...The Risks of Doing Business in China Despite recent measures to curb corruption, foreign investors doing business in China must remain vigilant. Tuesday, June 04, 2013 , By Jim Barratt and Jimmy Ko China's economy is the second-largest in the world and continues to grow at an astonishing rate. Just recently, in fact, the Asian Development Bank forecasted that China's economy will grow by 8.2% this year. However, while economic growth brings business opportunities to all investors, continued widespread corruption in China has affected its government's legitimacy in maintaining prosperity in the region and can bring a multitude of risks to financial services companies that are doing business there. With China's recent transition to new leadership complete, it has been interesting to observe the ruling party's heightened focus on tackling corruption. Under China's new president, Xi Jinping, it has conducted a visible anti-corruption drive and imposed austerity measures in an effort to curb the display of wealth by government officials and generate goodwill among the Chinese population. While critics say that the recent measures target only the most conspicuous displays of wealth by government officials, the anti-corruption drive has already netted dozens of officials. Moreover, some perceive that the recent election of Wang Qishan as the new head of China's anti-graft body, the Central Commission for Discipline Inspection (CCDI), signals that the financial sector could...
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...Doing Business in the 21st Century with the New Generation of Chinese Managers: A Study of Generational Shifts in Work Values in China Author(s): David A. Ralston, Carolyn P. Egri, Sally Stewart, Robert H. Terpstra and Yu Kaicheng Reviewed work(s): Source: Journal of International Business Studies, Vol. 30, No. 2 (2nd Qtr., 1999), pp. 415-427 Published by: Palgrave Macmillan Journals Stable URL: http://www.jstor.org/stable/155320 . Accessed: 30/01/2013 16:57 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. . Palgrave Macmillan Journals is collaborating with JSTOR to digitize, preserve and extend access to Journal of International Business Studies. http://www.jstor.org This content downloaded on Wed, 30 Jan 2013 16:57:29 PM All use subject to JSTOR Terms and Conditions Doing the A New Business Generation in the of 21st Century with Chinese Shifts Managers: in Study of Generational Work China Values in DavidA. Ralston* UNIVERSITY OF OKLAHOMA P. Carolyn Egri** SIMON...
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...DOING BUSINESS IN CHINA: The Human Rights Challenge CONTENTS I. INTRODUCTION China: World Economic and Manufacturing Centre Why Are Human Rights so Important for International Business? Chinese Legislation: Gap Between Theory and Practice p. 3 p. 4 p. 6 II. SPECIFIC ISSUES AND RECOMMENDATIONS 1. Freedom of Association, the Right to Form and Join Trade Unions, and Collective Bargaining 2. Working Conditions 3. Discrimination 4. Forced Labour 5. Forced Evictions 6. The Rights of Children 7. The Right to Freedom of Expression and Information p. 8 p. 12 p. 16 p. 20 p. 23 p. 26 p. 29 p. 32 p. 33 p. 34 p. 37 III. GENERAL RECOMMENDATIONS TO COMPANIES IV. CONCLUSION V. LEGAL STANDARDS AND SOURCES VI. CONTACT ADDRESSES 2 I. INTRODUCTION China: World Economic and Manufacturing Centre Over the years China has become one of the largest economies in the world and the manufacturing centre of the world. Since the seventies, China has sought joint venture partners and encouraged technology transfer through foreign investment. Chinese firms are successfully manufacturing products on behalf of numerous foreign companies. The Chinese government provides massive contracts to foreign firms in order to build up the infrastructure required for its industrialization. Many companies establish distribution networks in China in order to benefit from the large home-market and increasing purchasing power of Chinese consumers. Last but not least, in 2008 China organized the first...
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...Address the unique challenges of doing business in China, with special emphasis on cultural issues (ie. Dos and donts) Our instructor says he is going to email Jelena the slide with the China information for Hofesede. China Organization Culture 1. Highly collectivist 2. Highly Masculine 3. High power-distance 4. Low on uncertainty avoidance 5. Respect for Age 6. Hierarchical 7. Relationship oriented 8. Maintain harmony 9. Holistic Thinking 10. Circular China ranks the highest in Long-Term Orientation. This is due to strong beliefs, respect for tradition, reciprocity and perseverance. http://www.china-nafsa.aief-usa.org/culture/differences.htm CHINESE AMERICANS Conception Of the Self Collectivist: Higher value placed on group cooperation and individual modesty. Individualist: Higher value placed on self-reliance. Self-promotion is more accepted. High value placed on "freedom" from externally imposed constraints. Social Relationships Formal, hierarchical. People most comfortable in the presence of a hierarchy in which they know their position and the customs/rules for behavior in the situation. Informal, egalitarian. People most comfortable with their social equals; importance of social rankings minimized. Friendship Small number of close, lifelong friends who feel deeply obligated to give each other whatever help might seem required. Large collection of "friends" and acquaintances which changes over time and involves only limited mutual obligations...
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...investment projects Acme is considering doing in China. Acme is a US firm that plans to focus on investing in and penetrating markets in China. It will discuss the potential profits as well as the policies that are currently in effect in China. It will give the information on the factors that would be used to consider doing business in China such as import/export restrictions, labor relations, supplier financing, tax rules, etc. Global Financial Management Introduction A long-term investment, which includes stocks, bonds, real estate, and cash, is an account on a company’s asset side of the balance sheet that represents an investment the company intends to hold on to for more than a year (Definition, 2013). The US firm, Acme, wants to focus on investing in markets in China. There are many factors to consider when doing business in any foreign country, China is no different. The first bit of information to look at is the back ground of China. China, whose capital and focal point is Beijing, with over 4,000 years of verifiable history, is believed to have the oldest continuous civilization. The official language of China, which is derived from a Mandarin dialect, is Chinese. China is a Communist country that promotes atheism and a constitution that guarantees freedom of religion (China Introduction, 2013). Culture The second bit of information to look at is the appearance, behaviors, manners, and communications that China businessmen expect to see. The appearance...
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...rights violation in China and Google’s dilemma. Companies deal with ethical conflicts with China daily. Google Inc.’s struggled with ethical implications for doing business with China. The paper addresses the ethical problems that companies like Google, Inc. encountered that caused their decision to withdraw from China. The paper will show how Vietnam covered up corruption, freedom of speech, transparency, and supply chain ethical issues. Big companies continue to draw criticism for accommodating governments and compromise their ethical or moral standards. Companies have an enormous opportunity in China to make a bigger profit by doing business in China. The organization cannot assume that Chinese do business the same way Americans do. To do business in China a company has to follow government directives. Chinese want to do business with people they trust. Terms on contracts will not mean the same thing to them as they do to Americans. Chinese businesses do not feel they are bound to contracts. In America a company competes with 100’s of business but in China, you are competing with globally. Google Inc’s announce in Beijing their decision to withdraw from China after ethical implications of hacking into the privacy of Google’s users. Google had to limit the excess of information on the search engine in China. China does not hold to the same freedom of speech American do. Free speech advocates criticized Cisco Systems, inc. for selling equipment to China that blocks Web sites...
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...Cultural Environment of China Nowadays, the core of economic is move gradually from America to China. However, not many business people are familiar with Chinese culture, so study the cultural environment of China become the first mission. Business people will contact with Chinese business people and officials, so they have to understand Chinese culture deep enough. Below will list a few cultural facts in China. Giving Gift Etiquette "Unlike many countries, the giving of gifts does not carry any negative connotations when doing business in China."(2012) In, China exchanged gifts in a celebrations as a thanks for assistance. In addition, the business gifts should be always reciprocated. They will make a same value gift to reciprocate. Therefore, do not be an iron rooster for the gift given to Chinese business people. Face "Roughly translated as 'good reputation', 'respect' or 'honour,' one must learn the subtleties of the concept and understand the possible impact it could have on your doing business in China."(2012) There are some categories of the face situation. "1) where one's face is lessened through their involvement in an action or deed and it being exposed. The loss of face is not the result of the action, but rather it's being made public knowledge. when face is given to others through compliments and respect. 3) face is developed through experience and age. When one shows wisdom in action by avoiding mistakes their face is increased. 4) where face is increased...
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...BSB 119 Assignment Lazybones Case Study Global Business 5.0 Business Environment. The business environments of China and India impact how Lazybones will conduct potential operations, and must therefore be investigated. 5.1 Free Trade Agreements. After 21 rounds of negotiations beginning in 2005, on 17 June 2015 the China-Australia free trade agreement was signed; worth almost $160 Billion (Dfat,2015).The Agreement secures better market access for Australia to the world’s second largest economy, improves our competitive position in a rapidly growing market, and promotes increased two-way investment and reduces import costs (Trade,2015).More than 85 per cent of Australian goods exports will be tariff free, rising to 95 per cent on full implementation.(Trade,2015).China is our biggest export and import market(Dfat,2015). This FTA will only strengthen our country’s relationship, giving us most favoured nation status by helping Australian companies to conduct operation with China.This will greatly benefit Lazybones potential manufacturing sourcing as it will ease the implementation and business relations within China because of our strong relationship. The FTA will ease the barrier to entry for Lazybones in China as the company can capitalise on the political and economic ties Australia has, which ultimately builds business relations and growth. (Image-Retrieved from Austrade 2014) A comprehensive...
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...Overview China and India provide vast opportunities for trade and investments in all major sectors. In the next few decades, China and India will join the U.S to become the three largest economies in the world. China and India will provide enormous upside potential for U.S. firms, as well as risks. Cultural System Doing business in a particular nation needs a multi-dimensional understanding of its culture and business practices. Understanding those differences and adapting to them is the key factor. India The Indian economy has been booming for the past few years. The country holds great promise for the future. The business culture of India is a reflection of the various norms and standards followed by its’ people. Indians have various cultural yardsticks, which extend to their business culture too. I found the following culture norms to be important: 1. “The ‘Namaste’ forms an important part of Indian etiquette and is generally used while greeting and saying good-bye. This gesture is performed by pressing the palms of both hands together (fingers up).” However, educated Indian men and women, who are acquainted with western customs, prefer shaking hands. Moreover, while greeting any individual use his or her title. To mark respect, you may also add a suffix ‘ji’ to the name of a person. 2. In India, companies follow a hierarchical system and the decision making is usually from the top to bottom. Business decisions could be at times time consuming, and International...
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...Ana María Hoyos Business Law in China and India Which is more appealing to Latin America? The economy of the United States has been slowing down during the past years, leaving Latin American economies with no alternative but to look into further horizons. Both China and India have been growing and flourishing into attractive alternatives for Latin American businesses. These two fast-growing developing economies represent a great opportunity for Latin American countries especially because both India and China have showed their interest in doing business with Latin America. Additionally, the recent boom of Latin American leftist governments that are not fond of the United States has minimized the gap between the western south and these two Easter giants, increasing the need for joint business ventures and trading partnerships that contribute to the growth of China, India and Latin America. In order to evaluate the relation of Latin American countries with China and India, it is important to analyze the legal systems and regulatory business environments of the Chinese and Indian governments. By developing a concise comparison between China and India, this paper will eventually evaluate which country has more to offer to Latin American economies. Such comparison will be based upon aspects such as legal backgrounds and traditions, basic business regulations, trade laws and others, to finally conclude what sort of government is more appealing to Latin American economies. ...
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...CAFÉ: THE CHINA CHALLENGE SPRING 2015 The following are the guidelines for completing the case analysis for Levendary Café: 1. Read the case carefully to gain a good understanding of the case and all the issues facing the company. 2. Identify the Environmental Factors (Political, Legal, and Technical) that exist in China and that have an impact of how business is conducted in China compared to how it is conducted in the United States. Focus on the ones that specifically affect the business that Levendary Café is in. What are these factors and how specifically do they affect Levendary Café’s business in China. 3. Identify the Economic and Demographic factors that exist in China and discuss how they affect Levendary Cafés business in China. 4. Identify the major Cultural Differences between the U.S. and China, and explain how they affect doing business in China for Levendary Café. 5. Identify differences in Ethical practices and values between the U.S. and China and explain how these differences affect doing business in China. Focus on those differences that affect the business that Levendary Café is in. 6. Using Hofstede’s Cultural Dimensions, compare the U.S. with China and explain how the differences would affect doing business in China for Levendary Café. 7. Based on the Cultural differences between the U.S. and China and the Hofstede’s Cultural Dimensions analysis, what is the most effective way for Levendary Café to manage its China operations...
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...Introduction This report shall focus on China as the world’s largest emerging market, examining how managerial practice in China differs from Western practice. This report shall attempt to offer guidance to managers operating in China, taking into consideration issues outside their normal experience, for example government regulation and cultural differences. According to Justin Lin, The World Bank's chief economist, China, which became the world's second largest economy in 2010, may become the world's largest economy in 2030, overtaking the United States, if current trends continue. Taking this into consideration we can see that not only is China the world’s main production market but also the world’s centre for consumption. It is crucial that western businesses and managers understand how to do business in China and the issues they may face in management practice in an international and cross-cultural context. Political and regulatory considerations for doing business in China, Anti-gifting regulations in China The giving of gifts is an essential part of Chinese culture (Yang 1988). Personal and corporate gifts accounted for approximately 25% of luxury goods sales in China in 2012. Bain et al (2013) This sale percentage is now at risk as the Chinese government attempts to combat both the act of corruption and a negative view among the population of the behaviour of politicians. As part of the anti-corruption campaign, in July 2012, the State Council passed regulations...
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...what makes up the population of every country in the world. It is one of the many things that makes us all different. When doing business with other countries it is a real gullible state of mind to think that all people in all places all have the same behaviors and ways of doing things. People should not be confused or taken for granted because they wear the same designer jeans, name brand shoes, or even speak the same language as they do. Same scenario when doing business, even more so if that business is to be done in another country or with someone with a different cultural background. Things such as higher levels of sensitivity, being more detail oriented or simple differences like their patterns of behavior can make a huge difference in some other culture (Drew, 2013). If you want to succeed in the cross-cultural business world of negotiations you must completely understand others, and using that knowledge to your advantage to recognize the desires of all parties involved; and then develop a situation that becomes a win-win setting for everyone involved. It is wise to keep in mind, that when doing cross-cultural business, the methods or approaches of the domestic could be different and may not apply if they are not culturally accepted by the other party (Drew, 2013). Some of the most common things you should know before negotiating business with another culture are as follows:...
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...How Mc.Donalds run their business in China? Mc.Donalds penetrated the Chinese marke t in 1990. The number of Mc.Donalds store increase d to 500 during the thirteen-year perio d 1990-2003 in China. The number of Mc.Donalds store increase d to 500 during the only five-year peri od 2003-2008 in China. Now there are 1300 Mc.Donalds stores in China. How Mc.Donalds run their business in China? Mc.Donalds continued the operating poli cies and Americanized traditions in its early days in China. Mc.Donalds waited until the right time for moving aggressively into Chinese market. Mc.Donalds has been unable to take much market share from KFC in China. Mc.Donalds compiles the information about the rival company. How Mc.Donalds run their business in China? Mc.Donalds aims to expand their's chain stores in China. Mc.Donalds's brand image will be redesigned to suit preference of the chinese market. Mc.Donalds will newly open casual and European-style stores so that they will achieve brand differentiation in t he market How Mc.Donalds run their business in china? Mc.Donalds is planning to increase the number of its round-the-clock stores. More than half of the new stores will be planed to open are drive through outlet. Mc.Donalds is planning to increase the number of store offer delivery service. Mc.Donalds's service coverage expand to the area where they have already entered. How Mc.Donalds run their business in china? Mc.Donalds sell special products which is for a limited...
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...Introduction Emerging markets by definition are developing economies that exhibit sustained economic reform and growth, no doubt China has experienced both. In fact China, with more than 1.3 billion people, is the world’s most populous country and has a rapidly growing economy (Doh & Luthans, 2012). One would think that their dual status as it pertains to both communism and capitalism would be a deterrent to doing business in the People’s Republic of China, and in many cases cease long term global integration into China’s market, this has not occurred and probably won’t because the results of expanding in the Chinese market out weighs the challenges that are met. Continued forecast and optimistic projections still make doing business in China favorable and the most viable option to remain competitive in today’s global economy. The key to success or failure when entering a foreign market consist of careful examination, and identification of all potential problems regarding an organization’s culture, economic environment, political risks and social climate. Additionally, a comprehensive strategy has to be in place to overcome objections and make adjustments. Understanding the differences from a political, economical, social and cultural aspect as well as the ability to respond to different national standards and regulations are key factors. The Chinese Culture Culture is defined as the sum total of beliefs, rules, techniques, institutions, and artifices that characterize...
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