includes both the political party and the nation's chance of persistence.<br /> <br /> Basically, this is the initial motive. And then after, because of Reform and Opening, a large number of interest groups formed, how to transfer wealth in a state-owned, public-owned country into the hands of some individuals. This process is like the vigor of a cancer, it grows very fast on its own, so I feel, basically, this is the situation.

China's future is very bleak, but I don&rsquo;t know about the world. Because China... it's a society completely without ideals. In the past 30 years, no legitimate status or legitimate social structure has been established. It&rsquo;s not a society run by rule of law, and there is no real, so called, equality or social justice. The most basic kind of moral constraints are not there.&nbsp; <br /> <br /> So it's still a very dangerous society. Those who have benefited are from inside the CCP. I think their behavior is predatory, rapidly transferring public resources into the hands of some individuals or interest groups. And what is sacrificed is the environment, the interests of the farmers and the common people, education... Also, national resources, energy, loss in massive scale. And as such, social conflicts will, already has, become bigger and bigger.</p>

<p>What the communists brought to China was the so called planned economy system, everything was top down, they designed everything. You know, it was this organization, this organization, everything sort of followed a certain way. That, of course, turned out to be not very effective as we know, as I mentioned about the Cultural Revolution and so on. But the remnants of this planned economy, even with economic reform was very effective in directing the development of the whole country. <br /> <br /> It was very effective in directing the resources to where the country actually needed. So the combination of the official China which is a top down mechanism to try to direct the development of the country, plus the allowance on a grassroots level of entrepreneurism, what I call entrepreneurial China in my book. This combination turned out to be very unique and it is very, very effective, very powerful, in driving the development of China during the last, as you mentioned, couple of &nbsp;decades and GDP growth of, let's say, 10% every year, in my opinion, is a direct result of this very unique model. <br /> <br /> But, the funny thing is, the Chinese actually did not design it, the Chinese just happened to fall into it, because of history. But it turned out to be very effective and I believe this model will continue to drive the very fast growth of the Chinese economy over the next decade or even more.<br /> <br /> The 175 years, or so, of troubled history actually have also, has a deep impact in the hearts of the Chinese. In fact, this has actually driven a deep sense of nationalism within all of the Chinese and the Chinese do recognize that this last 30 years of relatively good performance of the country is something that&hellip; it didn't come easy. It's not like this is God given thing to the Chinese, the Chinese had to fight, had to work on it pretty hard actually. And if you look at recent history, this is really the only time where China has had a reasonably stable environment and, of course, a pretty good economic performance. <br /> <br /> So, for many of the Chinese, they do recognize that this is a period that everyone needs to treasure. It's not like, &quot;Hey, we screw up then next time it's gong to be very easy.&quot; I think a lot of people do recognize that if we screw up this time, it will take a long time for the Chinese to come back, because we've seen it in our recent history, many many times of foresight. <br /> <br /> And, so, for the Chinese, in particular, the Chinese government, they're actually quite cautious about the path forward. Cautious from the standpoint of, number one, stability is important because you know, we have had so much chaos in the last 170 years or so and having another period of chaos certainly isn't to the interest of the Chinese people. Number two is, the model that I mentioned, the unique combination of a top-down official China and then the allowance of a grassroots level entrepreneurial China. <br /> <br /> That model, this so called &quot;China model&quot; has worked in the last 30 years. In my opinion, it probably will work for the next decade or maybe even two decades, but, as all things, nothing is going to be stagnant, things are going to be changing.</p>

<p>Broadly speaking there are two types of Chinese companies. there is one type which is owned by the state, so state-owned enterprises, and then there's another type that is privately owned, so owned by, normally, private entrepreneurs. The way that they operate is quite different. <br /> <br /> The state owned enterprises, the most successful state owned are typically large enterprises. They operate in industries that are somewhat protected, if not entirely, protected by the Chinese government, so they can be large and quite powerful in their own right. I'm talking about companies in, for example, telecommunications and energy, and utilities and so on and so forth, and banks and so on. And these are some of the largest enterprises in China, but they're SOEs, they're state-owned enterprises, so they have to follow a certain way that the Chinese state dictates to them. <br /> <br /> The other type, the privately owned companies are, in my opinion, much more interesting, because they are&hellip; Many of them actually start with nothing, they start as very small companies, but the very successful, privately owned&nbsp;companies, they have been growing very fast. And, typically, they are led by one entrepreneur, or a small group of entrepreneurs, and these people are, typically, they are very flexible, they are very ambitious, they are quite visionary, typically, and they usually make decisions very fast, because they see the market, both in China, as well as, the relevant market outside of China moving very fast, so, they themselves, are very fast in making decisions. <br /> <br /> They are a believer in a lot of experimentation. They don't necessarily want to get everything sort of precise and right. They'd much rather try something, if it's 80% right, try something and see how the market responds and then adapt. So, they work at a rhythm that is much faster than the usual competitor in western multinationals. Whereas typical multinationals would typically operate in this manner, the Chinese would typically operate in a much faster rhythm. So, by the time the multinationals are ready to make decisions, the Chinese have already made cycles of decisions and have learned a great deal through their experimentation. So it's very dynamic, but we've seen more and more Chinese companies who are able to leverage this kind of model to grow very fast and more and more of them have become bonafide competitors to the multinationals. And the multinationals actually have found it, in many cases, very surprising to see this kind of new competitor which operates in a very different way than the traditional multinational competitor.</p>

<p>Multinationals, when they came to China, they, of course, brought employment opportunities for many of the local people. They made investments, so they brought capital and you know, of course, they pay taxes to the local governments and so on. But also, for many of the multinationals, when they came, they also brought along their technology, their business models, their capabilities. In many ways I think the Chinese were actually quite struck by how multinational corporations actually work. <br /> <br /> As I remember, I returned to mainland China in the early 90s, and at that time when I was in China, in fact the Chinese had no concept of what a company was, they had enterprises, they didn't have companies really. And a state-owned company, a state-owned enterprise, at that time was really just an arm of the state, and they fulfilled the designed role by the state to each of the enterprises. Which was, of course, a very different notion than what a company is all about. But, over time the Chinese enterprises, and of course many of them turned into companies, when they interact with multinationals they actually find out, &quot;Hey, there's actually another way of running a business.&quot; And so, the Chinese were trying to learn from the foreign companies in many different ways, not only about technology, not only about products and services and so on, but, importantly, the Chinese were trying to learn about management practices, about corporate governance and the legal aspects and so on and so forth. <br /> <br /> And, in fact, for many of the work that we have been doing for these Chinese companies, it is requested by the Chinese companies, because they are so interested in how foreign companies actually run the businesses, so, in many cases, we are asked by our Chinese companies to &quot;benchmark&quot; the best practices, the world's best practices. Right? What do the world's best companies in my industry actually do? How do they run the business? How do they organize themselves? What are the key processes, management processes, business processes that these so-called best practice companies actually do? And Chinese companies are very curious about all that, they are eager to learn, because the very best Chinese companies are actually very ambitious. Many of them, of course, want to be the leaders in their industries within China and also, an increasing number of them would like to become international companies of their own right. And so in the Chinese way of saying, &quot;they want to go outside&quot;. So, more and more Chinese companies are coming to us asking us to help them to help them design their globalization strategy. How should they internationalize? Which markets should they go to? How should they set up their product strategy? Should they form local partnerships when they go outside? And so on and so forth. So, the Chinese are learning a lot, and they continue to be very ambitious.</p>