Table of Contents:

China External Guides to China: Venture Capital in China Business Culture in emerging markets Business Centers in China Beijing, China Yangtze River Pearl River Delta Pan-Pearl River Delta (9+2) Macau Shezhen Entering the China market A Representative Office Joint Venture Wholly Foreign Owned Enterprise (WFOE) Some curios observations: China as an export base Florida companies perspective: Beyond Cheap Labor: Trade Show Events Furniture Other Products Media CURRENCY: Export International Property Rights (IPRs) How Chinese view the rest of the world Arranging meetings in China Business Etiquette Acceptable Public Behaviors Giving gifts to Chinese Health Matters Beijing Shanghai Arriving in China ATM - money Getting Around Crime and Safety Suggested Reading China / USA relations More info about China

 

China

 

China introduced market reforms in the early 1980s; only a third of the economy is now directly state-controlled. Since joining the World Trade Organisation in 2001, China has rapidly become a global economic force, doubling its share of global manufacturing output, creating a commodity-market boom and accumulating $1 trillion of foreign-exchange reserves. Rural areas are lagging, but coastal areas have seen the rise of a vast middle class. Growth has not necessarily meant greater transparency: the banking sector remains especially murky. China also desperately needs accountants to help its companies meet international financial-reporting standards. China's central bank hopes to stop the economy from overheating. In July 2005 China unpegged the yuan from the dollar—although American congressmen think the yuan still needs revaluation.

 

Travel info: http://youstravelers.pbwiki.com/China

 

 

External Guides to China:

 

course from MSU:  Doing Business in China: The China module should provide one with a general understanding of the following: China’s market potential and hot industries; its culture and people; common situations that arise when conducting business in China; current obstacles and opportunities in logistics; the historical and current problems faced by the economy; and economic and political factors that affect the costs of doing business in China. A case study focusing on China’s rural dilemma is incorporated into this module. Catoregy: Doing Business In 

 

 

Customs related Info

http://www.bitd.org/

http://www.unctad-trains.org/

http://www.macmap.org/

http://www.wcoomd.org/ie/index.html

 

Container Sizes and Capacity

http://www.australiatrade.com.au/Shipping/ContainerSizeSales/index.htm

 

Exchange Rates:

http://www.x-rates.com/calculator.html

 

HS Codes List:

http://www.wcoomd.org

 

Corporate Responsibility

Sino Strategic's roots are from Sustainable Development of SMEs (Small & Medium Enterprises). While our business is largely based around helping medium sized companies achieve their goals successfully, Sino Strategic gives a percentage of profits to worthy help organisations such as ECSATLANKA.

http://www.ecsatlanka.org/index.html

 

Inspection for chemical content and stability:

API website.

http://www.api-hk.com

 

Inco Terms Explanation:

http://www.iccwbo.org/incoterms/id3040/index.html

http://www.unipacshipping.com/tools_glossary.asp

 

Sourcing sites:

China web-sourcing links. While very useful in determining what products are currently in production in China and finding factories in particular fields, the limitations of this mode of supply soon become apparent when you attempt to negotiate prices, quality or production issues. These links are tools with which one can begin to understand the complex world of manufacturing in China.

http://www.alibaba.com/

http://www.tradekey.com/

http://www.made-in-china.com/

 

Trade shows

http://tradeshow.alibaba.com/

 

China Business Infocenter

http://www.cbiz.cn/

 

China News Information

http://www.chinadaily.com.cn/

 

 

 

Venture Capital in China

Venture Capital in China

 

 

 

 

 

 

Business Centers in China

 

 

Beijing, China

 

“If you want to do business in China, you eventually need to go to Beijing." Because China is a strong socialist state, with a very powerful central government with one party rule (the "communist" party), it is essential that you develop good relations in Beijing if you hope to successfully enter the Chinese market with your goods or services (or manufacturing facility). If you are just looking to purchase goods from China for export, however, you wont need to pay as close attention to relations with Beijing, and should move on to Shanghai, Shezhen, Chongqiing,etc (see below)

 

 

Yangtze River

 

 

Shanghai, China

 

Shanghai is the business capital of the new China. In a way, if Beijing is similar to Washington DC, then Shanghai is similar to New York City. Situated on the delta of the important Yangtze river, Shanghai is located right in the center of China's important east coast. The central location of Shanghai means that you can use the city as the hub for commerical activity and reach all parts of the country easily by air, train, bus, or water. The Yangtze river delta is one of the most important river deltas in the world. The population living along the Yangtze is approximately 320 million people (more than in the entire United States!).

 

Shanghai is a center for banking, manufacture, and shipping / logistics.

 

Shanghai is often described as the head of the dragon. The dragon referred to of course, is the Yangtze River. This is another way of making the point that Shanghai is the gateway to central and southwest China and all it has to offer. Depending upon how they are counted, there are somewhere between 360 million and 410 million between Shanghai and the Chongqing-Chengdu corridor. This includes the Yangtze River Delta area and the provinces that lie along the path of the Yangtze River to Chongqing. The cities of these provinces feed into the Yangtze River and in a very real sense, create a unique economic unit.

 

There is little doubt that Shanghai has become the driver for future development of the Yangtze River Delta area. Shanghai may become even more key to the successful development of the entire Yangtze area once the deepwater port is completed. Three factors will continue to drive Shanghai�s growth as a trade gateway through the next decade.

 

 

 

The Yangtze River Delta (YRD)

covers the area from Shanghai to Nanjing and includes the provinces of Zhejiang to the South and Jiangsu to the North. The key cities of the Yangtze River Delta include Shanghai, Nanjing, Ningbo and Hangzhou. The YRD accounted for 23.5% of China�s industrial production and 17.2% of the country�s GDP in 2002. This was accomplished by only 6.2% of China�s population using only 1% of the nation�s land. The Yangtze River Delta area is where most of the manufacturing base supporting U.S. retailers have set up operations. Cities like Suzhou, Wuxi, and Hangzhou have overnight been transformed from farmlands to manufacturing centers.

 

 

It has only been since the 90s that Shanghai began pursuing a more aggressive stance to support the development of the city as a trade center with the creation and opening of the special economic zone in Pudong. In 1996, Shanghai�s role was expanded with the creation of the Shanghai Combined Port Authority (SCPA) which was established as a cross regional authority to coordinate port development activities in Shanghai and the ports located in the provinces of Jiansu and Zhejiang. This is what is now often referred to as the Yangtze River Delta.

 

Three important developments that are converging to influence a major restructuring of China's transportation infrastructure:

 

1. The rising costs in manufacturing in South China Cities which will drive manufacturing north to Shanghai and the surrounding area.

2. The China government's new "Go West" policy which is intended to encourage development in the western areas of China. This is a necessary step if China is to balance the economy. Most of the development thus far, has been in the southern and coastal provinces.

3. The completion of the Three Gorges Dam. The completion of this project will over time, raise the water levels which is needed to make the Yangtze River navigable to larger vessels as far west as Chongqing.

 

 

Chongqing, China (major city in interior)

 

Exports are made from Chongqing via the Yangtze River which flows west to east across China, and meets the ocean at Shanghai. To export motorcycles, for example, the Chinese load the 40’containers on small boats in Chongqing and send them to Shanghai where they are loaded on larger vessels. The reason for having to ship by smaller boats is that some of the bridges along the way are very old, and are too low for big ships to pass under.

Upper Yangtze River

 

When one looks at a map of China, it may be asked why Chongqing and cities to Yichang should be considered the Upper Yangtze River. Geographically, Chongqing is located in the lower Yangtze River. Chongqing is the furthermost point west of Shanghai that can handle cargo vessels with a supporting infrastructure that allows companies to distribute their goods to other cities in China. Though there are a few small cities further West along the Yangtze River, Chongqing is considered the gateway for Southwest China and for the most part, the area further west along the Yangtze is not navigable by vessel. The Upper Yangtze River can be defined as the upper reaches of the lower Yangtze River which covers the area from Chongqing to Yichang to include Chendu and cities of the Sichuan Province.

 

The potential of the upper Yangtze River is far from being understood or realized. One little known fact that seems to be lost on the rest of the world is that Chongqing is technically the world�s largest city with a population of 31 million people. Made a municipality in 1997, Chongqing is now one of four municipalities to include Beijing, Tianjin and Shanghai. This should underscore the importance the China government places on Chongqing and the development of Western China. Just as important, is the location, strategically situated as a gateway to Southwest China. The population along the Upper Yangtze River which includes the Province of Sichuan and Municipality of Chingqing is approximately 115 million people. With the completion of the Three Gorges Dam in June of 2003, a renaissance has begun that will transform the upper Yangtze River into a productive manufacturing and agricultural mecca.

 

Both the local and central governments are aggressively pursuing an investment and development strategy to connect this region with the key international gateways in China. Investments in new roads, railways, airports and port facilities are currently under construction to support the migration of manufacturing and logistics development to this Southwest China. For example; in 2000, there were no container facilities to handle the movement of containers in and out of Chonqing and the ports along the Upper Yangtze River. Most barges handled primarily breakbulk. In 2003, Chongqing port will have a throughput of approximately 95,000TEU. What is more amazing, is that the current plan supports the expansion of the current terminal to handle more containers and the construction of a new terminal that together will have a design capacity of 700,000TEU throughput by 2009.

 

 

In China, there are "clusters" of manufacturing, or areas of concentration where many manufacturers congregate. For example, in Chongqing, there is a cluster of motorcycle manufacturers that has sprung up over the past 10 years or so. It originated when Honda outsourced production in this city with one factory, and has since sprouted 30 or more competing motorcycle factories all in town. There are 5 major 1st tier players, 5 minor 2nd tier players, and many small operations. Most of the motorcycles are made for export as Chinese consumers do not trust the smaller players and only purchase from reputable brands.

 

There seems to be too much competition which drives prices so low that even the Chinese motorcycle companies have extreme difficulty making profits. More and more companies enter the manufacturing market and compete for the same customers that it drives the prices down. In part, this explains why China can manufacture goods so cheaply. They are hyper-competitive. There are so many people what when one of them gets a good idea and starts manufacturing motorcycles in a town, then suddenly everyone in that town gets the same idea and also starts making motorcycles as well (or shoes, or furniture, or ties, etc). But how do they all suddenly get the money to do this? Its easy; the Chinese government banks are so full of cash that they don’t know what to do with the excess liquidity. The 4 major banks are all government run, and make all of the decisions about lending. Rather than a market driven lending economy, the Chinese have a state central planning mechanism. So, if the state chooses to lend, they will with little regard to the balance sheets or profit margins of the individual players. With excess liquidity and questionable government lending, the Chinese entrepreneurs find it relatively easy to find support for construction of manufacturing facilities, especially if the intended market is for export. The result is that a town like Chongqing, China ends up with over 30 motorcycle manufactures, and incredible prices.

 

 

 

 

Bicycles, Scooters and Motorcycles

 

It’s interesting that you see no motorcycles in cities such as Beijing, and very few in Shanghai. The reason for the lack of motorcycles is that the government makes it very difficult and expensive to get the license for them in the cities. As a result, most of the motorcycles in China are found in the countryside. The official reason given for this policy is “pollution”, but to me it seems that cars must cause just as much. In China, you will find many, many bicycles, scooters, and electric bikes. There are even special lanes made for bicycles throughout most major cities (image if half of the roads in Manhattan were specially designed for bicycles, and you have an idea about the roads in Shanghai and Beijing).

 

The three top motorcycle brands in China are foreign, but the top 3 bicycle brands are Chinese. Of the motorcycle brands that compete in China, most of the designs are based on (copied from) Japanese manufacturers such as Honda.

 

 

Central Yangtze River

 

The central Yangtze River includes cities from Yueyang through Wuhan to Wuhu and winds through the Provinces of Hubei, Hunan and Anhui. Wuhan may be the most important cityin the Central Yangtze Region. Wuhan is strategically located, central to both the east-west flows of the Yangtze River connecting

 

Chongqing to Shanghai and the north south rail line connecting Beijing in the north with Guangzhou in the south. Wuhan might very well become the Chicago of China. Historically, Wuhan has been considered the gateway to nine provinces. Companies like Anheuser Busch have located here and handle their distribution throughout China from a single location. Using the Yangtze River for east-west traffic and and the rail lines for north-south traffic, Anheuser Busch can distribute product to most major cities in China. A little known fact in the U.S., is that Anheuser Busch now has 50% of the premium beer market in China. They have accomplished this using a single location to distribute product to their distributors.

 

The central Yangtze River region is noticeably more active than the upper reaches. This is in part, due to fact that larger vessels can call Wuhan vs. Chongqing, Wanzhou and Yichang. Wuhan can handle up to 5,000 ton vessels. As we moved down river from the upper Yangtze, we could sense the increased activity. There is also a more diverse manufacturing base in the central region. Sophisticated special economic zones are either being constructed or in the final stages of completion. Both Jiujiang and Wuhu have sophisticated plans for the development of side by side manufacturing and logistics facilities.

 

 

 

Pearl River Delta

 

 

The Pearl River Delta includes Hong Kong, Macau and part of Guangdong province (including the nine municipalities of Dongguan, Foshan, Guangzhou, Huizhou, Jiangmen, Shenzhen, Zhaoqing, Zhongshan and Zhuhai), and is a region which was opened up to commerce and foreign investment in 1978 by the central government of the People’s Republic of China.

 

Hong Kong and Macau quickly made use of that opening up to transfer their industrial base to Guangdong province, currently the wealthiest in all of China, keeping management, communications, logistics, finances and professional services within their respective territories. Lower labor costs on the other side of the border also gave Hong Kong and Macau a competitive edge.

 

 

 

As a result of the Beijing government’s decision, Guangdong became one of the most important industrial bases in the world, providing work for over 10 million people, while Hong Kong and Macau became cities focused on internationally renowned services.

 

The province is the wealthiest in the whole of China and is also the one which shows the most rapid development. It is estimated that just from Hong Kong more than 53,000 of the total 59,000 companies that the SAR had in continental China have moved their industrial units to Guangdong , particularly to the special economic area of Shenzhen ( Hong Kong ). In Macau the transfer was to the special economic area of Zhuhai.

 

Consecutive years of investment and development of infrastructures have given the Pearl River Delta a global and reliable transport network including airports, railroads, ports, highways and waterways. There are five airports, including international airports in Hong Kong , Canton and Macau . All the cities within the Delta are linked by highways and there are still projects to be finished such as the Zhuhai-Macau-Hong Kong road link.

 

The Pearl River Delta economic area continues to be the main exporter and importer of all the great regions of China , and can even be defined as an economic power. In 2002 exports from the Delta to regions other than Hong Kong , Macau and continental China reached USD 160 billion.

 

In 2003, imports and exports from and into Guangdong province totaled USD 283.64 billion, or 33 percent of the country’s total, placing the province in first place for the eighteenth year in a row. In the same year exports reached USD 152.94 billion, or 34.9 percent of the national total.

 

The Pearl River Delta, despite accounting for just 0.5 percent of the total Chinese territory and having just 5 percent of its population, generates 20 percent of the country’s GDP.

 

The population of the Pearl River Delta, now estimated at 50 million people, is expected to grow to 75 million within a decade.

 

Apart from investment from Macau and Hong Kong companies in the rest of the Delta, the Province of Guangdong has, for the last 20 years, been the focus of direct foreign investment, much of which from North American companies looking to make use of the same competitive edge enjoyed by Macau and Hong Kong .

 

 

 

Pan-Pearl River Delta (9+2)

 

 

The Pan-Pearl River Delta (PPRD), China 's most extensive regional alliance, mutually beneficial economic structure that will take to the forefront of China 's booming development.

 

PPRD is also known as the 9+2, Fujian , Jiangxi , Hunan , Guangdong , Guangxi, Hainan , Sichuan , Guizhou and Yunnan , plus Hongkong and Macao special administrative regions.

 

These eight provinces and one autonomous region make up one fifth of the area, one third of the population, and one third the economic aggregate of China .

 

Zhang Dejiang, secretary of CPC Guangdong Provincial Committee, first proposed Pan-Pearl River Delta regional cooperation in July 2003.

 

It won the central government's full support and encouragement, evoked positive response among the provinces, the autonomous region, Hongkong and Macao , and gained through-going social approval.

 

The eight provinces and one autonomous region have achieved tremendous inter-provincial cooperative breakthroughs in the economic and technological.

 

Hong Kong and Macao 's role within PPDR is to promote the eight provinces and one autonomous region's manufacturing industry. This will be accomplished by Hong Kong enacting its role as main world service center and Macao performing the function of regional business and trade service platform.

 

Regional cooperative development apart, the Pan-Pearl River Delta also aims at the international market.

 

It was the establishment and development of Sino-ASEAN (Association of Southeast Asian Nations) Free Trade Zone that motivated Guangdong Province and its peripheral areas to break borders and enhance trade relations to become a true bridgehead.

 

Economic and trade cooperation between the nine provinces/autonomous region and Hong Kong and Macao special administrative regions is also brisk.

 

In 2003, total trade volume between the two SARs and the nine inland PPRD participants amounted to US $65.1 billion, representing 72 percent of total trade between the inland and the two SARs.

 

In the same period, the nine inland localities absorbed US $7.8 billion in direct investment from Hong Kong and Macao , accounting for 43 percent of the inland total.

 

Vice Minister of Commerce An Min pointed out that geographical advantages of the nine inland localities in the Pan-Pearl River Delta are evidenced by their active cooperation with the two SARs.

 

The Pan-Pearl River Delta (9 inland localities + 2 SARs) accounts for one-fifth of the national territory and one-third of the national GDP.

 

Its population is equal to that of the EU. Close cooperation has evolved as a result of development trends in the region and reflects the projected essence of the Pan-Pearl River Delta Economic Sphere as proposed a year ago by Zhang Dejiang, secretary of CPC Guangdong Provincial Committee.

 

Zhang suggested that Guangdong , Hong Kong and Macao enlarge their scale of strategic economic integration in southern China to include the South and Southwest. The resultant stronger functional advantages and consolidated comprehensive strength constitute an engine for China 's economic boom.

 

The Pan-Pearl River Delta Regional Cooperation will set an example for regional economic cooperation within China and around the world.

 

Macau

 

 

Macau, which was colonized by the Portuguese in the 16th Century, became the first European trading outpost in the Far East . Following an agreement between China and Portugal , Macau became a Special Administrative Region of China on December 20, 1999 .

 

At the time, Beijing vowed that Macau would have a high level of autonomy on every issue except foreign relations and defense.

 

Macau has a population of 503,000 people and an average life expectancy of 79 years. The territory is located in the South of China, in the Pearl River Delta some 60 kilometers from Hong Kong and has an area of around 25 square kilometers.

 

As a tourist destination Macau received 18 million people in 2005 and visitors from Hong Kong , Continental China and Taiwan accounted for the vast majority of those.

 

The fact that Macau is fast becoming the “ Las Vegas of the Orient,” following the end of the gaming concession monopoly, has given the local Government ever-growing revenues. According to official figures, revenues from gaming totaled 7.76 billion patacas in 2002, a figure which increased to 16.56 billion patacas in 2005.

 

Currently Macau has 20 casinos but this number is expected to increase to 26 by the end of 2006.

 

Macau ’s traditional industries, including clothing and textiles have been losing their importance in the territory’s economy.

 

In July 2005 UNESCO designated Macau ’s historical centre as a World Heritage Site

 

http://www.gov.mo/

 

 

 

 

Shezhen

http://www.shenzhenwindow.net/home.htm

 

 

 

 

 

 

Entering the China market

 

For the past 25 years Howard Ullman has seen business head almost exclusively in one direction: from Chinese factories to U.S. consumers. But recently, his Cooper City trading firm, which imports Chinese goods and helps U.S. companies find Chinese manufacturers, has been trying to flip that equation.

 

For the first time, China Direct Trading is working with four U.S. firms that are trying to sell their wares to China, he said. For years you couldn't get into the Chinese market, said Ullman, who is working with a medical device manufacturer, a construction supply company and a maker of educational tools. But the pendulum is starting to swing in the other direction.

 

For decades, breaking into the Chinese market was reserved for Fortune 500 companies and firms with deep pockets. But since China joined the World Trade Organization in 2001, more opportunities for smaller firms are starting to appear. Small and medium enterprises aren't just going to source in China; they are going to sell in China, said J.P. Faber, publisher of Miami-based China Trade magazine, which targets the next wave of firms trying to break into the world's largest consumer market. From a California firm that makes high-tech briefcases to the manufacturer of prefabricated structures in the Midwest, there are U.S. companies finding a toe-hold for their products, he said.

 

Although double-digit economic growth is giving bloom to a thriving Chinese middle-class of consumers, Florida's exports to China are a trickle compared to the torrent of Chinese imports. While China sent $5.1 billion in goods to Florida's ports last year, the Sunshine State sent just $230.5 million back, according to Enterprise Florida.

 

Wolfe Metals, a Hollywood company that buys scrap metal in the United States and Latin America and sells it to Europe and Asia, is one local firm that has made inroads in China. José Gómez, the company's vice president, traveled there for the first time in 2004 with a delegation from the Broward Alliance, but it took about a year to broker a deal. They don't just jump into business and grab it like we are used to in the U.S., he explained. You have to be reassuring and really build a relationship. But patience pays off. Now China -- the world's largest consumer of scrap metal -- represents about half of Wolfe's $30 million in annual gross sales, Gómez said.

 

While China is a natural destination for raw materials and high-tech wares, there is also room for retailers who know how to tap into China's brand-conscious consumers, said Joe Chi, executive director of the China-Latin America Trade Center. His Miami-based organization is working with a cigar maker and a distributor of olive oil to crack the China market.

 

Eric Diaz-Arguelles, manager of international economic development at the Beacon Council, Miami-Dade County's economic development agency, traveled to China recently to prepare for the council's first trade mission there later this year.

 

While China is a massive market, it is by no means an easy one. It's dog eat dog -- you have to compete with international companies and Chinese companies that know their own market better than anybody, he said. But there is certainly a place for those savvy enough to compete.

 

source: Miami Herald http://www.miamiherald.com/103/story/97473.html

 

 

 

 

 

 

A Representative Office

is just a subsidiary of a foreign company in China. If your company needs a local presence to manage services or coordinate outsourcing business activities or to research the developing Chinese market, then a Representative Office is a useful and inexpensive vehicle for establishing a presence in China. Other main tasks include conducting market research, monitoring purchasing activities, marketing and administration of sales conducted between China and the parent company. Representative Offices cannot bill their clients in China for services or sales. However, it can act as liaison office in matters pertaining to ordering, shipping, collecting money and so on.

 

A Representative Office is a useful and relatively inexpensive first step to establish your business in China. But it is not a self-governing entity with all attached rights and responsibilities. Responsibility remains with the parent or offshore company. Since it only handles liaison and co-ordination work, its business scope is very limited. A Representative Office provides the opportunity to explore China as a market and to analyse its potential and viability for your business. As a low-cost introductory presence it's a perfect solution.

 

Benefits: Low set up costs. No paid up share capital is required. Easily to registered with the Chinese government. Represents the parent company. Coordinates business activities.

 

Disadvantages: Limited in its business scope, no trading or invoicing permitted. Must hire local staff via a government organization. Business licenses are usually issued for two to three years, but are renewable.

Still subject to taxation on its running costs at a rate of roughly 10%. Tax filing has to be submitted monthly. Annual audits. There are statutory audit requirements with respect to operational expenses as well as foreign currency bank accounts.

 

 

 

 

 

 

Joint Venture

 

Joint Venture is a corporate structure formed between a foreign firm and one or more local Chinese partner(s). Usually a Joint Venture is established to combine and use the market knowledge, preferential treatment, and manufacturing capability of the Chinese side with the technology, manufacturing know-how and marketing experience of the foreign partner(s).

 

For many years Joint Venture was the second most common method of investing in China, and investment regulations were heavily weighted in favour of the local Chinese partners. Most recently, the investment environment has changed significantly and most foreign investments are now in the form of Wholly Foreign Owned Enterprises (WFOEs). However, for some companies it’s still necessary or sensible to be set up as a Joint Venture

 

Benefits:

Good market access, local contacts, local knowledge. Bringing first-class workforce and facilities.

Committed to the protection of the Joint Venture Company's Intellectual Property Rights (IPR).

 

Disadvantages:

Lack of information about the prospective Chinese partner. Need to retain comprehensive control.

Sharing the profits of the business.

 

 

 

 

Wholly Foreign Owned Enterprise (WFOE)

 

These are 100% foreign owned companies, originally introduced to encourage foreign investment exclusively in the export-orientated manufacturing industry of Special Economic Zones (SEZs) in China. First they were prohibited from selling their products to the Chinese domestic market. Since a change in regulations WFOEs can trade and sell their goods within China. The capital requirements for such companies have also been dramatically reduced.

 

Benefits: 100% foreign ownership means total independence from a Chinese partner, complete control over the business and its direction. Full trading rights within China, including retailing or wholesaling wholly foreign manufactured goods. RMB profits can be converted into USD and remitted to the foreign parent. Intellectual Property Rights are protected. Greater efficiency in operations and management.

 

Disadvantages:

A foreigner with no China experience may lack the knowledge and contacts a partner would bring. In order to be successful strong relationships with the local authorities where the enterprise is located as well as along the supply chain are essential, and the cultural and administrative difficulties experienced may be quite significant.

 

What's involved in setting up a WFOE? To be honest, it’s a really laborious procedure that can take up to six months, many meetings and a mountain of paperwork. If you can't face all that form filling and bureaucracy we will be happy to help with any or every aspect:

 

Selecting a location that best suits your needs and offers the best tax incentives.

Finding the right premises.

Introducing you to the local authorities.

Preparing preliminary application.

Advising on business name regulations.

Preparing your business plan.

Preparing project proposals.

Preparing feasibility study.

Preparing formal applications.

Establishing management, production, financial, HR and sales structures.

 

 

Some curios observations:

 

I asked one Chinese why there were no slums, or Latin-American style ghettos in Shanghai. I had expected to see many poor people that were attracted to the wealth of the city, but in Shanghai and Beijing, it was rare to see any poor people in the streets, or in nearby ghettos. Even when driving out of the city to the manufacturing areas of town, it was extremely rare to find any of the expected poor slums that should be surrounding such a rich city in the middle of a developing country. My Chinese friend explained it to me that the Chinese would consider it to be essential to “save face”, and that these cities are how the outside world views China. If they were to allow such a disgrace as to have slums in or around their cities, then they would lose face to the world.

 

But this still didn’t exactly explain how the Chinese government was able to keep the mass of poor people from flooding such a rich city. I thought that if cities such as Buenos Aires or Sao Paulo were to try something like this, they could remove the poor people one day, but they would be back the next. It would take a full army of full time people movers to keep those cities empty of poor people. So, how was it that the Chinese were able to do it seemingly so easily? The answer came to me during a conversation with another Chinese friend. He explained that the Chinese just did what they were told to do, that they were very accustomed to taking orders, and in fact expected to be told what to do, where to live. Up until very recently, there was literally no free movement of people in China. If you lived in one city, you were not allowed to migrate to another for work. While this has changed in recent years, there are still major controls in place. If you come from the countryside and want to move to Shanghai, you need to have documents in order to move to the city. These documents show that you have work permit, but you will have to return to the country side once your permit is expended. I'm just guessing, but I imagine that it must be very difficult to find a place to live without the proper paperwork that shows that you are a city resident.

 

 

 

 

 

China as an export base

 

Florida companies perspective:

 

Lexis Nogueras' American Dream is being built in a Chinese factory. When the 35-year-old Cutler Ridge resident quit his job last year to launch Ergo-Tools, a line of lightweight, ergonomically-designed garden tools aimed at seniors with a green thumb, he hoped to have them made in the United States. Then came the estimates: It would cost more than $10,000 just to create the prototype for his G-Rake -- a tool forged from a plastic-nylon composite he hoped to sell for $24.99. "I couldn't afford it," said Nogueras, who works from home and is financing Ergo-Tools out of his own pocket. "It's unfortunate, but I was forced to look elsewhere.". Where he eventually looked was to a Chinese manufacturer. Three weeks after e-mailing his design to the company, Nogueras received a FedEx package containing the finished G-Rake prototype and a bill for about $850.

 

There's nothing new about outsourcing to China, but the growing ease of communication, the expanding legion of English-speaking professionals and a thriving business environment are making it easier than ever for small ventures to tread in an arena once reserved for large corporations.

 

"Twenty years ago it was only the biggest companies that were going to China, 10 years ago it was middle-sized companies, and now everyone is going to China," said Howard Ullman, chairman of China Direct Trading ( http://www.chdt.us ), a Cooper City company that imports Asian goods and helps local companies navigate the Chinese economy. It's hard to quantify the number of local small businesses that have a China strategy, but the Jay Malina International Trade Consortium ( http://www.miamidade.gov/itc ) , Miami-Dade County's international trade agency, says it has 1,336 Miami-area companies on file that either import or export to China.

 

What is far more clear is China's overall economic impact here. Over the last four years China has surpassed Brazil and Germany to become the state's second-largest source of imports. At the Port of Miami, where China was the 30th largest client five years ago, it is now No. 1, sending 832,886 tons worth of products in 2006. At Port Everglades, China is the second-largest client, sending 342,642 tons of products. Not all these Chinese goods stay in Florida, however. Many are trans-shipped to Latin America, the Caribbean and other U.S. destinations.

 

While apparel, machinery and industrial equipment top China's list of exports to the state, the range of goods arriving at South Florida ports offers a snapshot of local consumer habits. China Direct, for example, started off importing refrigerator magnets, key chains and other souvenirs. Now it is bringing in hardware, automotive parts and -- in preparation for hurricane season -- electrical generators and ceramic roofing tiles.

 

Hart Baur is co-owner of Nicamaka ( http://www.nicamaka.com/ )-- a Miami firm that got its start in the early 1990s importing hand-woven hammocks and other Central American handicrafts. Late last year he bought a ticket to China to find factories where Nicamaka might make branded goods, such as mosquito nets, umbrellas and corporate tents. What he found were manufacturers willing to churn out prototypes and designs at cut-rate prices in hopes of winning his business. They have a much longer-term vision there, Baur said. The attitude is if I do this right and make the client happy, we'll be in business for the next 20 years. Shortly after the trip he sent one of his new contacts a sketch of a four-point bed canopy made with blackout material. Nineteen days later he had the finished product in his hands, complete with the Nicamaka logo. Because he had an established relationship with the factory, the prototype was free. Before China, coming up with new products had been prohibitively expensive for Nicamaka, said Baur. I can be almost unlimitedly creative in my head now, he said. And I'm curious and excited about all the things we might come up with over the next 10 years. Chinese-made goods represented only about 20 percent of Nicamaka's sales two years ago, he said. Now they account for about 80 percent.

 

It's not just the prices that have smaller firms looking toward China; it's also the flexibility, said Christina Bracken, the head of business development and creative services at CFT True Source, a Miami company that helps U.S. ventures identify Chinese manufacturers. Phone Interview: http://www.miamiherald.com/103/story/97471-a96406-t4.html

 

Some of her smallest clients have approached her only after finding U.S. factories had minimum production requirements that were beyond their reach. In China if someone is interested enough in your business, they will make it happen, she said. It's very pioneerish that way . . . It's the Wild West of business. But like the Wild West, China's manufacturing industry has its share of stray bullets and unsavory characters. The nation is the world's leading producer of counterfeit goods, and human rights groups have warned of abysmal labor conditions in some Chinese factories.

 

It is easy to start business with China because there is an atmosphere of free flowing entrepreneurship, said Joe Chi, executive director of Miami's China-Latin America Trade Center ( http://www.chinalatam.com/ ) , which opened six months ago. At the same time you have the underside -- where unfettered capitalism engenders some bad characters that come out and take advantage of the situation. Tales abound of unscrupulous factory owners that run off with money, sell patented products to competitors, or simply promise one quality and deliver another, he said. Because of the competitive situation and rising material costs, a lot of manufacturers are trying to cut corners,'' said Chi. And the next corner they cut might be yours. Those problems have been exacerbated by the Internet, which has made it far easier to find a factory but also easier for scammers to prey on the unsuspecting. There is no lack of information on the Internet about who might be able to make a product for you, but there is a lack of information about who you can trust, said Bracken.

 

Organizations such as China Direct, the China-Latin America Trade Center and CFT rely on a network of personal relationships and referrals to help their clients steer clear of fraudsters.

 

But small businesses have other routes too. The Broward Alliance has led two trade delegations to China and Miami-Dade's Beacon Council plans to take business representatives there later this year. There are also trade fairs aimed at small businesses, said Chi.

 

Opportunities to meet factory owners first-hand are critical in China, where relationships are paramount, said John Diep, director of the Asia Pacific Region for Enterprise Florida, the state development agency, which has a trade office in Beijing. http://www.eflorida.com/globaladvantages/exporting.asp?level1=25&level2=122

 

You cannot do business with China one time, he said. They need to hear from you and see you every so often and measure your level of commitment. . . . The Internet might facilitate the first contact but it is always recommended to meet face-to-face to know more about your potential partner before you start business. The emphasis on personal relationships is just one of the cultural quirks that takes getting used to.

 

Margarita Gonzales first traveled to China from Miami in 1989 to find a manufacturer of machines to count bills and detect counterfeit money. At first her Chinese counterparts were reluctant to talk to her and kept asking to speak to her business partner and husband. Finally she had to explain that she was the president and CFO of AccuBANKER. I'm the one who authorizes the payments so if you want to do business with me, you will have to do business with me, she recalls saying. While working in China can still be quite challenging for women, attitudes are changing almost as fast as the Beijing skyline. I go to China twice a year and every time it's a new China, she said.

 

Ergo-Tools' Nogueras said he hopes to see China and meet his business partners for the first time soon. But for now he is focusing his time and money on getting Ergo-Tools off the ground. Next month he hopes to place his first order for about 4,000 tools -- an order that will essentially wipe out his life savings.

 

But starting a business is a lot like working with China, he said; it requires a sense of adventure and a high tolerance for risk. It has been a leap of faith, said Nogueras, but so far, it has been smooth sailing.

 

source: http://www.miamiherald.com/103/story/97471.html

 

 

Beyond Cheap Labor:

 

Macroeconomic interrelations shift periodically, and a competitive advantage in one location may become a disadvantage over time. This could happen if there are changes in exchange rates, if there are local inflationary pressures, if there are raw material shortages, or if there are changes in government policies. When a country develops, it will lose comparative advantage in wages, and needs to move up the value chain (as was described in “Beyond Cheap Labor”). There is a direct relationship between GDP per person and wages per hour, so even China will someday loose its comparative advantage as the worlds cheap labor market as its GDP per person rises over time. A country need to manage the transition from competing on low cost labor to more value added products and services. It was interesting that the book “Driving Growth” placed such high value on a country’s ability to develop a competitive local service market as a means for improving the standard of living. This focus on developing the market for local services is essential for unlocking productivity growth that will drive competitive advantage in many other areas.

 

 

 

Trade Show Events

 

Furniture

 

 

Shenzhen, China

SIFE (Shenzhen International Furniture Exposition)

August 19th -22th, 2007

http://www.chinafurnitureexpo.com/en/index.asp

Shenzhen International Furniture Expo (SIFE) has been a great success since 1996, with the exhibition venue developed from 8,000m2 Shenzhen International Exhibition Center to 42,000m2 China Hi-tech Fair Exhibition Center (Shenzhen), and was finally settled in the 160,000m2 Shenzhen Convention & Exhibition Center. SIFE opens twice a year and each lasts 4 days. The accumulative total quantity of visitors is about 1.6 million. The total of transaction volume has reached RMB27.6 billion, of which export orders have added up to USD1.5 billion. By virtue of these facts SIFE has distinguished itself one of the most influential furniture fairs in Asia

 

 

China International Furniture Expo

September 12-15, 2007

Shanghai - 1,600 exhibitors, 240,000 sqm

http://www.furniture-china.cn/

Event Profile: Furniture China 2006 is gearing up for business. Furniture professionals have bookmarked Furniture China in Shanghai, September 11-14, 2006 as the main event in Asia to source quality furniture. Furniture China 2006 presents itself on two main venues, the Venue West (Intex, Shanghai Mart & Jisheng Wellborn Hongqiao) solely dedicated to Home Furniture and the Venue East (Shanghai New Expo Center, SNIEC) display for home furniture, office furniture, furnishings, and furniture manufacturing.

Visitor's Profile: Architects, Interior Designers / Decorators, Wholesalers, Distributors, Furniture Manufacturers, Importers, Exporters of Furniture, Retailers, Agents, Representatives & General Public are the target visitors.

 

 

 

 

 

 

 

Other Products

List of all trade fairs in China: http://www.aboutchinafair.com/

 

Chinese Import and Export Commodities Fair(Canton Fair)

April.15th-30th (Spring Fair)

Oct.15th-30th (Autumn Fair)

http://www.cantonfair.org.cn

 

China (Shouguang) International Vegetable Sci-tech Fair

April 20-May20

Shouguang, Shandong

http://www.intvegetable-fair.com/English

 

The Expo Central China

May 18th-20th

Zhengzhou International Convention and Exhibition Centre, in Henan Province

http://expocentralchina.mofcom.gov.cn/pub/zbblh/EnglishHome/default.htm

 

China International Consumer Goods Fair

Jun 08, 2007--Jun 12, 2007

Ningbo

http://www.cicgf.com/

 

The 3rd China International Tunnel & Underground Space Exhibition & Conference

Jun 12, 2007--Jun 14, 2007

Shanghai

http://www.tunnel-china.com

 

GIMT+AMB China 2007

Jun 15, 2007--Jun 18, 2007

Guangzhou

http://www.gimt.com.cn/

 

Brew Drinks China 2007

Aug 16, 2007--Aug 18, 2007

Qingdao

http://www.bdcqd.com

 

The International Exhibition on Water & Wastewater Treatment Systems and Technology

Jul 11, 2007--Jul 14, 2007

Shanghai

http://www.watertech-china.com

 

China International Fair for Investment and Trade (CIFIT)

September 8-11

Xiamen

http://www.chinafair.org.cn

 

China (Taiyuan) International Coal & Energy New Industry Expo. (CICEN EXPO)

September 16-18

Taiyuan , Shanxin

http://www.cicenfair.com/

 

China Hi-Tech Fair (CHTF)

October 12-17

Shenzhen

http://www.chtf.com/english

 

China Yiwu International Commodities Fair

October 22-26

Yiwu, Zheijiang

http://www.chinafairs.org

 

 

 

Media

Wall Street Journal Asia: Daily business newspaper from The Wall Street Journal focusing on Asia and the Pacific Rim. Comprehensive coverage of Asian stock markets, companies, politics, and other major news. Formerly known as The Asian Wall Street Journal. Country of origin: Hong Kong

http://www.wsj-asia.com/

 

South China Morning Post: An English newspaper comprised of general news and business reporting. As the leading regional newspaper, particular emphasis is placed on Hong Kong and the special economic zones in the People's Republic of China. Country of origin: Hong Kong

http://www.scmp.com

 

Economist Magazine - China Guide

http://www.economist.com/countries/China/

 

 

 

 

 

China.org.cn

http://www.china.org.cn/english/index.htm

 

China Daily

http://www.chinadaily.com.cn/english/home/index.html

 

China News

http://www.chinanews.cn/

 

China News http://www.einnews.com/china/

 

People's Daily

http://english.people.com.cn/

 

Shanghai Daily

http://www.shanghaidaily.com/

 

English.Eastday

http://english.eastday.com/

 

South China Morning Post

http://www.scmp.com/

 

XinHua

http://www.xinhuanet.com/english/

 

China Radio Internacional

http://en.chinabroadcast.cn/

 

Shanghai Daily

http://www.shanghaidaily.com

 

News Guangdong

http://www.newsgd.com/

 

Hong Kong Standard

http://www.thestandard.com.hk

 

China Economic Review

www.ChinaEconomicReview.com

 

China Business

www.cib-online.cn

 

China Today

www.chinatoday.com.cn

 

 

 

CURRENCY:

The unit of Chinese currency is the Yuan (RMB).

http://www.chinatoday.com/fin/mon/

 

What is the current exchange rate?

Go to: http://www.x-rates.com/calculator.html#

 

 

 

Export

If you are looking for producers of goods to export out of china:

Worldwide Outsourcing Directory

 

 

 

 

 

 

International Property Rights (IPRs)

 

 

 

 

How Chinese view the rest of the world

 

Although it is difficult to get the Chinese to say anything directly negative about anyone, it is possible to tell indirectly what they think. It is clear that most Chinese think very little of the North Koreans, or of their leader Kim. While there, I heard quite a few negative comments about the place. The common response is that N Korea is very poor, and “like China was 50 years ago”. From a friend, I learned that the Chinese media typically paints the Koreans, Japanese and US Americans in a very negative light. His opinion was that the government propagates hate against these three groups. I'm not sure exactly why.

 

Very similar to the US, most Chinese people have spent very little time traveling for pleasure abroad. I found that the Chinese were very knowledgeable of other places and of other people in the world. When I told them that I was born in Canada, most of the people that I met on the street knew 3 or 4 of the major cities in Canada (which might be more than most Americans can name). I found Chinese that could speak English in most places that I went, and even some that could speak Spanish, German, French and Portuguese. But then, I found it interesting that most of the Chinese people that I met had never actually been outside of China itself. In fact, I discovered that it is extremely difficult and expensive for most Chinese people to travel abroad. It can take up to a year and a half for them to get the necessary authorization (travel visa) to leave the country. I told my new Chinese friends that it only took me a week to get my visa to come to China and a $100 usd, and they were amazed. The Chinese that I met that had traveled abroad were either from Hong Kong, Taiwan, or else they were traveling abroad on a business visa. On the airplane leaving shanghai for the US, I saw mostly US citizens, most of whom looked Chinese, but many of which didn’t speak the language. Of the Chinese that I met on the plane, many of them were making their first trip abroad (mainly to set up sales operations for manufactured goods in the US).

 

When talking about India, its very popular with the Chinese if you were to criticize the Indians for their “inability to make decisions” on the state level. Whether its true or not, the Chinese people have a strong belief the democracy in India is what keeps them from being able to organize public works projects, such as road construction, or necessary infrastructure projects. On Chinese joked with me that the Indians will stop a road construction because one tree is “holy”. There seems to be the belief in China that central planning of the government is extremely beneficial to them all, and that the confusion of a voting democracy would just slow them down. This may not be the true feelings of all Chinese, but it seems to represent the views expressed by most that I met on the trip.

 

I'm not sure what the beaches are like in China, but most Chinese that I met in Shanghai told me that they had never been to the beach, and many told me that they had never seen the ocean. When I spoke about surfing, the people I met looked at me blankly like I was from another planet. Unlike Brazil, I don’t believe that Chinese people have a beach culture. Maybe they are too busy working?

 

 

 

 

Arranging meetings in China

 

• The East Asia & Pacific office of the U.S. Department of Commerce can help you in arranging appointments with local Chinese business and government officials, and can identify the contacts you will have to establish to achieve your objectives. The services of a host of a reputable Public Relations firm is recommended for detailed work involving meeting and negotiating with senior Chinese officials or even pinpointing whom you should meet for your purposes.
• The best times for scheduling appointments are April to June and September to October.
• Business and government hours are 8:00 a.m. to 5:00 p.m., Monday through Saturday. There is, however, a five-day work week in larger cities. Do avoid plans to visit government offices on Friday afternoon, because this is sometimes reserved for 'political studying' of the officials.
• Store hours are 9:00 a.m. to 7:00 p.m., daily. Most stores in Shanghai, however, remain open until 10:00 p.m.
• Most Chinese workers take a break between 12:00 p.m.- 2:00 p.m. Practically everything "shuts down" during this period, including elevator and phone services.
• When scheduling your appointments, be sensitive to holidays such as Chinese New Year. During May Day, or the National Day, many businesses will be closed for up to a week during this period. The date of this occasion varies from year to year due to an official advisory to allow the long holidays.

 

 

Business Etiquette

 

Meetings

 

• Greetings are formal and the oldest person is always greeted first.
• Handshakes are the most common form of greeting with foreigners.
• Many Chinese will look towards the ground when greeting someone.
• Address the person by an honorific title and their surname. If they want to move to a first-name basis, they will advise you which name to use.
• Being late for an appointment is considered a serious insult in Chinese business culture.
• Appointments are necessary and, if possible, should be made between one-to-two months in advance, preferably in writing.
• If you do not have a contact within the company, use an intermediary to arrange a formal introduction. Once the introduction has been made, you should provide the company with information about your company and what you want to accomplish at the meeting.
• Pay great attention to the agenda as each Chinese participant has his or her own agenda that they will attempt to introduce.
• Send an agenda before the meeting so your Chinese colleagues have the chance to meet with any technical experts prior to the meeting. Discuss the agenda with your translator/intermediary prior to submission.
• Each participant will take an opportunity to dominate the floor for lengthy periods without appearing to say very much of anything that actually contributes to the meeting. Be patient and listen. There could be subtle messages being transmitted that would assist you in allaying fears of on-going association.
• Meetings require patience. Mobile phones ring frequently and conversations tend to be boisterous. Never ask the Chinese to turn off their mobile phones as this causes you both to lose face.
• Guests are generally escorted to their seats, which are in descending order of rank. Senior people generally sit opposite senior people from the other side.
• It is imperative that you bring your own interpreter, especially if you plan to discuss legal or extremely technical concepts as you can brief the interpreter prior to the meeting.
• Written material should be available in both English and Chinese, using simplified characters. Be very careful about what is written. Make absolutely certain that written translations are accurate and cannot be misinterpreted.
• Visual aids are useful in large meetings and should only be done with black type on white background. Colors have special meanings and if you are not careful, your color choice could work against you.
• Presentations should be detailed and factual and focus on long-term benefits. Be prepared for the presentation to be a challenge.

 

 

 

Business Cards

 

• Business cards are exchanged after the initial introduction.
• Have one side of your business card translated into Chinese using simplified Chinese characters that are printed in gold ink since gold is an auspicious colour.
• Your business card should include your title. If your company is the oldest or largest in your country, that fact should be on your card as well.
• Hold the card in both hands when offering it, Chinese side facing the recipient.
• Examine a business card before putting it on the table next to you or in a business card case.
• Never write on someone's card unless so directed.
• The Chinese are very keen about exchanging business cards, so be sure to bring a plentiful supply. Ensure that one side is in English and the other is in Chinese, preferably in the local dialect.
• Include your professional title on your business card, especially if you have the seniority to make decisions. In Chinese business culture, the main point of exchanging business cards is to determine who will be the key decision-makers on your side.
• If your company is the oldest or largest in your country, or has another prestigious distinction, ensure that this is stated on your card.
• It's an asset to have your business cards printed in gold ink. In Chinese business culture, gold is the colour of prestige, prosperity
• Present your card with two hands, and ensure that the Chinese side is facing the recipient.
• When receiving a business card, make a show of examining it carefully for a few moments; then, carefully place it into your card case or on the table, if you are seated at one.
• Not reading a business card that has been presented to you, then stuffing it directly into your back pocket, will be a breach of protocol.

 

 

 

 

 

 

 

Business negotiation

 

• Only senior members of the negotiating team will speak. Designate the most senior person in your group as your spokesman for the introductory functions.
• Business negotiations occur at a slow pace.
• Be prepared for the agenda to become a jumping off point for other discussions.
• Chinese are non-confrontational. They will not overtly say 'no', they will say 'they will think about it' or 'they will see'.
• Chinese negotiations are process oriented. They want to determine if relationships can develop to a stage where both parties are comfortable doing business with the other.
• Decisions may take a long time, as they require careful review and consideration.
• Under no circumstances should you lose your temper or you will lose face and irrevocably damage your relationship.
• Do not use high-pressure tactics. You might find yourself outmanoeuvred.
• Business is hierarchical. Decisions are unlikely to be made during the meetings you attend.
• Your starting price should leave room for negotiation.
• You will have to make presentations to different levels of the organization.
• Before you arrive, have at least 20 copies of your proposal ready for distribution.
• Printed presentation materials of any kind should be only in black and white. Avoid colours that are attributed special meanings in this culture, many of them negative.
• Except for those educated in the West, Chinese businesspeople largely rely on subjective feelings and personal experiences in forming opinions and solving problems.
• Belief in the Communist party line will be a dominant influence in all negotiations.
• Empirical evidence and other objective facts will be accepted only if they do not contradict Communist party doctrine and one's feelings.

*Local decisions are made by the head of the collective.

• In Chinese business culture, the collectivist way of thinking still prevails, even in sectors experimenting with free enterprise.
• “Saving face” is an important concept to understand. In Chinese business culture, a person's reputation and social standing rests on this concept. Causing embarrassment or loss of composure, even unintentionally, can be disastrous for business negotiations.
• In accordance with Chinese business protocol, people are expected to enter the meeting room in hierarchical order. For example, the Chinese will assume that the first foreigner to enter the room is head of the delegation.
• Since there is such a strong emphasis on hierarchy in Chinese business culture, ensure that you bring a senior member of your organization to lead the negotiations on your behalf. The Chinese will do the same.
• Only the senior members of your group are expected to lead the discussion. Interruptions of any kind from subordinates are considered shocking by the Chinese.
• In Chinese business culture, humility is a virtue. Exaggerated claims are regarded with suspicion and, in most instances, will be investigated.
• The Chinese will not directly say “no” to you. Instead, ambivalent answers such as “perhaps”, “I'm not sure”, “I'll think about it”, or “We'll see” usually mean “no.”
• The Chinese tend to extend negotiations well beyond the official deadline to gain advantage. On the final day of your visit, they even may try to renegotiate everything.
• Be patient, show little emotion, and calmly accept that delays will occur.
• Moreover, do not mention deadlines.
• At the end of a meeting, you are expected to leave before your Chinese counterparts.
• You may have to make several trips to China to achieve your objectives. Chinese businesspeople prefer to establish a strong relationship before closing a deal.
• Even after the contract is signed, the Chinese will often continue to press for a better deal.

 

 

 

 

Business Relationship

 

• The Chinese don't like doing business with companies they don't know, so working through an intermediary is crucial. This could be an individual or an organization who can make a formal introduction and vouch for the reliability of your company.
• Before arriving in China send materials (written in Chinese) that describe your company, its history, and literature about your products and services. The Chinese often use intermediaries to ask questions that they would prefer not to make directly.
• Business relationships are built formally after the Chinese get to know you.
• Be very patient. It takes a considerable amount of time and is bound up with enormous bureaucracy.
• The Chinese see foreigners as representatives of their company rather than as individuals.
• Rank is extremely important in business relationships and you must keep rank differences in mind when communicating.
• Gender bias is nonexistent in business.
• Never lose sight of the fact that communication is official, especially in dealing with someone of higher rank. Treating them too informally, especially in front of their peers, may well ruin a potential deal.
• The Chinese prefer face-to-face meetings rather than written or telephonic communication.
• Meals and social events are not the place for business discussions. There is a demarcation between business and socializing in China, so try to be careful not to intertwine the two.

 

 

 

 

Entertaining

 

 

 

 

• The Chinese prefer to entertain in public places rather than in their homes, especially when entertaining foreigners.
• If you are invited to their house, consider it a great honor. If you must turn down such an honor, it is considered polite to explain the conflict in your schedule so that your actions are not taken as a slight.
• Arrive on time.
• Remove your shoes before entering the house.
• Bring a small gift to the hostess.
• Eat well to demonstrate that you are enjoying the food!
• Learn to use chopsticks.
• Wait to be told where to sit. The guest of honour will be given a seat facing the door.
• The host begins eating first.
• You should try everything that is offered to you.
• Never eat the last piece from the serving tray.
• Be observant to other peoples' needs.
• Chopsticks should be returned to the chopstick rest after every few bites and when you drink or stop to speak.
• The host offers the first toast.
• Do not put bones in your bowl. Place them on the table or in a special bowl for that purpose.
• Hold the rice bowl close to your mouth while eating.
• Do not be offended if a Chinese person makes slurping or belching sounds; it merely indicates that they are enjoying their food.
• There are no strict rules about finishing all the food in your bowl.
• Wait to be seated, as there is a seating etiquette based on hierarchy in Chinese business culture.
• Generally, the seat in the middle of the table, facing the door, is reserved for the host. The most senior guest of honour sits directly to the left. Everyone else is seated in descending order of status. The most senior member sits in the center seat. Follow this seating pattern if you are hosting a banquet or a meal in your residence, whether for business or purely social reasons.
• The host is the first person at the table allowed to begin eating by declaring the first toast. Then, the rest of the company can proceed with the meal. If you are the host, take the first piece of the most valued food and put it on your guest of honour's plate after the first toast. This will signify that eating can proceed and is considered a friendly gesture.
• It is not uncommon for a host to order enough food for ten people at a table of five. He or she loses face if there are not plenty of left-overs at the end of a meal. Rice, considered by many Chinese to be filler, is generally not served until the end of a meal. So, if you want to eat rice with your meal be sure to ask the waitress or 'shou jie' to serve it early, particularly if the food is spicy.
• During a meal, as many as 20-30 courses can be served, so try not to eat too much at once. The best policy is to lightly sample each dish.
• Leaving a 'clean plate' is perceived to mean that you were not given enough food--a terrible insult here. On the other hand, leaving a food offering untouched will also give offense; even if you find a dish unappealing, try a small portion for the sake of politeness.
• One important part of Chinese business entertaining is a tea drinking ritual known as 'yum cha.' It is used to establish rapport before a meeting or during meals.
• If you do not want a 'refill' of tea, leave some in your cup.
• If you are served food that does not require utensils, you may be given a bowl of tea for the purpose of dipping and cleaning your fingers.
• It's perfectly acceptable to reach in front of others for dishes and other items.
• Seeds and bones are placed on the table or in a specially reserved dish; never place these objects in your bowl.
• It will be appreciated if you use chopsticks. When you are finished eating, place your chopsticks on the table or a chopstick rest.

*Placing your chopsticks parallel on top of your bowl is believed to bring bad luck.

• Sticking your chopsticks straight up in your rice bowl is considered rude because in this position, they resemble the joss sticks that are used in Chinese religious rituals.
• Do not put the end of the chopstick in your mouth.
• Try not to drop your chopsticks, as this is considered a sign of bad luck.
• When eating rice, follow Chinese custom by holding the bowl close to your mouth.
• Slurping and belching at the table can be perfectly acceptable: they are perceived as signs that you are appreciating the meal.
• Scorpions, locusts, snake skin, bile, dog meat, soft-shell tortoise and blood are considered delicacies.
• Toothpicks are usually offered between courses and at the conclusion of a meal. When using a toothpick, cover your mouth with your free hand for concealment.
• During a meal, do not turn a fish over to get to the flesh on the underside. Superstition holds that turning a fish over will cause a fishing boat to capsize.

 

 

 

Follow up

• The meal has reached a definite conclusion when fruit is served and hot towels are presented. Shortly after these items are offered, guests should make preparations to leave. In accordance with Chinese business etiquette, the host will not initiate the guests' departure.
• Follow Chinese business protocol and reciprocate with a banquet of the same value; never surpass your host by arranging a more lavish gathering.
• Generally, the Chinese are not great experimenters when it comes to their diet. Unless he or she has traveled extensively, the typical Chinese businessperson doesn't like Western food. Better to take your guests to a good Chinese restaurant rather than, for example, the latest French restaurant opening in Beijing. They'll appreciate it.
• If you are hosting a banquet, you should arrive at least 30 minutes before your guests.
• When inviting people to your home, avoid serving cheese: it is usually incompatible with the national diet.

 

 

Drinking Alcohol

• Forming a personal relationship ('guanxi' in Chinese) in your business dealings is very important. Part of this involves participating in the strong drinking culture that exists here. Generally, the Chinese regard with suspicion anyone who does not participate in the inevitable drinking that takes place during almost all business dinners. And it is at these kinds of social occasions that most negotiating breakthroughs are made. Prepare some medical excuses for yourself to avoid drinking heavily; if you really wish to avoid alcohol, your companions will accept medical excuses.
• Toasting, usually with beer, wine or Chinese white liquors, is an important part of Chinese business etiquette.
• You will often find three glasses on your table: a glass for your drink of choice (toast with this glass), a wine glass, and a shot glass for a liquor called 'maotai' or 'wu liang ye.'
• The host of a banquet offers the first toast. If you prefer not to drink alcohol, it's perfectly acceptable to toast with a soft drink, glass of juice, or mineral water.
• Toasts will be proposed throughout the meal. Two popular toasts are 'ganbei' ('bottoms up!') and 'kai wei' ('starting the appetite!').
• Sometimes, the Chinese enjoy testing the ability of a foreigner ('lou wai') to handle his or her alcohol, especially 'er gua toe', a potent clear alcohol that one might compare to airline fuel. A good practice would be to eat something beforehand.
• Drinking a lot (and even drunkenness) may earn you respect or trust, since many Chinese believe that alcohol causes barriers to come down and true intentions to be revealed.

 

 

 

 

Smoking

• Before smoking, it's polite to offer cigarettes to those in your company.

 

 

 

 

 

Tipping Etiquette:

• Tipping is generally considered an insult in China.
• Most government operated hotels and restaurants prohibit acceptance of tips.
• It is sometimes expected, however, in some of the bigger hotels and by younger service personnel, in the more open cities.
• Tipping is becoming more commonplace, especially with younger workers although older workers still consider it an insult. Leaving a few coins is usually sufficient.

 

 

 

Acceptable Public Behaviors

 

• The Chinese will sometimes nod as an initial greeting. Bowing is seldom used except in ceremonies. Handshakes are also popular; wait, however, for your Chinese counterpart to initiate the gesture.
• If you visit a school, theater, or other workplace, it is likely that you will be greeted with applause as a sign of welcome. In turn, you should respond by applauding back.
• Avoid making expansive gestures and using unusual facial expressions.
• The Chinese do not use their hands when speaking, and will only become annoyed with a speaker who does.
• Some hand gestures, however, are necessary. They are outlined in the next two points.
• To summon attention, turn your palm down, waving your fingers toward yourself.
• Use your whole hand rather than your index finger to point.
• The Chinese, especially those who are older and in positions of authority, dislike being touched by strangers.
• Acknowledge the most senior person in a group first.
• Smiling is not as noticeable in China, since there is a heavy emphasis on repressing emotion.
• You may see members of the same sex may holding hands in public in order to show friendliness not sexuality.
• Public displays of affection between the sexes are frowned upon.
• Do not put your hands in your mouth, as it is considered vulgar. Consequently, when in public, avoid biting your nails, removing food from your teeth, and similar practices.
• Pushing and cutting ahead is common in lineups among Chinese, but they do not appreciate being cut in front of themselves.
• Spitting in public is no longer acceptable. It is subject to a heavy fine now.
• Blowing your nose with a handkerchief is also acceptable, but it is advisable to turn away from people while doing so.

 

 

 

 

 

How to dress for Business in China

• In Chinese business culture, conservative suits and ties in subdued colors are the norm. Bright colors of any kind are considered inappropriate.
• Women should wear conservative suits or dresses; a blouse or other kind of top should have a high neckline. Stick with subdued, neutral, colors such as beige and brown.
• Because of the emphasis on conservative, modest, dress in Chinese business culture, flat shoes or very low heels are the main footwear options for women. This is true especially if you are relatively much taller than your hosts. High heels are acceptable only at a formal reception hosted by a foreign diplomat.
• Men should wear suits and ties to formal events; tuxedoes are not a part of Chinese business culture.
• Jeans are acceptable casual wear for both men and women.
• Shorts are reserved for exercise.
• Men should wear dark coloured, conservative business suits.

 

Addressing others with respect

 

Chinese names appear in a different order than Western names. Each person has, in this order, a family, generational, and first name. Generational and given names can be separated by a space or a hyphen, but are frequently written as one word. The generational designation is usually the first word of a two-worded first name. This is still popular in some families, especially among the southerners and the overseas Chinese from the south. Most modern Chinese first names are single worded. The first names of those born during the cultural revolution era usually carries political meaning showing support toward Chairman Mao and his wife, Jiang Qing.

 

 

Most people should be addressed with a title and their last name. If a person does not have a professional title, use “Mr.”, “Madam”, “Miss”, plus the last name.

 

 

A married Chinese woman usually retains her maiden name; she will use her husband's last name on occasions for formal addressing only.

 

 

Many Chinese adopt an English first name to make it easier for North Americans and other Westerners to address them. You can expect to hear some rather odd and rare English names as they try hard to be different from others.

 

 

Address people using official titles such as “General” “Committee Member”, or “Bureau Chief” whenever possible. It is customary to address the deputies by skipping the word 'deputy,' such as, 'Chief' for 'Deputy Chief,' 'Chairman' for 'Vice Chairman' 'General Manager' for 'Assistant General Manager.'

 

 

Unless you're a Communist, never refer to someone as “Comrade.”

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Making conversation in China

 

 

Before your visit, it will be a good idea to prepare yourself by studying aspects of Chinese culture, history, and geography. Your hosts will appreciate your initiative.

 

You may be asked intrusive questions concerning your age, income, and marital status. If you don't want to reveal this information, remain polite and give an unspecific answer. Don't express irritation with the questioner, since 'losing face' has such negative implications in this culture. On the other hand, unless you are a very familiar personal friend, do not ask your Chinese hosts about their family although, typically, you can ask 'How old is your child?', 'How long have you been in the work force?' or 'Where is your child studying?' as a means of determining their marital status and age.

 

In Chinese culture, the question 'Have you eaten?' or or 'Where have you been?' is the equivalent to 'How are you?' in North America; it's just a superficial inquiry that does not require a literal-minded, detailed answer. Simply answer, 'yes', even if you haven't actually eaten or simply smile and say 'thank you.'

 

During a meal, expressing enthusiasm about the food you are eating is a welcome, and usually expected, topic of conversation.

 

There is no need to avoid mentioning Taiwan. If the subject comes up, never refer to this island as 'The Republic of China' or 'Nationalist China.' The correct term is 'Taiwan Province', or just 'Taiwan.'

 

 

'Small talk' is considered especially important at the beginning of a meeting; any of the topics suggested in the next set of points will be appropriate for this occasion.

 

 

 

 

Welcome Topics of Conversation

Chinese scenery, landmarks

 

 

weather, climate, and geography in China

 

 

 

your travels in other countries

 

 

your positive experiences traveling in China

 

 

Chinese art

 

 

 

 

 

Topics to Avoid

 

 

Refrain from using the terms such as 'Red China', 'Mainland China,' and 'Communist China.' Just say 'China.'

 

 

 

 

 

 

Confucianism

 

Confucianism is a system of behaviours and ethics that stress the obligations of people towards one another based upon their relationship. The basic tenets are based upon five different relationships:

 

• Ruler and subject

• Husband and wife

• Parents and children

• Brothers and sisters

• Friend and friend

 

Confucianism stresses duty, sincerity, loyalty, honour, filial piety, respect for age and seniority. Through maintaing harmonious relations as individuals, society itself becomes stable.

 

 

 

 

 

 

 

 

 

 

Non-Verbal Communication

 

• The Chinese’ Non-verbal communication speaks volumes.

• Since the Chinese strive for harmony and are group dependent, they rely on facial expression, tone of voice and posture to tell them what someone feels.

• Frowning while someone is speaking is interpreted as a sign of disagreement. Therefore, most Chinese maintain an impassive expression when speaking.

• It is considered disrespectful to stare into another person's eyes. In crowded situations the Chinese avoid eye contact to give themselves privacy.

 

 

The Importance of "Face"

 

• The concept of ‘face’ roughly translates as ‘honour’, ‘good reputation’ or ‘respect’.

• There are four types of ‘face’:

1) Diu-mian-zi: this is when one’s actions or deeds have been exposed to people.

2) Gei-mian-zi: involves the giving of face to others through showing respect.

3) Liu-mian-zi: this is developed by avoiding mistakes and showing wisdom in action.

4) Jiang-mian-zi: this is when face is increased through others, i.e. someone complementing you to an associate.

• It is critical you avoid losing face or causing the loss of face at all times.

 

 

Collictivism

 

Collectivism vs. Individualism

 

• In general, the Chinese are a collective society with a need for group affiliation, whether to their family, school, work group, or country.

• In order to maintain a sense of harmony, they will act with decorum at all times and will not do anything to cause someone else public embarrassment.

• They are willing to subjugate their own feelings for the good of the group.

• This is often observed by the use of silence in very structured meetings. If someone disagrees with what another person says, rather than disagree publicly, the person will remain quiet. This gives face to the other person, while speaking up would make both parties lose face.

 

 

 

 

Giving gifts to Chinese

 

 

• In general, gifts are given at Chinese New Year, weddings, births and more recently (because of marketing), birthdays.
• The Chinese like food and a nice food basket will make a great gift.
• Do not give scissors, knives or other cutting utensils as they indicate the severing of the relationship.
• Do not give clocks, handkerchiefs or straw sandals as they are associated with funerals and death.
• Do not give flowers, as many Chinese associate these with funerals.
• Do not wrap gifts in white, blue or black paper.
• Four is an unlucky number so do not give four of anything. Eight is the luckiest number, so giving eight of something brings luck to the recipient.
• Always present gifts with two hands.
• Gifts are not opened when received.
• Gifts may be refused three times before they are accepted
• Lavish gift giving was an important part of Chinese culture in the past. Today, official policy in Chinese business culture forbids giving gifts; this gesture is considered bribery, an illegal act in this country. Consequently, your gift may be declined. * If you wish to give a gift to an individual, you must do it privately, in the context of friendship, not business.
• The Chinese will decline a gift three times before finally accepting, so as not to appear greedy. You will have to continue to insist. Once the gift is accepted, express gratitude. You will be expected to go through the same routine if you are offered a gift.
• In the presence of other people, never present a valuable gift to one person. This gesture will cause only embarrassment, and possibly even problems for the recipient, given the strict rules against bribery in Chinese business culture. Do not take any photograph of any gift giving unless it is a symbolic gift presented to the organization as a whole.
• Giving a gift to the entire company, rather than an individual, can be acceptable in Chinese business culture as long as you adhere to the following rules:
• All business negotiations should be concluded before gifts are exchanged.
• Specify that the gift is from the company you represent. If you can, explain the meaning of the gift to the receiver.
• Present the gift to the leader of the Chinese negotiating team.
• Do not get anything that is obviously expensive, so that the company will not feel obliged to reciprocate.
• Valuable gifts should be given to an individual only in private and strictly as a gesture of friendship.
• Make sure that the gifts given to people of the same level of importance are equitable or of similar grade. Somehow, they may find out later, and the difference may lead to strains in your relationship.

 

• If possible, have your gifts wrapped in red paper, which is considered a lucky colour. Plain red paper is one of the few “safe” choices since a variety of meanings, many of which are negative, are attributed to colours in Chinese culture.
• Pink and gold and silver are also acceptable colours for gift wrap. Wrapping in yellow paper with black writing is a gift given only to the dead. Also, do check the variations from region to region about colours.
• Because colours have so many different meanings in this culture, your safest option is to entrust the task of gift-wrapping to a store or hotel that offers this service.

 

 

Gifts to avoid

• Scissors, knives, or other sharp objects can be interpreted as the severing of a friendship or other bond. As a gesture of friendship, if you do want to give these items as a gift, ask your friend to give you a very small amount of money, such as 10 cents or One RMB in return for this gift. By doing so, you would have 'sold' it to him rather than given it to him.
• The following items are to be avoided as they are associated with funerals:
• Straw sandals
• clocks
• handkerchiefs
• four of any item the Cantonese word for “four” sounds similar, in the same language, to “death”
• gifts or wrapping paper in white, black, or blue

 

 

 

 

Health Matters

 

Health matters

 

Before leaving home make sure that you have adequate health insurance, as treatment at local hospitals and foreign-owned clinics can be expensive and China does not have reciprocal healthcare arrangements with other countries.

 

Be sure to get vaccinated against Hepatitis A and B, which are quite common in China. You should also check with your doctor about the need for vaccinations for tetanus, tetanus-diphtheria, polio, typhoid, flu, chickenpox, rabies and Japanese encephalitis (the last of these is only really necessary if you are planning to travel to rural areas). Don’t drink the tap water while in Beijing, although brushing your teeth with it is fine. All hotels will provide your room with mineral or boiled water.

 

In case of medical emergency, your hotel may have a doctor on call or be able to help you get to the nearest public hospital with English-speaking staff (or one of Beijing's international clinics). Take your passport with you and some cash, since some hospitals will not see you before you have paid 100-500 yuan. For international clinics, you'll probably need an international credit card.

 

 

Beijing

 

Emergencies

 

 

Ambulance: 120

Police: 110

Fire: 119

Foreigner Section, Beijing Public Security Bureau (English spoken): 8402 0101

International SOS (provides medical evacuation services for many expats): 6590 9100

 

 

 

Pharmacies

 

Watson’s

Open: daily, 9.30am-9.30pm

Branches of this western pharmacy can be found in major shopping centres around Beijing, including Oriental Plaza, Full Link Plaza, China World Trade Center and Lido Place. In addition to well-known over-the-counter medicines, Watson's also carries toiletries.

 

Prescription drugs can also be bought at any of the foreign-run clinics in Beijing (see Private clinics below).

 

 

 

 

Hospitals

The following hospitals have wards for foreigners, and English-speaking doctors and nurses:

 

Peking Union Medical Hospital

53 Dongdan Beidajie

Dongcheng District

Tel: +86 (10) 6529 5284

24-hour emergency service

 

Sino-Japanese Friendship Hospital

Heping Li

Heping Jie Dongkou

Chaoyang District

Tel: +86 (10) 6422 2952

 

 

 

Private clinics

 

Bayley & Jackson Medical Centre

7 Ritan Donglu

Chaoyang District

Tel: +86 (10) 8562 9990

Open: Mon-Fri 8am-8pm, Sat-Sun 8am-5pm

Medical personnel available after hours

Website

 

Beijing United Family Hospital and Clinic

2 Jiangtai Lu

Chaoyang District

Tel: +86 (10) 6433 3960

Tel: +86 (10) 6433 2345 (Emergencies)

24-hour emergency service

Website

 

 

Shanghai

 

Emergencies

 

Police: 110. Fire: 119. Ambulance: 120

 

 

 

Pharmacies

 

Watson’s

787 Middle Huaihai Rd (beneath the department store)

Open: daily, 9.30am-10pm.

This chain of pharmacies is your best option for minor ailments. There are branches throughout the city.

 

 

 

 

Hospitals

The following hospitals have wards for foreigners:

 

Huashan Hospital Foreigners' Clinic

Floor 19

12 Middle Urumqi Rd

Tel: +86 (0)21 6248-9999 x2500

Open: Mon-Fri 7am-5pm. In emergencies, call the 24-hour helpline on 6248-3986.

 

 

Ruijin Hospital

Building No.38

197 Ruijin No.2 Rd

Tel: +86 (0)21 6466-4483

Open: Mon-Fri 8am-11am, 1.30pm-5pm (phone for appointments)

 

 

 

Private clinics

 

International Medical Care Centre (IMCC)

People's Hospital

585 Jiulong Rd (just North of the Bund)

Tel: +86 (0)21 6306-9480

Open: 24 hours; for emergencies, call 6324-3852.

 

 

World Link

Shanghai Centre

1376 West Nanjing Rd

Tel: +86 (0)21 6279-7688

Website

 

 

This international clinic has various other locations around the city, all listed on the website. 24-hour emergency services for World Link members, including dental care, obstetrics and gynaecology. English, Chinese and Japanese are spoken. Be aware that if you need an operation, the clinic will refer you to a hospital and arrange an appointment.

 

Shanghai East International Medical Centre

551 South Pudong Rd

Pudong

Tel: +86 (0)21 5879-9999

Open: Mon-Fri 8am-9pm; Sat 9am-2pm; Sun 9am-1pm

A joint venture between a Californian medical group and Shanghai East Hospital, this clinic has expat doctors and English-speaking receptionists and nurses. It’s the best option on the Pudong side of the river.

 

Arriving in China

 

 

Beijing

 

Beijing Capital International Airport

 

Tel: +86 (10) 6546 3220/4247

Website

This modern airport, which opened in 1999, handles both domestic and international flights and is just 27km north-east of the city centre. It is still expanding and by the time the 2008 Olympics Games open, will have almost doubled its handling capacity to 60m passengers a year.

 

On arrival ignore the taxi touts who will rush towards you as you leave customs. They will seriously overcharge, even if they're waving “official” cards. Instead, head directly for one of the two taxi lines right outside the arrivals area. The ride to central Beijing normally takes about 35 minutes, depending on traffic, and will cost about 90 yuan ($11), which includes the highway toll.

 

When catching a flight, stay alert for self-appointed baggage handlers (the official ones wear red hats and provide a free service) and for people selling airport exit fees—this is now included in the price of your ticket.

 

 

 

Shanghai

 

 

Airports

 

 

Pudong International Airport

Tel: +86 (0)21 9608 1388

Website

Pudong International Airport, 30km (19 miles) from the city, handles international and some domestic flights. It is linked to central Shanghai via the world's first maglev (“magnetic levitation”) train. This whizzes along at up to 430kph (daily, 7am-9pm; 50 yuan for a single trip) but deposits you on the eastern fringes of the city (Longyang Road Station). That's a 25-minute taxi ride into downtown Shanghai.

 

It is faster, ironically, to arrange for your hotel to send a car, or to take a taxi straight from the airport. Ignore the touts and go to the furthest exit to the right hand side of the arrivals hall, where there is an official taxi stand; you rarely have to wait more than 5 minutes for a cab. Taxis to downtown Pudong (east of the river) will take 40 minutes and cost about 120 yuan. Taxis to the city centre, known as Puxi (west of the river), take an hour and cost 150 yuan. Pudong’s second terminal—an exact replica of the first—will be operational by the end of 2007—increasing the airport’s capacity threefold.

 

 

Hongqiao Airport

Tel: +86 (0)21 6268 8918, ext 2

Website

Just 13km west of the centre, Hongqiao is the older and more central of Shanghai’s two airports. It handles domestic flights only; you may land here if you’re coming via Beijing. In Arrival Hall B, there is a tourist information centre (open daily, 10am-9.30pm) providing maps and hotel bookings. An ATM that accepts foreign cards can be found in Arrival Hall A.

 

Taxis wait at the far left of the terminal exit, but be prepared to queue; it's a 30-minute ride into the city centre (allow at least 50 minutes to reach Pudong).

 

ATM - money

 

www.visa.com/pd/atm

www.mastercard.com/atmlocator/index.jsp

 

Getting Around

 

Beijing

 

Getting around

 

Beijing's public transport system is improving slowly as the city builds or repairs inner-city roads and highways, and new taxis, buses and trains are called into service for the 2008 Olympics.

 

Buses

 

The city is in the process of introducing a new fleet of buses, including some “green” machines, powered either by liquid natural gas or electricity. Most inner-city buses charge 1-2 yuan, with some charging incrementally higher for longer distances. However, public buses in China are often very crowded, and if you don't read or speak Chinese it can be difficult to get around as a tourist. Bus stop signs have the number of the bus route painted on them, and a listing in Chinese of all the stops along the route.

 

Metro

 

Beijing's metro is fast and reliable, and its reach has been extended several times in recent years. A ticket costs 2-3 yuan, and if you need to switch to the new light rail to complete your journey you'll be charged an additional 2 yuan. The metro runs from 5am-10.30pm and the light rail from 6am-11pm. Each station has signs in English, and the name of each stop is broadcast in both Chinese and English.

 

Taxis

 

Beijing began replacing its old fleet of taxis in 2005 in preparation for the 2008 Olympics, and the newer Hyundais and Volkswagens are generally roomier and more comfortable. The charge is 10 yuan for the first 3km, and then 2 yuan per km. Meters keep running while the car is standing. A higher rate is charged from 11pm until 5am. The only time you’ll have trouble finding a taxi is when it’s raining and during the evening rush hour. Few taxi drivers speak English, so have someone write down your destination in Chinese. And be sure to take a business card from your hotel with you so that you can find your way back. Taxi drivers do not expect tips unless it's for service beyond the call of duty.

 

 

 

 

 

Shanghai

 

Getting around

 

Public transport

 

If you plan to be in Shanghai for more than a few days, buy a Shanghai Public Transport Card (jiaotong ka), available in any metro station. You can put funds on it to use for taxis, the metro, light rail buses and the passenger ferry across the river.

 

 

Buses

 

Buses are crowded, smelly, hard to understand if you don't read Chinese characters, but extraordinarily cheap. Most inner-city buses charge 1-2 yuan, no matter how far you’re travelling within the city. Tickets on long-distance buses range between 1-6 yuan.

 

 

Taxis

 

Taxis in Shanghai are good value. You will pay 11 yuan for the first two km, and then 2 yuan per km. The city has about 50,000 taxis. The only time you’ll have trouble finding one is when it’s raining. Most taxi drivers do not speak English, so have someone jot down your destination in Chinese characters and take a business card from your hotel with you so that you can find your way back. It’s always worth asking the driver for a fapiao (receipt), as it has the taxi's number printed on it and so can help you to trace the cab if you leave something behind.

 

Tipping is not customary. Try to avoid hailing a cab at 9.30am or 4.30pm, when drivers change shifts.

 

 

Metro

 

Shanghai's metro is swift and cheap (2-6 yuan), but has only four main lines. The government has plans for seven more by 2010. Until then, you could end up having to walk some distance. The metro has some signs in English and is a good way to cross the river during rush hour, when traffic clogs the bridges and the tunnels.

 

When travelling you can just swipe your public transport card over the card-recognition key pads. Otherwise, you will need to tell the assistant at one of the ticketing counters what price zone you are travelling in or the name of the place you are travelling to and he will give you a one-trip ticket.

 

Crime and Safety

 

Beijing

 

Crimes against foreigners were almost unheard of just a few years ago, but these days visitors should take care. It particularly pays to be alert when going out after dark. Touts work the streets in the areas foreigners frequent and will invite male visitors to go to a “lady bar” or karaoke, citing cheap prices. The bars are invariably rip-offs—sometimes visits result in outrageous charges—and should be avoided. Stick to established bars and clubs in the hotels and to those promoted in the expat magazines (see our Reading section).

 

A large number of young people hang around tourist sites such as the Forbidden City and Wangfujing and present themselves as students. While some just want to practise their English, others are there to cheat foreigners. Talk with them if you like, but decline offers to visit art galleries or teashops, where you may be intimidated into expensive purchases.

 

 

Shanghai

 

Shanghai is remarkably safe and crime is usually limited to pickpocketing. Women travellers can walk around alone without fear of harassment. Male travellers should be alert when venturing out after dark: the prostitutes who patrol the environs of many business hotels can be persistent, though not dangerous.

 

Police wear navy uniforms and police stations usually have a red light and a sign saying “jingcha” (police). Traffic police with ear-piercingly shrill whistles will fine you 50 yuan for jaywalking.

 

 

Suggested Reading

Business

 

 

One Billion Customers: Lessons from the Front Lines of Doing Business in China

James McGregor

A well-written and sometimes humorous insider's guide on how— and how not—to do business in China, by a journalist and entrepreneur who spent 15 years in the country.

 

 

 

Mr China

Tim Clissold

How to set up a investment fund in China in the early 1990s—full of excellent details about the businessman's life on the Chinese road. Read The Economist's review.

 

 

 

China / USA relations

 

While the US is the largest economy in 2007, China is the fastest growing. These two countries have an increasingly interdependent and complicated relationship. In late 2006 and early 2007, the US congress has been venting increasing frustration with the growing trade deficit with China, estimated to exceed $232 billion in 2006.

 

Recent changes in Chinese regulations should help relations with the US. While the Chinese will maintain their currency peg to a basket of currencies, they will start to allow more financial competition in china from US banks who will be able to offer credit services denominated in chinese currency and thus compete against chinese banks.

 

For global warming discussion: it is interesting to note that China currently uses twice as much caol as the US, and could use four times by 2020.

 

 

 

More info about China

 

Business guide

 

http://resources.alibaba.com/book/guidestochina/home.htm

http://country.alibaba.com/profiles/CN/China/useful_links.htm

 

 

 

 

Beijing

Beijing guides

 

That’s Beijing

Website of the weekly, free magazine guide to what's on in Beijing.

http://www.thatsbj.com/

 

 

Beijing This Month

Basic portal with plentiful information about the city.

http://www.btmbeijing.com/

 

 

 

 

Beijing Review

A weekly news magazine.

http://www.bjreview.com.cn/

 

 

City Weekend

An online listings guide, also available as a free magazine.

http://www.cityweekend.com.cn/beijing/

 

 

Shanghai

 

 

China General

 

 

Travel info: http://youstravelers.pbwiki.com/China

 

Video – google - Comparing American and Chinese Negotiation Styles

http://video.google.com/videoplay?docid=4634363396909200237

 

Excellent website with tons of information:http://globaledge.msu.edu/ibrd/

 

Consular Information Sheet : http://travel.state.gov/travel/cis_pa_tw/cis/cis_1089.html

 

Wikipedia:China : http://travel.state.gov/travel/cis_pa_tw/cis/cis_1089.html

 

CIA World Factbook: China : https://www.cia.gov/cia/publications/factbook/geos/ch.html

 

Economist Country Briefings : China : http://www.economist.com/countries/China/

 

BBC Country Profiles: China : http://news.bbc.co.uk/1/hi/world/asia-pacific/country_profiles/1287798.stm

 

World Health Organization: China : http://www.who.int/countries/chn/en/