US tries to win a trade war it lost decades ago - Shaun Rein

Shaun Rein

The Trump team trying to negotiate the next phase of a trade war has arrived in Beijing. But Donald Trump is trying to win a trade war it lost already decades ago, says business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order to Marketplace.

Marketplace:

Shaun Rein with China Market Research Group and author of “The War for China’s Wallet” said China is no longer stealing jobs from the United States, so he said if Trump hopes to move jobs back to America it is an “unwinnable war.” 

“That ship has sailed decades ago,” he said. 

He said Chinese officials will give enough “economic crumbs” to the Trump administration to placate it, but China will not simply unblock Facebook or Twitter and allow U.S. internet giants to operate freely because the leadership is keen on controlling information.

More at Marketplace.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on the ongoing trade war between the US and China? Do check out this list 

Why China wants to rebuild Syria - Sara Hsu

Sara Hsu

Rebuilding war-torn Syria might cost around US$250 billion and China raised its hand to participate. Financial analyst Sara Hsu figures out what it behind that offer, while the rest of the world tries to steer clear from Syria, for Triple Crisis. China sees some clear interests, she writes.

Sara Hsu:

China’s choice to fund Syrian reconstruction also appears to be economically motivated, in large part because Syria provides an important pathway along China’s Silk Road. On the ancient Silk Road, the city of Aleppo acted as a key market for buying and selling international goods, and the west coast of the country continues to provide access to the Mediterranean Sea. At present, Syria has the potential to be an important logistics hub. Not only that, but the construction of infrastructure itself will generate income for Chinese firms that have shown interest in taking part. This will aid Chinese firms, especially since the Asian nation is going through a period of slowing economic growth that has led to lower rates of infrastructure investment. 

In addition, serious security will help ensure that Chinese investments in the region will remain intact. Some of these are located in Egypt, Iran, Turkey, and Saudi Arabia. The region is essential to Chinese investment in energy and infrastructure, and is viewed as an important crossroads between Asia and Europe. The security of this region can help to stabilize Xinjiang, home to Uighur separatists that China views as a threat to security and an important node on China’s new belt and road. 

The U.S., Europe, and Gulf Arab allies are steering clear of funding reconstruction in Syria, as they believe that the wrong side won the Civil War. These nations have called for Assad’s departure as a precondition for receiving reconstruction aid, as they believe Assad is responsible for myriad atrocities carried out on his own people. The U.S. took the side of moderate Syrian rebels. For his part, Assad has stated he will reject aid from nations that supported the opposition during the war. Syria has received aid from Iran, Russia, and China, and will likely continue to do so. 

Despite the opposition of the West against Assad, China’s decision to support the current Syrian government does not appear to be motivated by anti-Western sentiment or the desire to compete for influence with the United States. There are those who rally around the Chinese flag due to opposition to the United States, for sure, but these include less powerful nations, like Syria or Iran, that are politically and/or ideologically opposed to U.S. hegemony in the region and in the world. 

In conclusion, China’s position of support for Assad’s Syria underscores its security and economic interests in the region. While any measure of support for a particular regime may be viewed as political, China is attempting to refrain from engaging in directly political activities in the country and in the Middle Eastern region. China’s aim is to make economic gains through One Belt One Road, employing its own firms in the construction of much-needed infrastructure, and attempting to ensure security in order to do so. While the West may dislike China’s support of the Assad regime, China’s involvement in the reconstruction process is likely to bolster its role in the Middle East and strengthen its global soft power going forward.

More at Triple Crisis.

Sara Hsu is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on China's One Belt, One Road program? Do check out this list.  

'Made in China' is no longer inferior, but who knows? - Shaun Rein

Shaun Rein

Chinese brands like Alibaba, WeChat and JD.com still face the perception they deliver inferior products when going global, says business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order. They mainly focus on Chinese consumers who know better, but the barrier exists for global expansion, he tells the South China Morning Post.

The South China Morning Post:

By offering shipping to countries outside China, the e-commerce sites are giving Chinese brands an opportunity to expand internationally. Foshan-based furniture maker Linshimuye and domestic electronics brand Joyoung are just two well known Chinese brands using e-commerce platforms like Tmall to expand to other countries. 

One of the barriers facing Chinese brands going global is a perception that the “Made in China” label means inferior products, according to Shaun Rein, the managing director of China Market Research Group and author of The War for China’s Wallet. 

“The reality is that in many categories Chinese brands are as good or even better than multinational companies,” he said, adding that the global strategy for most local brands is to piggyback on sales channels from Alibaba and JD.com to reach end consumers outside China.

More in the South China Morning Post.

Shaun Rein is a speaker at the China Speakers Bureau? Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more stories by Shaun Rein? Do check out this list.

WeChat: the new normal for 900 million users - Matthew Brennan

Matthew Brennan

WeChat, Tencent's mobile platform, is now reaching 900 million users in China, and in four year time it has become an indispensable tool for anybody living in the country, says WeChat expert Matthew Brennan at InTheBlack. "WeChat is not a social media. Think of it as an operating system for your life in China’,” says Brennan.

In the Black:

WeChat’s reach has expanded into all walks of life. The effect has been that while you certainly can do business and socialise in China without WeChat, using the platform gives you direct and instant access to everyone. 

“It would now be very difficult to live in China and be a normal functioning member of society without having a WeChat account,” says analyst and WeChat specialist Matthew Brennan. 

“The a-ha moment for me was about four years ago when I used WeChat Pay in a convenience store for the very first time. I realised then that it was really cool, it was really convenient, and it was going to change the whole of China – and it has. I realised it was not just messaging, it had a much, much greater ambition, and that’s the way it has played out.” 

Brennan’s Beijing-based China Channel company charts trends and developments on the platform, while also offering training sessions for businesses that want to learn what WeChat is all about. There is one thing he always tells people during a training session. 

“The first thing I say is ‘don’t think of WeChat as social media. Think of it as an operating system for your life in China’,” says Brennan. 

“In China, we went from nothing to mobile payment. There have been credit cards but they have never been used in the same manner as they have in Europe or America. That habit of reaching for plastic whenever you have to pay for something, like the Americans do, was never ingrained in the Chinese.” 

These days, the Chinese daily press comes full of tales of small isolated villages where people are quickly dispensing with their traditional means of doing business – and WeChat is the leading alternative.

More at In The Black.


Matthew Brennan is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on the digital transformation in China at the China Speakers Bureau? Do check out this list.  

China is not a push-over like Japan in the 1980s - Arthur Kroeber

Arthur Kroeber

China as a country is much stronger than Japan was when it got into a trade war with the US in the 1980s, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®. Unlike Japan, China will not give in to any demands from the US, especially when those demands are hard to guess, he tells the Hellenic Shipping News.

The Hellenic Shipping News:

Beijing has not been shy in pushing back at the US, either in talking tough or in retaliating with new tariffs of its own. In its confrontations 30 years ago, Tokyo could not be so bold. Japan was in a far weaker position because of its economic reliance on exports generally and the US market particularly. Arthur Kroeber, co-founder and research head with China-focused Gavekal Dragonomics, based in Hong Kong, said that deep underlying frictions with China would not quickly go away as long as the US was not completely clear about its objectives. 

“The US playbook for this competition is still being written,” he said. “China is in a strong position and will not soon budge on the key issues that anger its trade partners.”... Gavekal’s Kroeber also ruled out a quick solution to end the friction and expected the economic rivalry to continue “on a high simmer”. 

“China will not retreat from its industrial policy goals, and the US will not be fobbed off with the usual concessions”.

More in the Hellenic Shipping News.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on the trade war between China and the US? Do check out this list.

How did the auditors deal with the ZTE scandal? - Paul Gillis

Paul Gillis

ZTE got itself into trouble by violating a ban on using American components for products it exported to Iran and North-Korea. The punishment - no US components for ZTE for seven years - might kill the Chinese companies, who cannot work without them. What did the auditors do, wonders Beida auditing professor Paul Gillis on his weblog.

Paul Gillis:

The ban came about as a result of ZTE violating the terms of a settlement agreement entered into as part of its 2017 guilty plea for conspiracy to sell telecommunications equipment to Iran and North Korea that included American components that are forbid for export to those countries. ZTE agreed to pay a fine of $892 million and be under probation for seven years. An additional penalty of $300 million was suspended provided ZTE complied with the terms of the probation, which it is reported included the requirement for ZTE to fire four top executives and discipline 35 other employees. ZTE did fire the top executives, but instead of punishing the other employees it paid them bonuses.   

ZTE was also required to undergo independent compliance audits related to its observation of export controls. 

Because ZTE violated the terms of probation they have been banned from acquiring US components (including the Android operating system) and presumably has to pay the remaining $300 million fine. ZTE admitted the behavior, but argues that the penalty is too severe and is trying to negotiate a settlement that would allow the company to survive. 

ZTE reports under Chinese accounting standards. Auditors Ernst & Young (EY) issued an audit report on the 2016 accounts on March 23, 2017. The agreement for the initial settlement became effective on March 22, 2017 and is reported in the 2016 accounts with the penalty of RMB 6.2 billion reported in other expense.  The company stated that it was unlikely they would violate the probation agreement and have to pay the other US$300 million. 

The details of when the bonuses were paid are publicly unavailable. Chinese companies usually pay bonuses at Chinese New Year, which was at the end of January in 2017 and in February in 2018. It seems most likely the offending bonuses were paid by February of 2018, before EY issued its audit report on the 2017 accounts on March 15, 2018. 

So what does this have to do with accounting?  The issue is whether EY should have known that there was serious doubt by March 15, 2018 as to whether ZTE could continue as a going concern. Should they have tested compliance with the probation agreement? 

In its audit report EY states its responsibilities as including to: 

Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on ZTE Corporation’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to issue a qualified opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause ZTE Corporation to cease to continue as a going concern. 

EY did not draw attention in their auditor’s report to any events or conditions that may have cast significant doubt on ZTEs Corporations ability to continue as a going concern. I think there was information available to EY (the payment of bonuses in violation of the agreement) that should have led to its questioning the ability of the company to continue as a going concern. I believe that auditors rarely ask these questions, although if this were a loan agreement with covenants, I am quite certain they would have tested compliance with the covenants. 

The company got a clean opinion as of March 15, 2018, although only a couple of months later the survival of the company is in question. Should EY have blown the whistle earlier?

More at the Chinaacountingblog.

Paul Gillis is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts to manage your China risk? Do check out this list.  

Women benefited less than men from China's progress - Zhang Lijia

Zhang Lijia

China's economy went uphill dramatically over the past decades, but women profited less than men, writes author Zhang Lijia of Lotus: A Novel, on prostitution in China. It is time the government starts to enforce its own laws and regulations on gender discrimination, she tells in the South China Morning Post. 

South China Morning Post:

Gender discrimination is deeply ingrained in Chinese society, which, for centuries, was dominated by Confucianism which places women as inferior to men. Today, some of traditional attitudes and practices that had been repressed by Mao have resurfaced. 

Some companies set much higher recruiting standards for women, while others refuse to hire women of childbearing age, a practice that has worsened after the end of the one-child policy. Employers view women without children as employees who will potentially take maternity leave twice. 

 In theory, China has enough laws and regulations to protect the rights of female employees. But the lack of a specific enforcement mechanism often leaves victims in a vulnerable position. Besides, given the intense competition for jobs, employers have the luxury of being choosy. The authorities rarely pursue those who violate the rules and employers can usually get away with a few extra discriminatory requirements. 

But not always. In 2012, a young woman applied for an executive assistant position with a tutorial centre but was rejected on the grounds that the job was reserved for men only. She filed China’s first gender discrimination lawsuit and won a small settlement. 

 A year later, another graduate woman won a similar case. When I interviewed her, I was encouraged by her fighting spirit. Other successful lawsuits followed, but the compensation usually amounted to around US$300. 

These cases were part of the feminist activism that has emerged since 2012, when three women paraded the streets in bloodstained wedding gowns to protest against domestic violence. Others followed suit, queuing up in a public toilet to highlight the shortage of female toilets, and shaving their heads in protest against different university admission standards for women. 

Some activists set up a Weibo account to monitor and report violations. Some of their complaints were addressed. 

Sadly, the authorities’ crackdown on activism has hampered these efforts. The growth of gender discrimination in employment has been challenged but it may spread wider in the near future.

More in the South China Morning Post.

Zhang Lijia is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch or fill in our speakers' request form.

Zhang Lijia is moving from Beijing to London early May. Are you organizing meetings in Europe after May? Do get in touch.
More stories by Zhang Lijia, you can find here.

Tension will move to non-trade areas - Arthur Kroeber

Arthur Kroeber

The US is moving from a trade war on commodities towards tech firms like ZTE and Huawei, trying to get a foothold with for example 5G into the US, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know® in the Nikkei Asian Review. "I think there probably is a desire to try and do what can be done to retard the progress of the Chinese firms in that."

The Nikkei Asian Review:

"A lot of what we're going to see over the next couple of months will target much more directly [on] nontrade areas that have to do with technology transfer and investment," said Arthur Kroeber, founding partner and head of research at Gavekal Research, on an April 17 conference call. He also pointed to the upcoming competition for the next-generation mobile-telecom system. 

"I think the timing of this is significant, because it is also at a time where the U.S. is increasingly concerned that ZTE and the other Chinese telecom company, Huawei, are stealing a march in the development of 5G technology, the next generation of technology for mobile phones," he added. "And so I think there probably is a desire to try and do what can be done to retard the progress of the Chinese firms in that."

More in the Nikkei Asian Review.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on the trade war between China and the US? Do check out this list.

Social commerce: leading for sales in China - Shaun Rein

Shaun Rein

Chinese consumers love to follow their friends' recommendations for buying, and with a mobile at hand, social commerce has become a leading force, says business analyst Shaun Rein and author of The War for China's Wallet: Profiting from the New World Order, at the South China Morning Post. Fun in shopping has become for blue-collar workers as important as the price, he says.

The South China Morning Post:

“The potential of social commerce is huge because people like to buy what their friends recommend. Increasingly, in China’s e-commerce landscape, people don’t know what sales channel to trust, but if they see their friends purchasing things on social commerce sites they are more likely to buy,” said Shaun Rein, the managing director of China Market Research Group and author of The War for China’s Wallet: Profiting from the New World Order... 

“Social commerce becomes a form of low-cost mobile entertainment, especially for blue-collar workers. Almost everybody has a smartphone now and shopping is not only cheap but fun,” said Rein.

More at the South China Morning Post.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.
Are you looking for more experts on China's consumers? Do check out this list.

Jack Ma, do not leave women behind - Zhang Lijia

Zhang Lijia

Gender discrimination is commonplace in China, out of line with international agreements and practices. Author Zhang Lijia asks Alibaba's chairman Jack Ma, and other tech companies like Tencent, and the government, to end rampant discrimination against women on the work floor, for the New York Times.

Zhang Lijia is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more speakers on cultural change at the China Speakers Bureau? Do check out this list. 

Lotus: A Novel

The race for technical leadership – Arthur Kroeber

Arthur Kroeber

The trade war, triggered off by US president Donald Trump, is about much more than trading commodities. The real struggle is about technical leadership between China and the US, says leading economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know® to the Los Angeles Times.

The Los Angeles Times:

"Consensus is growing in Washington that the U.S. is in a race with China for technical leadership," Arthur Kroeber, managing director of Beijing research firm Gavekal Dragonomics, said he recently told clients. And some think "economic cold war is the answer."

More in the Los Angeles Times.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on the US-China trade war at the China Speakers Bureau? Do check out this list.

State firms move in where private investments fail abroad - Shaun Rein

Shaun Rein

State moloch CITIC moved in to pick up 49% of Czech assets from CEFC Europe, owned by tycoon Ye Jianming. It is part of a trend, says business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order to the South China Morning Post, as state firms are easier to control by China's central government and expand its policies abroad.

The South China Morning Post:

Since Ye’s problem in mid-February, the Rosneft deal has been stuck in limbo. 

“State firms are the most ideal ones to take over the overseas projects because they are less sensitive to profits and more reliable politically,” said Shaun Rein, managing director of China Market Research, a strategic market intelligence firm. 

“They will also take over assets in countries that China is trying to wield more political power. As for the Czech Republic, it along with Hungary, are critical to China’s ambitions in Europe. It is easier to buy influence there,” he said. 

Up to 496 million shares of Shenzhen-listed CEFC Anhui International were frozen by four Chinese courts in late March. Shanghai-based CEFC, established by Ye in 2002 when he was in his mid-20s, had spent at least US$1.7 billion since 2015 buying energy-related businesses in Romania, the United Arab Emirates, Russia and Chad. The company also invested another US$1.2 billion buying financial services assets in the US and the Czech Republic. 

Besides financial services, CEFC has stakes in Czech brewery group Pivovary Lobkowicz, Prague soccer club Slavia Praha, the national airline, hotels and property.

More in the South China Morning Post.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts who can help you in dealing with Chinese investors abroad at the China Speakers Bureau? Do check out this list.

China's answer in US trade war: carefully calibrated - Arthur Kroeber

Arthur Kroeber

China's is sending carefully calibrated messages to the US, as US president Donald Trump is moving to a trade war, tells economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®, to the South China Morning Post.

The South China Morning Post:

Arthur Kroeber, research head and co-founder of Gavekal Dragonomics, said China surely has “an equally specific, but longer”, list of targets ready to go when Washington finally unveils its Section 301 tariff list. 

“The strength of this response was carefully calibrated to send a clear message that Beijing will stand up to the US, but will not try to escalate the spat into a confrontation that could seriously threaten the global trading system,” Kroeber said.

More at the South China Morning Post.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts to make sense out of the US-China trade tension? Do check out this list.

Employment rates: improved but still a political tool - Arthur Kroeber

Arthur Kroeber

China has greatly improved its unemployment statistics, compared to the past, but they still do not give the real picture, says leading economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®, to the South China Morning Post.  State intervention would still be a factor, he said.

The South China Morning Post:

Arthur Kroeber, co-founder and research head of Gavekal Dragonomics, said the broad-based jobless rate was “an improvement” on the previous one. 

The quality of Chinese economic data has been an issue of debate for decades, with independent economists questioning the figures and Beijing defending their reliability. But few indicators have drawn as much criticism as the registered jobless rate – which was 3.9 per cent at the end of last year... 

[N]ot everyone is convinced that Beijing’s new unemployment rate will provide the full picture. 

Kroeber at Gavekal said it did not adequately measure underemployment, such as high-skill workers in low-skill jobs and people in part-time work who would rather be employed full-time. He also said state intervention would still be a factor – Li said in his report that Beijing wanted to keep the rate under 5.5 per cent this year.

More at the South China Morning Post. Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts to manage your China risk, do check out this list.

The global implications of the China-Afrika engagement - Howard French

What are the global implications of the growing China-Afrika engagement, journalist Howard French, author of Everything Under the Heavens: How the Past Helps Shape China's Push for Global Power wonders at the Delaware State University on April 12, 2018.

Howard French is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts at the One Belt, One Road program at the China Speakers Bureau? Do check out this list.   >

China produces one unicorn every three days - Rupert Hoogewerf

Rupert Hoogewerf

Rupert Hoogewerf - chief researcher and founder of the Hurun China Rich List - is a busy man. Every three days, a new unicorn - a company valued over 1 billion US dollar and unlisted - emerges in China, shows his latest report. "If model, talent and capital are all in place, start-ups can move very fast," said Rupert Hoogewerf to the Global Times.

The Global Times:

The total number of such companies stood at 151 as of the end of March, said the report. 

Among 33 newly listed unicorn companies, Tencent Music, a streaming and downloading services provider like Spotify, ranked first in terms of market valuation worth 150 billion yuan ($23.89 billion), followed by JD Logistics with 70 billion yuan. 

Around one-third of the companies are in the internet services sector including Ziroom, an online platform for apartment renting and sharing. 

Next came culture, entertainment and mobility, with Aiways Technology Co, a 1-year-old Shanghai-based internet start-up focused on intelligent and electric vehicles, being the youngest unicorn. 

Aiways said on Sunday that it has secured three rounds of financing totaling 7 billion yuan, industry news site tmtpost.com reported. 

"If model, talent and capital are all in place, start-ups can move very fast," said Rupert Hoogewerf, chairman and chief researcher of the Hurun Research Institute. 

Among all the unicorn companies surveyed by the Hurun report, Ant Financial, an affiliate of Alibaba Group Holding, topped the list with a valuation of 400 billion yuan. 

The financial technology giant is preparing to raise $9 billion in a private funding round ahead of its IPO, which may value the company at about $150 billion, the Wall Street Journal reported on April 10, citing people familiar with the matter.

More in the Global Times.

Rupert Hoogewerf is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more stories by Rupert Hoogewerf? Do check out this list.    

What does China's GDP mean? - Arthur Kroeber

Arthur Kroeber

Media reported widely the 6.8% GDP growth over the first quarter in 2018 in China, but economist Arthur Kroeber wonders what such a number actually means. Also: the impact of the announced US tariffs on Chinese products would hardly make a dent in economic growth, he tells the South China Morning Post.

The South China Morning Post:

Some analysts say the lack of volatility in the range of the GDP figures has reduced the relevance of the data in gauging the health of the world’s second-biggest economy. 

“Do we have a high degree of accuracy in quarter-to-quarter China GDP as other advanced economies? The answer is no,” said Arthur Kroeber, co-founder and research head of Gavekal-Dragonomics, a research firm. “Chinese government calculation about GDP is basically designed to reduce volatility”. 

Kroeber said China’s economic growth rate was expected to slow over the next two or three years and a trade war with the US might knock off about 0.3 percentage points if it involved the US imposing tariffs on US$100 billion worth of Chinese imports.

More in the South China Morning Post.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more financial experts at the China Speakers Bureau? Do check out this list.  

How can you be a China expert without knowing the country? - Shaun Rein

Shaun Rein

China analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order, tells on the EM+BRACE “Mentorship Series” at LinkedIn why he hates some opinion leaders are called China experts without having actually inside knowledge of the country. And why media should be careful position somebody as a China expert.

The EM+BRACE "Mentor Series":

Robert: You’re known for speaking up against analysts who have a bearish view on China, yet don’t know the country firsthand or understand the language. What would you say to those critics who contend that on-the-ground observers, such as you, are missing the forest from the trees? 

Shaun: Look, my biggest problem against some of the bears are not their predictions or lack of understanding China. Rather, how can you call yourself a China expert, like Peter Navarro, Trump's advisor, if you have not visited the country over the past ten years? Or even visited China once, like Jim Chanos, who has been calling for China's economic implosion? I guess these folks are just carving out their niche and trying to get ahead like the rest of us. What I greatly resent is the media for giving these analysts a microphone to talk. At some point, credibility and track record should count for something. How can you quote someone as a China expert who has never lived or barely lived in China? Who does not speak the language? Our media needs to be held to a higher standard. Take Gordon Chang who has predicted the collapse of China for twenty years. He has been wrong on just about every one of his predictions, yet he is constantly quoted by the media as a China expert. Lately, he has been the go-to talking head in the US on North Korea! Gordon is a nice guy frankly. He gives great sound bites and is just trying to get ahead. But the media should look at his track record and not go to him as an expert. 

Robert: Shaun, did you have any mentors during your career. If so, who were/are they and what did you learn from them? 

Shaun: I have been very, very lucky in having some great mentors over the years, ranging from Ambassador Nicholas Platt, to Harvard professor William Kirby, to venture capitalist Gregg Stone. They taught me so many things from how to treat people, take risks, and network, but perhaps what sticks the most is that they were willing to take the time to give me great advice despite being so busy while they were reaching the top of their respective fields. They also taught me that it is important for me to mentor younger people as they did for me — my career never would have been so successful without them. Now it is my turn to give back.

More at the EM+BRACE "Mentor Series".

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts in dealing with your China risk? Do check out this list.

Trump's trade policies good for the year 1818 - Harry Broadman

Harry Broadman

US president Donald Trump's bilateral approach for solving trade issues would have worked in 1818, not in 2018, writes China veteran Harry Broadman in the Gulf News. The US do have serious trade problems with China, but the US would be better off if Trump would be able to create more alliances.

Harry Broadman:

US President Donald Trump sees international trade negotiations as if he was living in 1818 when commerce between countries more often than not was conducted bilaterally. He’s proclaimed on several occasions that he can get a far better bargain taking up trade agreements with other heads of state on a one-to-one basis. 

Indeed, the US Negotiator-in-Chief is “Bilateral Man”, hardly surprising for someone who cut his teeth doing one-off commercial real estate deals within the confines of New York City. 

But this is 2018, and trade consummated even between two countries generally is comprised of multiple intermediate transactions mediated across several national borders. 

Hence, that is why the bedrock rules governing trade agreements today — embodied in the World Trade Organisation (WTO), the successor organisation to the General Agreement on Trade and Tariffs (GATT), which was founded in 1947 — are multilateral in nature and negotiated among sovereign, not business, entities. 

It would appear that the modern — and yes, complex — system of trade agreements is far outside of Trump’s comfort zone, perhaps even his understanding. 

As indicated by his handling of the trade problems between the US and China — which are indeed serious and haven’t been dealt with sufficiently by earlier administrations — his anathema towards building coalitions among the 162 other countries that are WTO members to improve governance of international trade exposes all of us to significant risks.

More in the Gulf News.

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Is the Trump approach of China working? I do not think so - Sara Hsu

Sara Hsu

US president Donald Trump has been going aggressively after China as a trade partner. But is it working? Political analyst Sara Hsu does not think so, she explains in Forbes."From the Boston tea party to the Smoot Hawley tariffs imposed during the Great Depression, protectionist measures have always imposed far higher costs than benefits."

Sara Hsu:

The aggressive Trump stance hasn't worked because Chinese diplomacy is nuanced and officials do not use threats as a negotiation tactic. The Chinese generally negotiate through reciprocity, which is why we saw Xi Jinping making concessions on automobile tariffs. Within the philosophy of Confucianism, Chinese negotiators attempt to avoid conflict and save face, or show mutual respect. Relationship building is essential, and the bonds of the relationship are not meant to be broken. 

If pushed, however, the Chinese often use silence or long negotiation processes as a response tactic. Chinese negotiators may also attempt to use a response that targets the weakness of the counterparty, especially if the counterparty is not viewed as civilized or friendly. The Chinese Thirty-Six Strategems calls for using specific tactics to deal with a hostile party, which including "wait at leisure while the enemy labors" and "watch the fires burning across the river." Chinese officials indeed waited to respond to Trump's bluster and hoped that he would wear himself down by griping and tweeting about his issues with the Asian nation. 

China's strategy appears to be working in the sense that the nation has, to some extent, benefited from Trump's aggressive mentality. Its diplomatic response has been calculated and staid. As Trump rants and raves about China, Chinese officials have emphasized the need for cooperation. It couldn't be clearer who is speaking the voice of reason. If Trump had a better knowledge of economics, he would realize that history has shown that trade showdowns don't work. From the Boston tea party to the Smoot Hawley tariffs imposed during the Great Depression, protectionist measures have always imposed far higher costs than benefits.

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Sara Hsu is a speaker at the China Speakers Bureau. Do you need her at your meeting or conference? Do get in touch or fill in our speakers' request form. 

Are you looking for more experts on the US-China trade war at the China Speakers Bureau? Do check out this list.