11 September 07: the EUCCC press conference

So, the “new” EUCCC (European Chamber) launched its Position Paper. New because we have a new president (Joerg Wuttke) and a new secretary general (Michael O’Sullivan).

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New also because I was pleasantly surprised not to have to listen to the usual bland pep talk on how we are all so happy in China where we are really so profitable and only have some tiny tiny suggestions for our Chinese “friends”.
Finally some plain and hard facts were put on the table. In a diplomatic way, yes, but some facts are not that “pleasant” to hear.
I am always put off by the sugar and honey talk of western officials when they address local audiences or by the naïve attitude from “seasoned businesspeople”.
Well, this is still much a free for all and merciless environment where foreign businesspeople often bite the dust.
Nationalism and “protection of the precious national assets” is now again much in vogue. Forget transparency, open markets etc.
Fact is, in 2006 the EU exported some 63 billion euro to China. China exported to the EU some 192 billion euro. The excuse that the EU “does not have the right products or prices or something like that” is ridiculous.
IPR protection? Still much of a joke despite some real progress. To get rich is good, to get rich by copying even better.
Poor China can’t handle al that IPR enforcement?
You must be kidding.
As the IHT wrote once something like this:
“Just let some FaXXXGong guy open a protest sign anywhere and ten guys jump on him. So, not to be able to stop pirated goods is laughable, if they would let the millions of security people open their eyes it would be cleaned up in one day.”

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Curious to see later how the 130 journalists in the room will understand and interpret all that.
And, by the way, the opinion expressed here is mine and also of many people I know. I am not talking here as the chairman of one of the EUCCC working groups.

Behave! Lu-Chin Mischke speaks out

On Saturday 2 June I went to Lu-Chin’s presentation of her book “A guide to Bringing out the Best in Yourself”, organized in the Hilton Hotel – space graciously provided by our good friend Vlad Reyes (a Rotarian, by the way). She made also a presentation in our Beijing Rotary Club where she is a regular guest.

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her book – Gilbert with the author

You can call Lu-Chin Mischke our Ms. Manners, local version. She set up the Pride Institute and has been bugging me (nicely) since some time with her relentless campaign, trying to educate our Chinese friends, like no spitting, no littering etc. Tough job and she has endless enthusiasm that I admire. Against all odds (OK, that me speaking, so don’t pay attention) she has been scoring some nice success and raised a lot of interest in the media and with Chinese officials. I think she must have some stubborn Flemish blood in her veins… She really never gives up and still sports a big smile (you are Ms. Manners or not).

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Ms. Manners in action

I bought several copies of her book, all in Chinese (obviously), to give out to some people. The one she signed for me I’ll keep of course. Pity I can’t read it, maybe I really need better manners too?
If you want to know more, see her website: www.prideinstitute.cn
And: behave! Watch your manners!

China’s growing power: a threat? Growing for sure

See here part of an article (Associated Press – SCMP) dated 3 May:
quote
Congress blasts Beijing across a broad front
House hears critics’ testimony on mainland’s military budget, abortion policy and diplomacy.
US Congress members have attacked the mainland on a range of issues, criticising Beijing’s test of an anti-satellite weapon, military build-up, policy on forced abortion, support of ruthless regimes, and repatriation of North Korean refugees in violation of international law.
At a House foreign affairs committee hearing, lawmakers repeatedly expressed concern over Beijing’s suitability to host the 2008 Olympics.
“If ever there was a time for China to get its house in order, this is it,” said committee chairman Tom Lantos, a Democrat.
Dana Rohrabacher, a Republican and critic of Beijing, noted that the US had played a significant role giving the mainland the wherewithal to become a military power because of its robust US-bound exports.
“We have built up a Frankenstein that now threatens us,” Mr. Rohrabacher said.
Unquote
So, our U.S. friends are getting nervous and want to urge all to get China in line with their own ideology.
It’s not that what they criticize about China is wrong as such. Problem is, the USA has lost most credibility in preaching. Their track record has become too bad and the only hope is their incompetent government will change for the better in the near future.
As for the role played by the “U.S. capitalists” to make China rich, they are absolutely right. Thanks to the big MNC who use China as their cheap production base, to flood the USA with cheap goods through Wal-Mart and others, kill local manufacturers and make a big profit for themselves. At least consumers are happy over there to buy all the cheap stuff and have their credits needs satisfied thanks to China’s support of the USA financial system.
In the meantime, China’s development continues unabated. Many economists now count the days China will be the world’s top exporter, overtaking in the next two years soon the USA and Germany. Exports would then be around US$ 1.4 trillion and total trade US$ 2.5 trillion.
Part of that export will be luxury brands. Within two years 60% of the world’s top brands will be Made in China.
As for the average per-capita oil consumption in China: scary figures. In 2005 it stood at 242 Kg against 2,722 in the USA and 1,724 in Japan. Just imagine Chinese double their consumption (then still only 20% of the USA figure). Comments are superfluous.
While China has a lot of house cleaning to do, more is going on then people abroad realize. The anti-corruption drive continues and I expect some further top-level “cleaning” this very year. Keep your eyes open. Investigations continue discreetly. Needed, really. Official sources say close to US$ 400 million of social security funds cannot be “properly accounted for”. Probably just one small example of the “irregularities”.

The distorted vision on the Beijing 2008 Olympics

Just got a copy of a 10 page report on the preparation of Beijing’s 2008 Olympics, written by the firm Cushman & Wakefield (“Global Real Estate Solutions”):
“After The Games are Over – Feast or Famine? Will Beijing suffer the fate of past host cities or will the games add to the momentum of this growing city?”
Author is said to be Rachael Jones, based in the Shanghai Office. Well, maybe that’s why.
The report seems to be based on solid research, including the experiences of past Olympic cities and comes up with – at face value – convincing figures and statements.
Unfortunately, many of them are plain wrong. It repeats the typical distorted view on the cost of the Olympics (see earlier entry in this blog!), completely misunderstands the so-called “frugal” approach for the stadiums (creating the potential disaster for post-Olympic operation), misses the real risk factors in the post-Olympics, etc. At a first glance, the analysis of the hotel sector also seems dubious.
I did a very detailed study on the former Olympic cities on behalf of the Beijing Government (see our website and the brief about me) as well as a review of the main economic issues for the post-Olympic economy. I also visited some of the locations and discussed with the local governments.
The other curious conclusion (for somebody who is supposed to understand Beijing!) is the impact of the Olympics on the residential real estate. Luckily this is in part corrected by pointing out somehow the underlying need for new housing that has nothing to do with the Olympics.
Our firm had just a series of meetings with real estate investors from different countries and the point of view on the local market were, well, very different.
Well, all good for my ego. Just confirms to me how few people understand what has been going on here, what are the challenges for the Beijing economy – and the real estate sector. So, I better charge more – right people?
Or maybe simply write that book. Well, maybe not. Some people here might not be so happy…