Chinese Taboos

There are somethings which are better left out of any polite conversation with your Chinese colleagues. Politics isn’t necessarily one of them, unless you mention one of the two T words – Tibet and Taiwan. Both these issues hit at the very heart of Chinese identity. Modern China is in fact smaller in size than in the time of the last imperial dynasty – the Qing, mainly due to the independence of Mongolia – or more accurately outer Mongolia (directions being given from the Chinese side of the Great Wall), and land that was also lost to the Soviet Union at the same time. There remain disputes over relatively small areas of land, most notably the Spratley Islands, claimed by a handful of countries, and Arunachal Pradesh, currently under Indian rule. The relative size of these disputed regions bares no resemblance to the feelings which they arouse – perhaps not unlike the British view of the Falkland Islands.

Oddly the “question” (as the Chinese call it) of both Taiwan and Tibet is largely answered. Formal policy from Taipei (capital of Taiwan) is that Taiwan is a part of China – and consequently Taiwan, (the Republic of China) also lays claim to the Spratley Islands and Arunachal Pradesh. There is no disagreement from Beijing or Taipei on what is known as the One China Principle. The principle states that there is only one China, and both the mainland and Taiwan are part of it. Disagreement comes only as to who is the legitimate government of China.

Likewise, official policy of the Dalai Lama is that Tibet is a part of China, and in what he refers to as the “Third Way” the Dalai Lama has sought to break the impasse of the two alternatives – an Independent Tibet and Tibet as an undistinguishable part of Chinese territory – by advocating a Tibet within China but with some genuine autonomy. In this regard the One Country Two Systems approach taken with Hong Kong may suggest what the Dalai Lama has in mind.

Despite the official positions of those who lay challenge to Beijings absolute sovereignty over Taiwan and Tibet not being the cries for independence many assume, there are, nonetheless, vocal groups who are asking for just that. Such a call is implicit in the name of the Free Tibet movement, whilst politicians on the island of Taiwan have demanded independence as part of election campaigns – although the calls are less evident if elected to office.

Unless you agree that Taiwan is an inalienable part of China and that the Beijing government is the legitimate government of all China, then this subject should be considered taboo. Similarly, unless you agree that Tibet is an inalienable part of China and that the Beijing government is the legitimate government of all China, including Tibet, then avoid discussing this issue. Your ‘unorthodox’ views will be less than welcome, and more likely than not will receive an unusually strong rebuttal, scorn and ridicule. I’m not suggesting that there is absolutely nobody in China who disagrees with Chinas stance on these issues, but by and large a nationalistic view is held by the huge majority, and in general the very best you can hope for is to embarrass the person you are talking to. Offending or insulting them has a high level of probability.

But why such sensitivity? One could equally ask why the British hold the Falklands as dearly as they do (though I suspect there is a wider difference of opinion when it comes to the British public’s views on the islands). For sure, there is an element of national pride. But for China there is also the historical context where for just over a hundred years China was at the mercy of foreign powers all taking bits of territory – including Britain’s attempt to take Tibet into its sphere of influence. The period is known to the Chinese (and every Chinese school child) as the Century of Humiliation. Undoubtedly this adds an extra dimension to these issues, with the Chinese blaming themselves for the tragedy – China was weak, and therefore to blame for being exploited by the colonial powers. Today’s response to any suggestion, let alone attempt, to divide China may be an overcompensation for past failings, but the feeling of determination to maintain the integrity of China really can’t be overstated.

Your political views may mean you have a different point of view, but unless you hold them so strongly that you are prepared to have your business relationships destroyed, it really is better to give the subject a wide berth.

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Dumping

Once again Chinese companies stand accused of dumping goods in Europe. This time it’s solar panels. What makes this incident different from the others is the value of the exports, some £16 billion plus. It will be almost another year until the EU gives its verdict, whilst the US has already slapped import duties following a similar complaint in the States. Worryingly the Chinese are strongly hinting that they aren’t going to take this lying down, and some retaliatory measure would follow any EU sanctions. But how much of this is a bluff on the part of the Chinese? China seeks to adjust its economic growth model, looking to switch its reliance on exports to domestic consumption. The task is monumental enough as it is without the further complication of a trade war with the European Union and the US.

The truth remains that Chinas success is linked to our own. European manufacturers should be protected from unfair competition from China or elsewhere. Hand in hand with that is the need to promote a win-win situation for everyone. Restricting trade with China leaves everyone a loser.

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Working in our own interest

The story that China is likely to be involved in developing Britain’s nuclear power capacity has been around for some time. It is an interesting thought, given that Home Secretary, Theressa May, recently expressed national security concerns over Chinese nationals. According to the Guardian,

In May, the energy minister Charles Hendry told the Energy and Climate Change select committee that he had no objection to Chinese firms being involved in the UK.

So what is going on? One thing that definitely isn’t going on is joined up government. For all the criticism that the Chinese government gets, there’s no doubting that there is some consistency in its approach, and a sense, at least, that it is working to some strategic plan. Deng Xiaoping’s metaphor of crossing a river by feeling the stones suggests that there was no clear strategy to China’s reform programme. Yet some thirty-plus years on we’re talking about China’s possible involvement in building nuclear power stations in the UK.

Undoubtedly the world is complex. There will be a difference of opinion in government. But some issues are of national strategic importance. I would suggest that the relationship with China is one such issue. As we explain in may of our training courses, trust lies at the heart of relationships in China, whether between individuals, companies or indeed governments. Understanding how relationships work in Chinese culture is not difficut, but something which few people take the time to acquire properly. But for those who really want to get the most out of working, trading, living or dealing with the Chinese, acquiring that understanding should be high up on their agenda, and that includes within government.

The criticism may be levied that this is just pandering to the Chinese. I’m not going to split hairs, in many ways, yes it is. But there’s a bigger picture to see. It is about working in our own interest, be that national, corporate or personal. And what’s the alternative? Demanding that the Chinese adopt our cultural norms or we don’t engage? Not only is that incredibly short sighted, but ultimately is a misreading of the way the world is today. And if that thought is foolhardy for today, then it is sheer madness for tomorrow.

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Vain?

Much of today’s press on China refers to the slowdown in the Chinese economy. Nine percent, it would seem, is something to be worried about. Yet it was earlier this year that the Chinese government announced a reduction in its growth target. This reduction was often linked to slow growth and crisis in the rest of the world. This may well have had something to do with the decision, but probably wasn’t the major concern. China’s overwhelming issues are domestic, and whereas there are issues of over dependence on exports, and a need to promote domestic consumption, the much larger challenge for China lies in the ever-increasing disparity between rich and poor. In our post Time to smell? we reported on Burberry’s claim that one of its top selling items in China was a £2495 iPad cover. Such wealth is not in itself the issue, but when you consider that it could well be be cheaper to employ someone to carry the iPad around for its two year life expectancy, then the vast income disparities in China become more sharply focused. Such inequality poses a threat to social harmony, and if one thing absolutely pre-occupies politics in China it is maintaining social harmony.

The target of 7.5% for 2012 reflects expectations that reduced exports due to the European crisis and a fragile US recovery could dampen growth in the world’s second-largest economy.

It is easy to point to the Euro crisis or a stagnant US economy, or some other event happening in the West and to pin changes in China’s economic policy to them, but we shouldn’t be too quick to think that every song is about us!

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Time to smell?

The Financial Times reports that Paul Smith announces he is returning to the Chinese market after pulling out some five years ago.

Sir Paul must surely at least have slightly raised an eyebrow at reports from rival British firm Burberry, which reported China as second only to the US for sales, with one of its best selling lines in China being an iPad cover costing £2,495 (more on this in the next post, Vain?).

With China’s middle class racing to be added to the list of China’s catalogue of world’s largest, the lure of the Chinese market is self-evident, even for those who have been badly bitten by it in the past. There are two important things to draw from this. First, just how strong the gravitational pull of the Chinese market is. Paul Smith pulled out of China in 2007 after heavy losses, calling it “dangerous’. Despite such a history he is being drawn back east. Second, that we need to adjust our concept of time when we look at China. In what would seem a very short time in western markets, the whole landscape will have changed in China. As such, it may very well be time to smell.

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Blind Justice:? The case of Gu Kailai.

Gu Kailai, wife of the popularist politician, Bo Xilai, former Provincial Governor of Chongqing, has been given a suspended death sentence for the murder of British businessman Neil Heywood. Ms Gu had confessed to the murder, claiming that Mr Heywood had threatened her son, allegedly over a disputed £13m compensation payment Mr Heywood was claiming. Ms Gu’s accomplice, Zhang Xiaojun, was sentenced to nine years.

According to the Telegraph :

However, the court explained it had suspended the sentence in light of Gu’s mental state, her admissions of guilt and remorse, and her cooperation with the investigation.

China’s judiciary isn’t averse to handing out the death sentence, nor implementing it. There is widespread support in China for this modern version of China’s legalist tradition. Public opinion in Britain is generally against the death penalty, and certainly this is government policy. The Times reported that the British government had let known that it did not wish to see the death penalty applied in this case.

I doubt whether the wishes of the British government played much part in the sentencing of Ms Gu; if the British government couldn’t prevent the implementation of the death penalty on a British subject, then it is difficult to imagine it would have much success in influencing the outcome for a Chinese citizen.

There’s a marked cultural difference, one we can recognise and accept as something we agree to disagree upon – in the same way as we do with the US. Yet trying to influence the outcome of Ms Gu’s sentence is perhaps a step too far. Certainly it seems difficult to justify why murderers of British subjects should be exempt from the death sentence! It flies in the face of the treasured belief that justice is blind.

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Business sense versus the Yellow Peril.

The business case for encouraging more Chinese tourists to the UK appears not to be strong enough to convince Home Secretary Theressa May, to make it easier for Chinese tourists to enter the UK, worryingly raising the ghost of the ‘yellow peril’ by citing national security concerns.

A tourist visiting Britain will spend an average of£567, however, Chinese tourists spend three times that amount, averaging £1,700. Had the same number of Chinese tourists visited Britian as France last year it would have injected an extra £1,786,700,000 (yes, almost £1.8 billion) into the British economy; but it is not just the loss of a much-needed boost to the economy that should concern us.

Suggesting that the Chinese people pose a threat to national security is difficult to understand. Neither France, Germany nor any of the twenty-plus countries that require just a single Schengen visa to visit have such qualms. Even the twitchy USA employed an extra 50 visa processing staff at its Beijing Embassy earlier this year and relaxed its visa requirements in order to attract more Chinese tourists, so no sign of any “national security” concerns there either! Sadly we should be under no doubt that the Home Secretary’s words will be heard in Beijing, and they won’t be making Britain any friends.

Meanwhile Culture Secretary Jeremy Hunt, has just launched an £8m campaign to try to attract more Chinese tourists to the UK. Last year 1.2 million Chinese tourists traveled as far as France; getting them across the Channel surely can’t be that hard… except they won’t have visas!

What we are left with is a lose-lose situation, with a gratuitous face-losing swipe at the Chinese thrown in for good measure. With regret we return to a familiar sight, with an avoidable lack of understanding of China and the Chinese once again resulting in unnecessary damage to Britain’s standing with such an important economic partner.

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When is a dragon not a dragon?

The Western concept of the dragon is that of a tyrannical beast that bringing fire and destruction; it is something to be killed: Indeed, killing a dragon may well be the way to sainthood!

In the Chinese mind the dragon is an altogether different creature. It is a bringer of good luck and bountiful harvests,  a symbol of power and wisdom.  Legend has it the Chinese are decedents of  the dragon.  If a Chinese person were to spot a dragon the last thing they would think of would be to kill it!

How we see the world is framed by our cultural reference points.  Whilst confidence and security in who we are is essential, ignorance of others provides fertile soil for the seeds of  misunderstanding.

A shared mythical creature and a directly translatable word, yet our understandings are about 5,000 years apart! Getting it right in China is not easy:  It isn’t easy for most Chinese! Clearly, understanding each other is more than a matter of words.

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