In this article from the Financial Times, Martin Wolf writes about a recent trip to China. Martin was somewhat critical of people like us who try to explain what China is thinking and intends. It is very valuable that he now writes about what he thinks China is doing. He is an intelligent and capable man, and his insights are worth reading, even if he limits his analysis to avoid any sense of identification.
His main point is the same as the 48 Group’s. This is what I see as China so how should the West respond. Containment and defeat are likely not options, apart from having a moral ambiguity. His point seems to be what are our shortcomings, what do we need to change, and how do we benefit from the China rise, and manage the challenges.
That story of how to work with China for those twin purposes is just beginning. Successive governments have managed China by annual meetings of various types. They have ignored what China really is, or seen what they wanted to see. China is very complex and yet simple. The opportunities, if embarked upon in the right ways, are vast and choosing the right ones is the lesson of many multinational corporations. The challenges are also many and the time honoured approach of rushing is a huge danger.
China’s research is phenomenal and its polices are often borne out of observing Western experience rather than Marxism or Chinese history.
China’s approach to negotiations, as the USA is about to find out again, is legendary and always surprising.
Martin captures some of the key themes, and his shorthand is clearly in good shape
and here is another story.
At first glance it looks like a story of a Chinese mistake. Some, myself included, thought Chinese buying House of Fraser was a mistake. Here we have a Chinese retailer buying the stake of a Chinese investor. This is about China buying into British retailing.
Compare this long term policy with British retailers who ventured naively into China 10 – 15 years ago.
What is the difference? China never thought they needed western retailers to develop their consumer demand. They did value learning about their techniques and systems, but they had a good handle on their buying and felt the foreign markets were very different from theirs. We warned those who would listen.
The Chinese are coming to Europe as they realise the largest value component of the end price of their exports is in the hands of the retailer. And they will have more direct understanding of the market this way. But it has to be a 20-30 year policy – the scientific method. Which retailers of the West have China targeted?
Interesting times but ones which will bring us more competition and better prices