The real cost to China's businesses with government anti-corruption crackdown

Many news reports have been published about China's ongoing crackdown on corruption (tigers and flies), but now one of the world's biggest banks has put a price on the corruption.

The report published by the Bank of America Merrill Lynch this week, the Chinese government's anti-graft campaign could have cost China's economy more than $100bn this year alone. 

Many of the small effects of the anti-corruption drive have already been well documented; a slowdown in the restaurant trade and sales in luxury goods has seen Chinese business go out of business.

The gift giving culture is part of the Chinese business culture and required if doing business in China.

The past year has seen Shanghai's posh malls and boutique designer shops business slow to snails pace but the BofAML report suggests that the campaign is also having a significant and troubling macroeconomic effect.

Early last year, government bank deposits have been soaring, by almost 30% year on year and even honest officials are now terrified of starting new projects, for fear of being seen as corrupt that they're simply keeping public funds in the bank.

The cost to the economy of the prohibition on government consumption and the chill on admin spending is an estimated reduction in growth of at least 0.6% this year but it could, the report argues, be as high as 1.5% which gives us the figure of about $135bn of lost economic activity.

The report's authors admit their calculations are a back of the envelope estimate of fiscal contraction, but even if they are only half right it is an extraordinary amount of money and it highlights some of the challenges facing China's anti-corruption crusader in chief, President Xi Jinping.

Since taking office over a year ago Xi has made the cause his goal, warning that official graft and extravagance threaten the very survival of the ruling Communist Party.

Published by Go Frontiers (UK & China)

Part A: Chinese Premier Li Keqiang visits the UK yesterday

Yesterday (17th June 2014) the UK played host to China's Premier Li Keqiang and a Chinese delegation on their three day visit to the UK.

The Chinese Premier Li Keqiang arrived in London, yesterday on a three day visit, which is part of Europeon tour for his first official visit with the aim for business talks with the British Prime Minister David Cameron.

Later on in the day Premier Li will have an audience and photo oportunity when he meets Queen Elizabeth II at Windsor Castle.

Their has been plenty of discussions about doing business in China and the UK and the diffeculties in British and Chinese business culture.

However Mr Li said he really hoped his visit would expand Sino-British busines co-operations and create a better understanding between both countries.

The talks went well for both countries but Mr Cameron still remains hugely concerned about China's human rights.

Published by Go Frontiers (UK & China)

On business in China and eating out - What you need yo know?

You're doing business in China and are negotiating a big deal for from the early hours of the morning with five Chinese directors discussing your products, brands and the possabilities of exporting to China. At lunch the directors take you out for dinner at an expensive restaurant. When the first dish of chickens feet arrives, one the directors jumps up and using his chop sticks serves you a chicken's foot on to your plate.

What are you going to do? What does this mean to you, your business and your deal?

A: Have you upset him or coursed him to loose Face
B: The director thinks you are struggle with your chopsticks and is trying to help you
C: The director is showing his respect
D: The directors having a bet to see what you will or not eat
E: Think I should have accepted Go Frontiers (UK & China) services in Mandarin and Chinese Translation Services


Then, what are you going to do?
A: Think 'Oh Boy!!!' and get tuck into food thinking of a the bush tucker trial
B: Thank him and eat the food
C: When no one is looking through the food behind the curtain
D: Leave the food and make an excuss

Chinese business culture is some thing you need to know if you are doing business with the Chinese.

Published by Go Frontiers (UK & China)

Confucianism the key element to Chinese business culture

From 500 BC to the modern age Confucianism still plays a key role in Chinese business culture and China's character and behaviour to create harmony in society.

President Xi Jinping, the new Chinese President, and his government are now promoting the importance of Confucianism and its positive impact on Chinese society focusing not only on social but business values too in order to promote harmony in society and the working environment.

Confucianism is engrained in China's culture plays its role in social/work ethics, family and relationships. The theory of Confucianism is discussed regularly during dinner, especially between business people.

Learning some Confucianism will give you something to talk about at the dinner table and will help you to build relationships with your Chinese counterparts and agents when doing business in China.

Published by: Gary Rice, Go Frontiers (UK & China)

Exporting to China - the new SME buzz words in the Midlands

Exporting to China are the new buzz words being used by the SME's in the Midlands area. Two of the top destinations are India and China which highlights the issue of culture and doing business their way. Providing you want to be successful that is.

The common issue over looked until it is too late is culture. Culture in many countries is a big deal especially if you are doing business in China were you will need to grasp an understanding of the Chinese business culture and Chinese social culture.

Business in China is done very differently as the Chinese prefer to build trust before they do business. So it is important to spend the time and build a good relationship that will last.

To do this you need to know how to show your respect and portray your class. Developing your Face and others is equally important when building Chinese relationships.

Published by: Gary Rice, Go Frontiers (UK & China)

China: Dinner table etiquette whilst dinning out on business

Dinner table etiquette in China plays a special part in their social culture and family as a way to show and demonstrate your status and respect, Face and strength of your relationships.

These areas also play a key part in Chinese business culture which can mean the difference between you wining or losing a business deal.

In China dinning out has to be done correctly and with style. As a westerner you are expected to have good manors especially if you are competing for business.

Disappoint them and you will devalue your brand. Look at it as a game with a set of rules to abide by and you will win business.

Published by: Gary Rice, Go Frontiers (UK & China)
 

Chinese business models work well in Chinese business culture compared to Western business models

Six months ago I spoke with the owner of a medium sized Chinese company about modernising her company from the traditional Chinese business model to using a business model from the west.

Interestingly, the lady owner explained that this is exactly what they had done a few years ago and then laughed. She explained that she wanted to increase performance and profits and that the best way forward would be a western business model.

However, applying this with the Chinese business culture was very different. She got the whole company involved in the process but the culture wouldn't mix with the new business model.

In the end the owner and her work force were unhappy, stressed out and decided to go back to their original Chinese business model. The owner said that she was making money, the work force was happy and that she shouldn't have got greedy in the first place.

Even though this was a medium sized company we hear this problem a lot from the larger British companies who have opened a business in China or are dealing with a Chinese company.

Many blame the language barrier and have to use  to try and drive their message and orders forward but when looking closer it is in fact a cultural issue.

Culture is how people are brought up, educated and how they do things. In that country it works so why change it or struggle to try and change it. When you are doing business in a different country, be it France or China you have to do the business culture their way for it to work effectively.

Published by: Gary Rice, Go Frontiers (UK & China)

Chinese Checkers: A local business man has helped prevent war with China!

During a trade trip there Gary Rice spotted a sign at a Buddhist theme park telling staff to 'execute tourists in the most advantageous manner'.

 

Gary and his interpreter pointed out the translation error and the sign will now be reworded.

 

His Loscoe firm Go Frontiers provides Chinese Business Culture, Etiquette and Protocol training and translations to UK companies doing business with China.

 

Extract from TopNews, Feb 2014. 

Go Frontiers: Using local heritage centre's good practice helps training provider bridge frontiers in Hainan Island, South China

A Loscoe businessman successfully used a local heritage centre as an example when showing owners and managers how to develop a theme park in China.

Gary Rice runs Go Frontiers which provides Chinese Business Culture, Etiquette and Protocol training courses and translations and, through a business partner, helps companies dealing with businesses in the fast-growing Chinese economy.

He recently returned from China after being approached by a consultancy advising on expanding the park at Hainan Island near the Vietnamese border, which has themes of tropical scenery and local heritage.

Read more here http://www.gofrontiers.co.uk/blog.php?varPgId=0004-dh-lawrence-heritage-ventre-dong-shanling-hainan-island-china

Amber Valley Business Network Event (Marehay) | Go Frontiers (Chinese business culture)

Go Frontiers had a great time networking and the food at The Village Inn, located at Upper Marehay, was brilliant.

Had some great conversations about China and the Chinese business culture and how to eat with chopsticks.

The Guest Speaker for the day was David Negus from Ellis-Fermor & Negus Solicitors on HS2 Rail Line: Exceptional Hardship Scheme Phase II. 

Amber Valley Business Network Event (10/09/13) | Go Frontiers (Chinese business culture)

A good start to the day, networking and listening to the presentations on:
• Climate Change & the Environment
• Sustainable Travel
• Healthy Business

Author: Gary Rice, Chinese business culture expert
Company: Go Frontiers (UK & China)

Amber Valley Jobs Fair (06/09/13) | Go Frontiers (Chinese business culture)

We had a brilliant day networking at the Amber Valley Jobs Fair, organised by Nigel Mills MP.

 

Met Jason, an old friend from Ripley Mill Hill school and had a good chat about doing business in China and Chinese business culture and how this effects businesses and the problems of day-to-day communications.

 

Communications is an issue for companies dealing with China and companies waste a lot of time trying to communicate effectively. If the companies kept their emails simple for the Chinese who have to communicate in their second language (English). Business would run much smoother.