The MBA Course in China Strategies and the Chinese World
(Please note: AUDC Creative Development Learning Institute is not a college and university, and provides non-accredited training or education courses in business, management, and strategies.)
The MBA Course in China Strategies and the Chinese World (Formerly named Lesson in China Business for Singaporeans only, but later included political, social, educational and other topics, used to be famous in a past Facebook series and in another webgroup. Total there were 43 parts, the original only 38 parts or lessons were answers to my own past friends interested to know more in China. At first they only asked a few questions, but after reading my stuff, they wished to ask further questions and more questions, so why it was stretched to 38, 40, later to 43. Please bear with my grammar mistakes, Singaporean Chinese Dialect and vulgar words. Had thought to publish this series into a book but cost a lot expense, so forget it. Wish to pass on to anyone who wishes to know more into China from Singaporean perspectives. Thanks your time in reading it. Works completed by the author in Singapore from 2008 to 2009, and compiled in 26 August 2010.)
1 I heard many stories from S'poreans "China is a hell place, eat up all your money", "Very risky to do business in China", "China people damn bastard" and so on. Actually business is a "bastard" business, in reality, there's no fixed rules to do business. If there's one, then is not business and is like getting salary to complete a job. In business one must know how to eat people and avoid people eat you. But no such thing people will not eat up you, it is give and take, or win and sometimes lose. But if you know how do business in China, then chances of you getting eaten up is much less, in my own concept. If you still think you are a foreigner in China, then your chances of eaten up is greater. The Chinese custom is try to deal with own people first. Surely we cannot be their own people but getting nearer to that target is just as good. I'm saying to become part of them, or to be halfChinese yourself. Whenever some Chinese like Mao Ze Dong, try to learn why and you become their followers and shout "Long Live Chairman Mao" 毛主席万岁 they will sure like you. Try to be their friends and not just associates, care and concern for them, they will slowly be your good
friends and help you along. Try to praise them, their country and the communist party, and they will think you are part of them, they will be loyal to you, and prepare to talk terms. Getting healthy relationship is first step to successful business in China. If you do not know business is to eat people and avoid people eat you, then you should read up Sun Zi Bin Fa 孙子兵法 (Master Sun Warfare) in Chinese or English version translated by Samuel B. Griffith (UK) sold in Borders Bookstore (red cover). Most of the Chinese read this book and you will be at losing end if you do not know the rules of the warfare, then you must really get eaten up in China. If I was a Chinese, I will also eat up S'porean who don't read Sun Zi Bin Fa. Hahaha The first book Sun Zi Bin Fa or The Art of War is mainly for strategies to external enemy and how to organize your resources, but it did not elaborate on how to control your budget and resources, there are rules. You can read up a book by Tao Zhu Gong 陶朱公 in Chinese, no English version yet found by me. In Tao concept, having a healthy organization of internal side will prepare you in the long run. Tao was also born in Jiangsu in merchant clan with ancestors in Shan-xi 山西 province called Jin-Shang 晋商 (Jin merchants) Today Jin-shang are very skilled in trading, and during Min-guo era were bankers in Shanghai. In conclusion of first part of lesson, having a all-rounded strategies and planning will get you healthy in the long run. But as I said there's no fixed rules, these books and Chinese literatures are just a guide, the rules always change according to the times. It is much better to keep up with unfolding events happening in China now. But surely try to be a foreigner in China and avoid learning about China is a much greater blow to your business in China. No one should be blamed, not even the "bastard" Chinese, but you must blame yourself for not being more "bastard" than them. Hahaha
2A What are the true characteristics of a Chinese?? Found S'poreans, (Malaysians are more similar to Chinese) do not know how to behave like Chinese though we call ourselves Chinese. Try to look at all the Chinese Nationals in Singapore, you learn something from them, but those are basic staff. If you want to be successful merchant in China, then you will need to learn behaviours of "bastard" merchants and businessmen in China, how they speak, think, listen, react, organize their thoughts, words and decide. If you learn from the Americans who do business in China can
be a starting point for your learning process, but not enough. Try to be more humble and not do business in China, try to be their servants and employees, you will learn a greater deal from your China bosses, as I have learnt from them. If you can behave nearer to true Chinese, they will like you and wish to do business with you, but if you behave snoppy, it is most likely they will eat up you. I will explain in part A & B what are the characteristics of Basic Chinese and Business Chinese in China. I have attended Management classes, the first lesson I learnt about management is know how to manage yourself then you can manage the process. If we don't know how manage our appearance, not only the process is very messy, we will become very messy and the only way is defeat and leave from the process. Think this is true of S'poreans who failed business in China, as they don't know how to manage the China process, and they don't know the main cause of their failures is themselves, who failed to use China management skills. Being a Chinese is part of knowing how to manage yourself in China. If you don't follow as the Romans do, not only the Romans don't follow you, but your war in Rome will turn into great defeat. Try to learn how to behave as the true Chinese, and they will slowly like you, and will sit with you. This is also very true in other countries. When I studied in Australia, I have made friends with the Greeks, who also liked Chinese culture and they also agreed to know other cultures was the true way to do business with others. The Greeks in Greece are also like China with many thousand years of experience. The Basic Chinese characteristic is humble. When you see me very arrogant here and talk very loud, when you see me in China, I will become humble and soft because without being humble you can't survive in China well. I will try to be humble and speak nicely, that is why China ladies like me, and they told me they had never seen S'porean so humble in China. That is S'poreans don't know the way to get through successfully in China is to be humble so why they fail, we only boast our way, showoff S'pore is No.1 in the world. Chinese will think, since you are No.1 in the world, why come to China, as S'pore is so damn good??? The second basic is to be brave. Chinese like people to be brave in words and strong in thoughts. When I said brave in words, not bullshit but to be confident in yourself, your self confidence is at the highest. You must be brave to take up any challenges. Chinese way is to take the job first, then consider how to do. This is also way of Taiwanese and Malaysian Chinese. S'porean always want to consider the pros and cons, the consequences and to think too much, so why makes the Chinese lose confidence in us. To be brave in thoughts you are always ready to answer them even though you don't know the actual knowledge. This can be bullshit but bullshit is 20% truth and 80% nonsense. To be ready and brave in thoughts and words you are at least 50% confident and need to back-up with another 50% when you leave the meeting with Chinese, and quickly do your own research and study. I saw many S'poreans don't dare to commit 100% but told Chinese they need time to go thru the books and answer back, that's where we lose our opportunity. Even we don't lose the opportunity, Chinese will surely eat us up, slash our prices by more than 50%. That's when we find we can't cope with the less favoured price, that we will decide to withdraw. But why Taiwanese and Malaysians have successfully dealed as they are brave enough. The third basic is to be able to keep your thoughts especially your weaknesses. S'porean is easily
exposing our own weaknesses, whether we unhappy can see from our faces, or angry, scolding Hokkien vulgar language all over the place. In China I saw S'poreans could easily expose the unhappiness when face a difficulty situation in the meeting. We must learn to hide our negative feelings from the Chinese, or they will think we are on the weakest side, and they will feel very happy how to deal with us. In S'pore I always expose my weaknesses as I know we are more direct, can scold people and quite honest. But I have to warn you, if we are like this in China, we are dead flat, very flat. So why I always on the 300% alert in China, when I decide, have to recycle in my own head 3 times before I am ready to commit. When I sleep in China, my mind is still alert, so why I sleep lesser than in S'pore, usually 5 to 6 hours is enough, in S'pore I wish to sleep as long as I like. As you sleep too long, you will feel lazy and your mind is not alert, so why I sleep lesser in China to keep awake. The above three basic points are gathered from my own experiences in China, of course many more. In the next part I will touch on Business Chinese how they are "bastard" dealing with business enemies. In all business books, there are two books, the white book and the black book, in all walks of life we must learn how to use both books, either one of both is not enough to survive in life. You will be successful but for a short period as you use either the white or black book but in the long run you will be defeated. Very good businessmen will use both books. The White Book is the book of noble tactics and the Black Book is the book of dirty tactics. How to use will depend on who you deal with. I will cover this in the next part B.
2B This is the longest lesson of whole 40-lessons lecture, because previously I only stopped here to explain the whole concept of China Business, but later my friends were interested to know more, kept asking and asking, that's why in future lessons I had tried to cut shorter, this one was too long but very important. I have attached a new map of China in this lesson and new part 2B.5 to explain the business regions. China in many cases is still a developing country although they have many advances in the economy and technology. A developing country has not got all their system put into place, so why using a developed country system to use there is at your own risk, surely many businesses are having hard time to cope. But recent few years China is progressing in policy-making and system, in some areas already got a well-placed system but believe me they are still a far long way to implement them. When I first stepped on China, I felt they had laws but disorder, they
had system but lacked control, they had methods but not follow them through one by one. They had many back doors and under tables. Actually this is good to get things done easily and faster but in long run harmful to whole business environment. I feel my part B needs to be sub-divided into a few sub-parts. As I said in part 2A, in China got to use both White Book of noble tactics and Black Book of dirty tactics. Likewise in China there are two types of business: Normal Business and Abnormal Business. More and more in recent times many are going into normal business through the proper system and laws of the country, as some well developing cities such as Beijing, Shanghai and Shenzhen you can go into such businesses and they also wish to encourage you but you must have very high capital and afford to pay high taxes, giving your manpower stated benefits. That's why many S'poreans could not afford and they went to invest in lesser developing places where they can bribe the officials and bully workers by giving mean payment and force them to work harder. Have heard many complains from people in rural areas coming into the cities that S'pore employers bullying them by giving them very low pay and treating them as slaves. Actually many S'poreans were obsessed by such rich images in China that in short time tycoons emerged from nowhere to multi-billion business, then could buy many luxurious cars and bungalows. Such things really happened but they are going from the back doors, either they were ex-officials and got many connections or they bribed all their way to the top. Such businesses also got many loans from banks and they live on credit. Recent times exposed their business background as China is slowing down in strong growth. Wish to say better not follow such examples in China as you can't play such games with them in China. (你玩不起) In part 2B.2 I'm going into to explain a typical Business Chinese characteristics, and more into the business environment. My discovery of business tactics in China when I studied Management classes and when I was young to learn about Chinese classics in 老子 and 庄子, both of these greater philosophical masters had good ideas how to tackle the daily life problems as well as bad people. But Buddha also said both good and bad people happened in one instant "念" or second moment, and is from one person alone. All of us are the same as we can be both good and bad people. That was why I mentioned we have to use both the White and Black books to counter solve our problems. To lie is evil but lie to bad people not evil but is noble. Likewise in China many people used both books and depends on how much the weight of which book they choose to use. But as Taoist 老子 also said by leaning towards either one side of good or bad is not enough, should achieve a ying and yang balance. Buddha calls this as the middle way or middle path. Chinese are learners and they learn daily in books and media, and by chatting with many people. That why they are always improving and if we are not improving, if we face such improving enemies, very easy you know whose on the weakest side. As I mentioned earlier how a businessman from S'pore should behave, likewise I learnt it from how the China bosses perform. They are composed, patient, listen, keep to their own thoughts, not revealing negative feelings and they are not always want faster to react each situations. They feel time is most important, they can gather all the facts but they don't want to commit at once.
Win or fail is also in just one instant. That second you make a hasty choice from start to end you have already failed. That is also why in a China meeting your composure and external appearance is the most important, from one second moment if they see you are impatient and not sincere, the deal is broken or they will slash you. I have seen many different races businessmen all over the world, Americans, Australians, Greeks, Indians, Indonesians, etc but I find China people are the most patient and decisive in their business. In the next part B.3 I will discuss the proceedings of a typical meeting environment in China and how to deal with the Chinese. In part B.4 I will touch on some of necessities I think can be of helpful to S'porean businessmen to close this long lesson. In lesson 3, will start on topic of some of norms in China and how they are different from ours.When I returned to home and in my bedroom saw a book I bought in 2004 in Shenzhen, "China Style Management Behaviours", 中国式的管理行为 written by a Taiwan professor. This book has been in the top 10 Chinese management books for the last few years and well read by overseas Chinese businessmen, giving simple and easy understood theories how to manage China business environment. He wrote there are four types of Chinese behaviours: harmony, open-mindedness, holistic and respect among businessmen. Harmony: He said to be in harmony with Chinese, no need to bribe or SLP Chinese. In fact Chinese hate to be SLP. When you SLP them, they take it as a face-value but will not give in so easily. (SLP - So-Lan-Pa or touch their backsides meaning using back door ways to get in and win flavours from behind) Open-mindedness: Chinese believe to listen to instincts or what they call "天命" or heaven's heart. Think this is very true, Chinese can be both rich and poor, they don't mind to be poor, but when they are rich, they are very rich and make full use of opportunities. They will go all out to dash, after all take the job first, think later how to deal with, best to listen to "天命". Holistic: Chinese are very patient people because they are cultured people, they know a process needs time and best to go through a process is to continue to push, drag and pull the matter along. They will first push the matter, if unsuccessful they will drag matter until next suitable time, finally they will pull the whole matter out to resolve in a new manner. I said before in China business needs patience and the more you are hasty you have failed. Today I just shared an episode with colleague that Liu Bei 刘备 went three to four times to beg Zhu Ge Liang 诸葛亮 to be his Marshal but failed, actually this showed Chinese were very patient and this is same process we must go through to make our business successful in China. Respect: This is what I mentioned before, Chinese actually don't like to be SLP but if you respect, care and concern for them, they will be friendly and loyal, then they will help you. They also not wish to blindly follow others. They wish both sides can achieve Win-Win. Actually I can simply copy the whole book and explain them here, but I think my exposure also worth a few cents, and wish to share my own first. Back to where I left in part B.2, in this part I wish to explain how to deal in typical meeting in
China. Whenever you start a meeting in China, the introduction is very important. The Americans have written many books explain Chinese wish to start a meeting with introducing words to make dialogue lively, but Americans do not know why. This is actually a tricky part in China culture. They are actually testing your background and wishing to see your motives, and also to tell you their objectives. Let me begin with following dialogue: Mr Jiang: Nin Hao, Mr Tan, welcome to China, very nice to see you. (I'm Mr Tan Edward) Mr Tan: Nin Hao, Mr Jiang, long time no see, I'm also happy to see you. Mr Jiang: I heard Singapore is a nice place, clean and beautiful. I know three facts about Singapore: You have Lee Kuan Yew, S'pore is a clean and beautiful garden city. I wish to visit your country one day. Mr Tan: Of course, I will welcome you when you visit S'pore. I heard your project is trying to use Merlion City as project name, is such a wonderful name. Merlion is from S'pore which is the FishLion. Mr Jiang: Yes, we think Merlion is a nice name and a strong name indeed, that is why we wish to welcome you here. Let us begin our meeting. I have following questions: Why Mr Jiang welcome me? Why he wishes to say about the three facts of Singapore? What do we give and what should we give to him impressions? Of course Mr Jiang looks up to S'pore as a gold mountain, S'pore is such a brand name and can be used in all products in China. When he mentioned Lee Kuan Yew, he also wishes we can be like Lee Kuan Yew, strong in words and thoughts, self-confident and motivated, that's why he mentioned Mr Lee. But on another hand, if we scold vulgar all the way and express unhappiness and negative feelings towards Chinese, they will straight away think how come Mr Lee's fellow citizens are so rude and do we need to carry on do business with these crazy people??? That is why they mentioned Lee Kuan Yew and we better need to perform similar to Lee or your meeting will be a complete failure. That is why the first impression all happened in the very first introduction before meeting. In all situations in the meeting, everyone must follow a standard meeting culture in China. There is always a Chairman who organizes the proceedings. He will first introduce who is attending the meeting and a short background of persons, usually their company and the posts they hold in the company. There is now additional culture after personal introduction that is exchanging name cards or handphone numbers. Then meeting begins, Chairman will ask the first person to speak. In my case to discuss about Merlion City project, the designer will speak first giving short background of project and the design. Then the senior designer or boss will speak to give additional notes. Then Chairman will ask the owner and following other managers in his team to give comments and impressions about the project. All these speeches were recorded down. After all the people have spoken, there will be Q & A and open dialogue to share. Finally chairman will usually ask the owner gives a final speech to round up the whole meeting, and chairman will finally add his own comments and ends the meeting. Of course after meeting will have a tea session, at that moment if you
have any more questions, you can continue. Chinese hate especially during a meeting someone breaks the order and fights to speak, and worst still, add vulgar languages to insult anyone in the meeting. Chairman will order such meeting to end immediately, no point and mood to discuss matters, and worst your business deals will come to an end, and more worst if opponents got insulted by you will get heavy "punishments" in form of violence, police trouble and even law suits. In all cases try to be calm and follow the whole proceedings of the meeting. Even what you hear is unwelcome to your ears and you feel you are unhappy, try to hide inside you and just smile away, don't worry and be happy. The proper way is not to embarass your opponents and even yourself in front of other people, but after meeting, call up the Chinese and have a separate meeting between two people to explain your unhappiness. In meeting you can record down what you feel about the meeting. Sometimes your Chinese opponent does not have time to meet you on another day, post your record to him will be the best way, then he will read your record and may be call you to discuss again. You can email. I will try to shorten my lessons as now find some of the previous lessons can be stretched out to be even 3, 4, 5, 6, 7.....so on. I also received feedback they are starting to get into interest of China, and received valuable comments that I can know how to give better tips. If you have any questions, please email or just give me a call to my handphone. In the first lessons I have touched on very interesting things many S'poreans may or may not know, but into too microscopic things. From now I am zooming out to see business in China from a bigger picture. Then later I will zoom in again and you have a clearer picture why things happen this way externally and internally will be my last few lessons. Things are starting to get interesting. In this part 2B.4 I will explain some of the norms in China, these may be familiar with you already. China is such a big country, you can treat it as a big country but I treat it as a continent similar to Europe, why? We make a comparison between the two. China is just as diversified as Europe with many cultures. Though in China you found all over the places have the "Han" tribe, but our Hans have many different versions and they are at odds with one another. In China if you treat each tribe to be the same Han, you are wrong and you will get hit by them, chances of your business is zero because you have insulted them. In Europe you cannot say British the same as French (we compare cultures but not nations) or same as Hungarians. Likewise we have to treat China as a continent under the same rules and laws of one nation but with different treatments. Sichuan province itself with both population and land area are already bigger than France. ć–°ç–† Xinjiang in the west bigger than any country in Europe, actually bigger than Western Russia, but we cannot treat it as a province or AR Autonomous Region. Hope you understand from this point on. Thus Beijing in cultural sense is not only capital, even in commercial sense, they cannot control the East, South and West in actual fact, though it is the national capital. Many S'poreans have misunderstood this and they will send feedback to Beijing or even ask Beijing's S'pore Embassy to help. But when our emabssy happens to ask Guangzhou city government to look into it, Guangdong people just put your paper aside, why Southerners should look into matters for the
North?? Is their thoughts. The proper way is seek S'pore consulate in Guangzhou to help, of course they will seek permission and opinion in Beijing S'pore Emabssy but they will deal the matter in the south. Why this type of troublesome ideas?? I have told you before Chinese only deal with own people first, even foreigners will treat those nearby them. China is in fact not matured to be a nation in nature but by force, by military revolution, their minds are still Min-Guo era 民国期, quite bureaucratic and feudalistic so to say. They also called themselves as Da-Lu 大 陆, great continent. Thus you must recognize in commercial sense China has four capitals: Beijing, Shanghai, Guangzhou and Chongqing. 3 of these cities have been national capitals, Shanghai is the banking capital. Actually I prefer four capitals than one Beijing. You can treat it as bases to venture into unknown territories for your investments. Also for small ventures don't think you can swallow China in your lifetime, then you must be a big fish or corporation. Best to start from one of the 4 bases which you are confident in. Some may prefer invest straight into unknown territory, even so, best you make one of 4 bases as your base. Why I said so?? I learn from naive S'poreans who were quite stubborn. One time I met S'porean who want to open a bar in Hainan, we discussed his investment and he wanted to order materials from S'pore as he can't find in Shenzhen. I said will be expensive venture to order from S'pore, surely can't find in Shenzhen as it is only 8 million people at that time. Why not see in Guangzhou?? He told me not been in Guangzhou but I asked him to make some calls before he traveled there. Finally he went to Guangzhou and he even found the things what he expected to see in a S'pore bar, and he's very happy to me. He invited me and my exwife to his bar opening. Also heard from naive S'poreans who opened factories in rural areas then also import from S'pore materials, they were not my friends but I happened to meet one of them. Finally his factory cost was too high and he was closing business to return home, complain hard to do business in China. I asked him why he did not go to Guangzhou to take a look may be he can find the materials he wanted. "Guangzhou?? I have never thought of that, Beijing is too far for me!!" See S'poreans still treated China as a country, not a continent or Da-Lu.
I have added new part 2B.5 in this series (first time ever) to explain the attached map of China I have just drawn up. As explain in previous part, four commercial or business centers Beijing, Shanghai, Guangzhou and Chongqing. Beijing controls 华北 and 东北 regions, and part of the 西 北 region. Shanghai controls 华东 and 华中 regions and the entire length of the regions along the Yangtze River. Guangzhou controls the 华南 and 东南 regions, and part of the 西南 region. Chongqing controls the 西南 and 西北 regions. Then in each region, there's some important regional centers, that connected with each megaregional centers to form an economic grouping, so there's 渤海经济区, 长三角经济区, 珠三角经济 区 and the newly developed 西四角经济区 but this name is just a concept name not official yet. Then there's ports which also act as important business centers unlike other smaller ports: 大连, 天津,青岛,连云港,宁波/舟山港,深圳盐田港,北海. Also you must remember there's CEPA a grouping initiated by Beijing and HK to help HK economy enter intensively into Mainland and develop the Mainland local economy. So Beijing entrusted the southern 9 provinces except Chongqing 重庆 and Zhejiang 浙江 to help HK and Macau economies.
Note: 华中 in the middle very hard to be developed as squeezed in-between all the neighbouring economic groupings but Wuhan 湖北武汉 is fast developing takes time influence whole HuaZhong. Changsha 湖南长沙 is quite developed but city still small. 江西 Jiangxi sandwich inbetween mostly influenced by Fujian Hunan and Zhejiang 福建、湖南、浙江 but now part of 华东 region. 贵州 also under-developed, hopefully CEPA with HK investors can help to liften up. 青海 although isolated, very advance, rich in resources of oil and gas. 吉林 sandwich between 辽宁 and 黑龙江 serve as their sub-contractor but received investment from overseas now, very cheap labour but highly skilled in the heavy industries.
3 Continue from where I stopped, China should be treated as a great continent or 大陆, not a country. That's why in actual fact to invest into one China is enough, putting money into too many baskets like Malaysia, Indonesia, Thailand, Vietnam, India, Taiwan, Middle East and so on will jeopardize your cash-flow and balance. Actual fact world economy is linked and rise and fall in economy is the same throughout the region. Asia with such diversified cultural differences is quite a big headache to some smaller business ventures, why waste your energies in studying each of these countries and know how to do business in each of them??? China is already too big, and we are still learning how to get hold of the market. I recommend you just concentrate in China alone. I have already half way into China know-how and you now ask me to venture into Vietnam or India, I am reluctant, why waste time to start all over again??? I have only 19 years left as an executive and should not wonder in too many places, how much can I profit in all the countries of Asia??? One China is too big already. Wish to share some of the norms in China. You can read this book by American spending more than 30-40 years in China and already knew some of the basic business etiquettes, entitled "Chinese Business Etiquette" Warner Books by Scott D. Seligman, one of best books in America to learn about China business manners. What he said were really true and similar to my experiences. These Americans who went to China know Tang Dynasty poems, recommend you to learn by heart a few Tang verses 唐诗 will be helpful to you in China to win attraction, I am still a beginner in Tang verses. Scott began in Chapter 1 that we were engaging in an interpersonal relationship of 2,500 years old in China, not a modern China as what you are seeing now. To my believe, China is only using the Free Economy Market as a mask to cover up their ancient ways as they know very hard to get rid of their ancient ways. To do business in China, you must know history and geographical factors in each province or even county as each is very different. There is this question a few days ago that someone asked will Chinese get in touch of all our S'pore contacts if we failed our deals, that is to say someone other than us in S'pore will snatch your business contacts. My answer is NO but that person did not believe me as still see China as a country like S'pore, of course S'pore is so small how can compare with gigantic China??? In Chapter 2 Scott explained Chinese do not like to do business with strangers or people they
have not heard of. If they have known you only, is your best chance to perform your very best to impress them. I have come across a business meeting in Zhuhai 珠海, only two competitors from "overseas" across China territorial borders, one by my ex-boss with a Taiwan client and the other HK client wished to invest in a automobile city complex with very large car exhibition hall. Both Taiwan and HK, as well as Macau, are still considered "Overseas" 海外 as their systems are different from China. The Zhuhai land owners did not wish to know any other people as they are very familiar with the Taiwanese and HK people. The business in China is done in "Guan-xi" 关系 interpersonal relationships, and anyone outside the arena is considered out of bounds. That is why making friends in China is very important and the way to make friends really treat your friends with care and concern. You will never know how poor your China friend is, will one day introduce a deal, just one deal enough. There are many things to learn from Chinese, one thing I wish to make very clear to many S'poreans, is they have a seating order in the VIP dinning room in restaurant. Found many S'pore bosses, not to say stupid executives, do not know of this "invisible" territory in the China restaurant. First you must know and quickly sit down before your host sits down. They knew we do not know but they will give us time to adapt. Found many S'pore bosses still cannot adapt and they will ask the host whether can "anyhow" sit, of course the host said OK but not very happy. One table or two in each VIP room is the same order. Host is to sit facing the door on the centreright, while the chief guest sits in the centre facing the door, so the waitress will serve the chief host first in every dining order. The interpreter if there is any will sit next, centre left facing the door. In the next table, the second host or second manager will sit same as first table except all the backs facing the door. This is to "bao qian and bao hou" 包前包后 surround the front and back, what conversation said is between these two tables in the VIP room. So no such thing as "anyhow" seating order 随便坐位, can your business deals be in "anyhow" order 随便签订??? Or paid in "anyhow" money terms 随便付款??? hahaha
4 Apologized, my mistake lesson 3 that I wrote to serve the chief host first by waitresses in VIP room, should be chief guest first as he is sitting centre facing the door.
Next I wish to repeat again somethings I said in the past about construction business in past topics, as part of series here worth interesting to note. There are two things important to note. First if you don't register your company in China, whatever dealings in China on personal terms are not the business of China authority to care. You don't complain to police or Gong-shang-ju 工商局 (Industry & Commerce Bureau) that someone you deal in China unfair and you want to sue him. Of course you can sue him but the China police and Gong-shang-ju 工商局, even Beijing government will not care about you. But if is found you are unfair to him, and his company is registered in China, of course the police and gong-shang-ju 工商局 will interfere, and you will be at the most disadvantage side. I've seen many S'poreans don't know this order and they have suffered very much, then said China people were bastards and very hard to do business in China, all the nonsense. If you don't want to register in China OK, then you better rely on your most trustworthy associate to cooperate, but anyone in the world at last will be tired of your friendship and eat up you very soon if you make bigger dollars than him. Try not to register in China is really at your very disadvantageous. Then again if you not register in China, the contract you sign in China is void, and again your friends will eat up you if they rebel. You can send your contract to Gong-zheng-chu 公证处 or Notary Public Office to be stamped and certified the terms are OK recognized by China laws, but again depends where you deal. If Shenzhen and Shanghai laws and procedures are many and complex, they will sure ask for your company registered cert in S'pore and again wish you can get that cert certified at S'pore China Embassy. If Hainan easier as the people at Gong-zheng-chu 公证处 just want money and if you explain clear enough, not so troublesome, you can get your contract certified and stamped by Gong-zheng-chu 公证处 stamp and you are protected by China laws. Then your associates try to rebel, you can complain to Gong-shang-ju 工商局 and they can take action. Best better register in China as a foreign invested private company, you pay taxes but in some places where they offer lucrative incentives you will not be taxed for the first year at all. Once registered you are a boss in China and people respect bosses, and police and authority will listen to your questions and help you to the best they can. The Gong-shang-ju 工商局 is also nowadays very high tech like S'pore where you can apply forms online and get info you need in internet. Then you are taught how to operate a proper company in China and you will soon find operating company in China is as easy as 123 or ABC. Why make your life so hard by going from back doors??? Also nowadays in China I heard many S'poreans try to smuggle Ren-min-bi out of China and get caught. The jail sentence is very heavy, at least ten years. To sit in jail no joke in China not like Changi beach holiday prison. What you can do is to open bank account in China and you can withdraw 20,000 RMB everyday from overseas ATM. DBS / POSB ATM can even check your balance in China in S'pore dollars but each transaction is S$1. In China where you registered a company, can apply with banks to transfer your money out at least US$100,000 each day for small companies depends on your company size, surely must pay a bank fee. Nowadays very easy to do business in China yet S'poreans wish to come from back doors and get punished.
5 I also heard from many S'poreans that they got business through their friends who knew who and who in the company or government bureau, then bribed them to do business so to get links and leads, finally hope to get business, even after business awarded and to continue bribing them to successful completion and got the money. In the past you can do this bribing everywhere but now under President Hu Jin-tao admin very strict in catching corruption. Many officials I knew either sacked, demoted or asked to retire earlier. Many bosses who have illegal links with officials get punished. Government can easily sentence any bosses as many of them have failed to pay taxes on time. Let us discuss in general sense the issue of bribing. Actually bribing is not very effective in securing your business or even get payment on time. Most of them will bribe the CEO or Managing Director of company. If found out they are corrupted they will be sacked. Or in the government bureau if you bribe the bureau chief or vice chiefs (usually 3 vice chiefs) also very hard to get your project proceed ahead. If you want to bribe, best to bribe the top most in the departments. For projects are chiefs of planning bureau or construction bureau, now they have been combined as the planning and construction bureau. Even he is transferred or demoted, those chiefs below with links with you can perhaps continue to serve you. But China officials now also know how to change "blood" and they will replace chiefs with their own "Kakia". That is why best get to know the owner of corporations or the mayor or vice mayors of cities then you can get your projects proceed with ease. Now many foreign investors go all the way to the very top hope to get business or ask for deals to get through, do not ever bribe the officials below the chain. There is also another way to set up business, to work your way hard and set up business in China without interferance with any officials. But many S'poreans always want to think big and bigger in a short time, very impatient. In fact this is a better way than to bribe the officials to get business, of course with luck and hard work. Once you have established your business in China with fame, the officials will notice your presence and they will visit you, perhaps ask you to try out one of their projects, automatically you will get business. With hard work and patience, you will grow from strength to strength, better way this way than to bribe officials and get punished later. With such great potential market, very soon your business especially with foreign presence will gain fame and ground if your success is depended on integrity, strategies, hard work and patience.
6 In past lessons I only concentrate in business for current bosses, in fact from this part I wish to explain business for would-be or potential bosses like some of you, to promote yourselves from executives level to potential business owners. In Singapore potential business owners are nurtured in popularity by becoming a real estate agent or join the direct-sales chain selling perfumes, shampoos and medicines. I wish to say you can start a business yourself in China without even away from your office desk. Many office workers do not need to get away from chairs everyday but behind they are making thousands and even millions of RMB going into their pockets. Of course what comes to your mind must be stocks and commodity market, can be part of it, but what I wish to say is helping to recommend products or services to potential customers in your own field, construction or building design. I learnt this when I worked in China. One day I saw a salesman being introduced to my ex-boss by my ex-colleague, both of them went into my ex-boss office. After that meeting both came out my ex-colleague told salesman must continue to keep him informed of the progress, salesman said OK. Later my ex-colleague and his girlfriend went to HK to tour for one week. In my mind how come an engineer with only 2,000 RMB per month at that time can afford to tour in HK and spend for his girlfriend?? Then later many salesmen also came to me and asked me to promote products. Even I went to digital design offices and they will ask me to promote their services, promised to give 10% commission or more. Many small bosses worked their way up and started own businesses by doing sales for other products in their earlier years. In China this is not illegal and China bosses know all their staff have external businesses. In Singapore this is illegal, that is why many staff are still staff throughout the whole career life. You can check out with many of your friends in China and they have become own bosses or partners in other companies. That also why many S'poreans who become bosses do not wish to return back here to be employees again. Also many staff in S'pore will think they have no potential to be bosses, but this is not true. Everyone is your potential customers and everyone has something that unique. Trading is to bring all the unique things together for everyone to look at and buy. If only bosses can trade, then what a small market S'pore is, and surely not an active market. Many S'poreans do not know this trend in China when they first started to be employed in China, but slowly they have benefited from the external business. Also there is also another trend in China not known to S'poreans, that is not compulsory
architects must be bosses of architect firms, or hoteliers to be bosses of hotels. Anyone can be bosses of any type of businesses. Real estate developers can be bosses of the architect firms and orders the architects to change design. Or textile merchant who opens a hotel to ask managers to change service quality suit his tastes. If you have interests in any businesses but don't have the diploma or know-how, as long as you got money and the contacts, you can start that business you desire. Money is power in China not those necessary qualifications like Masters and Doctorates. Some bosses I saw were gangsters who had little education but Taiwan vulgar "NiNia-E" or China vulgar "Qu-Ni-Ma-De" one word to all his staff all must follow his instructions.
7 More I wrote these lessons more getting interested in business again. My long wish is to open a hotel in Sanya, a South-east Asian style hotel like our chinatown house type of hotel because this is still unique in China. Just a few stories with about 20-30 rooms with a South-east asian restaurant below serving Thai and S'pore food, at night is a bar. Then I can start my office in one of the hotel rooms designing South-east asian bungalows or do interior design for customers, also selling some products, so one of the rooms as display showroom. But I need capital. If you are interested to joint venture, please contact me and we can get very rich quicker in China, without being bullied and scolded here. Why in Sanya??? Why hotel??? Sanya is the best tourist spot in annual sales figures in China, every year can get 2-3 million tourists in peak seasons such as Chinese new year and National Day week-long holidays, average 600,000 tourists monthly. The real estate market in high class bungalows and condos is one of the best in China. Naturally hotels is the best business and can be my master showpiece to display south-east asian designs. In Southern China in Guangdong, Guangxi, Yunnan, Hainan and Fujian, south-east asian design is very popular among developers and buyers, considered luxurious property have in their lifetime. Even in northern China is considered unique design but not so suitable in north China. Also start a hotel have two types of registration to be offered. You can register under the Global Star system from one to five stars but rules are stricter. Or you can register under the China Star system from one to six stars, easier to get. For my ambitious hotel I can register up to China 3 stars which is good enough or even 4 stars. Then I can market my hotel with 3-stars market prices, currently in Sanya from 400 RMB per night for standard room. In peak seasons can increase to 800-1000 RMB per night. I already have the design in my mind for what sort of
south-east asian style suites and what sort of services offering to my customers. Tell you very encouraging indeed if business is very good, we can open two more branch hotels in a few years. As China moving away slowly from export economy, see they find many problems selling milk powder, shifting their focus to future local spending economy, tourism and services will be lucrative businesses. Actually the market potential for tourism is only over 20% as compared to European standards of 70-80%, China has a huge potential market in hotels and tourism, many times of space to grow from. Come on, construction actually becomes a less profitable business, even real estate, how much profit can you earn?? In today's terms 10% profit to developers is minimum target, in recession only 2-3% profits can get. How to grow bigger??? Everywhere is same in the world. But tourism could yield at least 25% or more depends what sort of services you are offering. Also the operating costs of hotels and tourist services are very low, using low costs to get higher profits should be the true way in business.
8 When we work or do business in China, every S'porean must know how to hide two truths from Chinese, or else at your own most disadvantages, that is the size of Singapore and sometimes must hide the truth that you are a S'porean. My experiments chatting with Chinese showed that Chinese will look up to you if you are richer or your country is wealthy. Actually many Chinese do not know Singapore is small to the limit of only a bit bigger than 700 sq. km. This is even smaller than some of China villages or ć?‘. If you say Singapore is 25 times smaller than Beijing, people there would look down us, and surely your business deals is also zero. So you must bullshit, this time you must really bullshit, Singapore is economic strong and wealthy, and not mention size. To many Chinese in their minds they thought is even bigger than Hainan Island, but in fact is smaller than Hainan by 63 times. I warn you don't "MALU" S'pore in China. Also in China, especially they don't know S'pore much, is best to your advantages to say you are from Hainan, Guangdong or Fujian, and not S'pore. Then you will not be slashed or axed by
Chinese in price when you shop and spend. Chinese will not slash own people a lot, but to foreigners, especially S'poreans, Koreans and Japanese the axe is very big to chop off you into pieces. I have tried this out and very successful to lie to Chinese whom not familiar with me. Even you can call yourselves as Malaysian as they don't know where is Malaysia, but warn you don't ever say S'pore is an island below Malaysia, very MALU for you. Only when you need to market our S'pore products, then you say you live in S'pore, but not S'pore Island, I warn you. As I said before don't showoff S'pore is No.1 in the world, just say we are very developed and they can learn from us. If No.1, why need to come to China, since S'pore is so damn good??? Also by saying you are No.1 you will be faced with an axe that is also No.1 big in the world, you will suffer worser than any foreigners. (你自己取得) Don't be hao-lian. And also don't get praised for nothing, example Chinese praised your S'pore very good and you feel very happy, by the time you face their big axe you will be less happy. Try to push away all such praises and say S'pore where can compare to China??? Be humble. Once 3 tourists from Singapore departed to tour Hangzhou in China, when they reached West Lake 杭州西湖. They were colleagues working in a Semi-conductor company here: a Chinese National, Malaysian and Singaporean. When their bus approached a station near the lake, they saw a stall selling Hangzhou Long-Jing Green Tea 龙井茶 tea leaves. China National volunteered to ask the tea boss. How much per kilo?? (our kilo is 600g and China kilo is 500g) The boss saw the Chinese didn't dare to slash him, OK RMB 75 yuan per kilo, the Chinese asked boss can give more discounts, he's giving to his parents as birthday gift. Boss saw he's a good son, OK charged RMB 65 per kilo. The Chinese was very happy. Next the Malaysian asked how much. Boss asked him which country he's from, as he's not like a Chinese, "I'm from Malaysia" "Where's Malaysia??" Malaysian's very smart, he knew cannot say near S'pore, so he said just a country in South East Asia. Then, boss said OK RMB 150 yuan per kilo, after discount, Malaysian got RMB 125 per kilo. Finally S'porean turn to ask, he said from Singapore. Boss praised him "Ha?? You are from Singapore?? (smiling) Singapore is a very good and beautiful place, my brother told me. OK RMB 250 yuan per kilo" S'porean thought actually also quite cheap, S'pore selling S$75 per kilo, OK buy la, since so cheap. When all 3 tourists met together to compare their tea prices, S'porean was the worst!! Who told him so Gei-Bo telling boss he's S'porean, boss was already happy smiling, so 自作自受!!
10 & 9
Many S'poreans even Malaysians will chose Shenzhen, Zhuhai, Xiamen and Shanghai as bases rather than Guangzhou, Chongqing and Beijing. But think the trend will change and many our people behind time. Shenzhen, Zhuhai, Xiamen and Hainan as special regions of economies created by Deng Xiao Ping as he used these bases to attract investments. Shenzhen by far the most successful attracted HK, Zhuhai only recently just boom due to casinos expansion in Macau, Xiamen had been attractive to Taiwanese before, but Hainan is to attract South-east asian investments has not been successful. But Taiwanese whom used to invest in Xiamen later divert to Shanghai. Today is Shanghai, Beijing, Guangzhou and Chongqing as the main powerhouses as they are the traditional bases since Min-guo era and even late Ching Dynasty. Shanghai is successful as chief exporter, chief banking and finance, chief trading city in China. As the largest city in China, it is well famous and more attractive to foreigners and everyone knows Shanghai. Now Shanghai is the most high tech as they are investing in high tech parks to develop microchips and semi-conductors. Part of reasons S'pore and Taiwan lost competitiveness in semiconductors due to uprising of Shanghai. And is able to expand investments into the whole "Greater Shanghai" or Chang-San-Jiao 长三角 include the Jiangsu and Zhejiang Delta regions, and Shanghai is handling exports as far as Wuhan. Beijing is successful as more the centre of north region than just national capital. Become high tech with expansion of Zhong-guan-cun 中关村 high tech park. As Shanghai is top exporter port, Beijing is the busiest airport handling air cargo inside and out of country. Become an important base to invest the north-east, Tianjin and north-west region. Now it serves as the culture base, advertising and media production use Beijing as the chief base in China as well as Asian region. Last lesson I touched on Shanghai and Beijing, this lesson on Chongqing and Guangzhou and other upcoming sub-bases. Together Shanghai, Chongqing and Guangzhou are the 3 main economic powerhouses in China, in these 3 mega-cities (over 15 million population) you can find everything, example in construction, materials, supplies, books, magazines, technical equipment, hardware almost everything as they are the 3 main export powerhouses, everything surrounding the 3 mega-cities are exported to the world from these 3 places. So to make your base in the 3 mega-cities and expand outwards to neighbouring regions is the better choice. You can never make S'pore your choice as is too far away and not economic advisable to do this. Chongqing is also the "Shanghai of the West" as is similar to Shanghai very prospering, I nicknamed the "Chicago of China" as everywhere there are skyscrapers, along the banks of rivers. Chongqing is the largest municipal (直辖市) in China ruled by its own, but the CBD is the 3rd largest city in China. My first impression of Chongqing when I arrived very grand. The construction engineering never before seen in my life: Tall bridges some as high as ten stories, buildings like apartments can be built over steep slopes with footings also a few stories high, then under the footings got LRT light train tracks running. I don't think RSP or any structural engineers in S'pore can design someting like that. The city is sitting over slopes as flat ground may be only 10% of whole CBD, thus making traveling around very difficult. My taxi is either going uphill or downhill, can feel very headache in the taxi. The CBD is sub-divided into many districts, and each district itself is another city-centre booming with shopping and food streets.
You can see the gigantic spending power of Chongqing people. Each district city-centre got its own cafes, restaurants and fast-food similar to other districts, also its own unique landscape features. Very amazing in 2005 when I arrived, Chongqing already got their own hybrid (water generated into the hydrogen gas) taxi as they have more than 100,000 taxis and to feed them with petrol is too big a task. Thus hybrid engines are much better as only feed on water, and they have water-stations for taxis. But hybrid taxis can only travel up to 45km/h if very steep uphill, normal speed can travel up to 90km/h. Chongqing is also like Beijing an important radio and TV centre, with many TV stations, even CCTV got half the stations here to cut cost. Guangzhou in the south is the fourth largest city in China, but the chief main exporter in the south. Guangzhou by area is not very big, but their ambitions are very big. Their 10 year plan to combine all the neighbouring cities to form a Zhu-San-Jiao 珠三角 region so that to link up all cities, also the triangular cooperative region to link up HK and Macau with high speed expressways. Further Guangzhou wants to be the "Lao-Da" of the South so is the centre of 9+2 cooperative regions (9 provinces: Guangdong, Guangxi, Hainan, Fujian, Guizhou, Yunnan, Sichuan, Hunan, Jiangxi, and HK and Macau, known as CEPA) Also very amazing when I arrived in Guangzhou last year their MRT is much better than ours but very crowded. It will host the Asian Games in 2010. Whenever I transit in Guangzhou, I will shop bookstore as have most and best books in the South. China Southern Airline based in Guangzhou is the largest airline in China and they are now owning Beijing Airport as well. Upcoming sub-bases: Dalian, Tianjin, Shenyang in the north and north-east; Chengdu 成都 and Xian 西安 in the west and north-west; Kunming 昆明 in south-west; Wuhan 武汉 and Changsha 长沙 in the centre region; Qingdao 青岛, Nanjing 南京, Hangzhou 杭州 in the east, and Xiamen 厦门, Huizhou 惠州, Zhongshan 中山, and Foshan 佛山 in the south.
12 & 11
There was a feedback that I should cover how to manage China business internally such as how to keep two to four account books, such things I suggest you learn somewhere by yourself. I wish to say this is always how most S'poreans manage a business, they will start from internally, making the shop decor looks nicer, books in order and goods plenty but who is their target customers they don't care, can their goods be sold in a short time and be replaced they don't care, how to sustain their business, whether to do marketing and promotion they don't care. Then wait business not so good, "lei-long-lei-long" offers discounts to get rid of all the stocks and finally end the business. That is why I always heard people open and close business, same as in China, then they say the grapes are sour although to many the grapes still sweet. Even a lucrative business can become a rotten business, why I mentioned that we always treat gold as black gold to throw away. In my lessons I wish to point out our mistakes we have experienced in China and how to rectify, then in future we will be able to do better. Why most HK, Taiwanese and ang moh have done so well yet many S'poreans say China is a rotten place?? Actually there are good examples of S'poreans who have done well, and I will use their examples later on to explain my lessons. Before I want to start my first lesson in business strategies, suddenly I saw opposite my eyes on the bookshelf is a book "Qi-Zhao-Miao-Fa 奇招妙法: The Chinese Business Strategies" by a Taiwanese. When I opened up is full of ancient methods of business methods. Here I briefly start, and only used a few useful ones. He said the traditional Chinese formula in business: Speed, Surprise, Novelty, Packaging, Quality, Resourcefulness, Flexibility, Reputation, Benefit, Goodwill. Think this is very basic, good enough to use in anywhere if you find Sun Zi Bing Fa 孙子兵法 a little over your standards. Speed: He told a story of a rice merchant who wished to grow rice and sell. He stock piled a lot of rice, then came hot summer seasons, people do not wish to eat rice but porridge, so his rice could not sell well. But he heard from a friend that another province lacks rice due to hot seasons and there could not grow rice facing drought. Immediately he gathered his horse carts and transported his rice to sell in that province and thus make a fortune. It was speed of judgment based on good information and network that saved his business or else he may have to throw his rice away and ended his business. I remembered a few S'poreans failed their business in China as they were unaware what really happening in China. Business ventures take time to develop and finally you could sell your products after all the set-up and production. Say a business takes more than a year to develop, but S'poreans will think "风调雨顺" everything will be OK once he's ready to sell. Then something was already happening and he's unaware but still busy doing his business. When production completed and he could not sell. China market is a very fluctuating market, up and down faster than S'pore, as demands very big thus able to push sales up very fast, but something happening will go all the way down also very fast. To have an information network is very essential and how you react to these events is also very crucial. I suggest you have two assistants or partners to work together with you, one to operate internally and feedback to your the daily operation, the other just to collect any external information and prepare an analysis report to discuss with you, while you working on the sales and collect payment. All China small business are using the threepartner system to survive, no such thing as one-man show or even two-man, the other man will
be dead off working. Just now my friend was saying why three-partner in China as Chinese likes "three" or San, San Zu Ding Tian 三足鼎天 (Three legs to support sky) Wu San Bu Cheng Yi Ti 无三不成一体 (Without three can't form an organization) True, earlier years of China Communist Party was Mao Ze Dong 毛泽东 as Chairman, Zhu De 朱德 and Zhou En-lai 周恩来 as Vice-chairmans to lead the revolution in Yan-an 延安. You must have three-partners the minimum, even you have more, always there is a centre core of three main partners to discuss sensitive matters. Especially S'pore company must have three-partners, one is able to fly back S'pore, two still remain in China. Only one person cannot decide matters even talking on the phone can be difficult, not effective way. Next Surprise: here quote Sun Zi 孙子 said "Armies fight in confrontation. The winner fights by surprise and such tactician is versatile or flexible as Heaven and Earth movements, and as inexhaustible, keep going as a great Yellow River 黄河." Regard to this formula, I think what it means to be innovative by surprise in business term. Business has ups and downs, also it can earn fortune in a limited period, then dies down and may be it will come back again depends on our strategies. I cite an example in real estate. Although many know real estate is 10-year cycle or even 11 or 12 years but the last 2 years signal the end or peak. If we don't launch our projects by surprise and plan our sales and production time, likely business will suffer. Usually real estate developers in China will start market research, planning and design as market goes quiet and prices dropping. To a real businessman recession, as long as not depression, is normal and even greater chance to develop the next projects. This will take 2 years but to the China developers is a good time to play golf and engage in events with officials to get the best contacts and information. Usually the minimum period of property price recession in China is 2 years, and as I said is enough time for them to research, plan, design and work on submissions. When prices have dropped enough and begin to react and rise, is the time to market the products and engage in promotion. The maximum period for a condo to be completed is two years so when prices begin to rise, they will call for tender once approval granted to build. By the start of third year, usually Chinese New Year season is a hot property sales period, they will launch so advertisments and marketing to be finished in two months the max from the Christmas of 2nd year of construction (near TOP Temporary Occupation Permit inspection) to before Chinese New Year must all get ready or will be too late. So the buyers will come in gradually, and if they invest earlier, they will have at least 7 to 8 years to make a bigger fortune to sell. In 2001, the condo unit for 100 sq.m completed was selling at only 4000-5000 RMB per sq. m in Shenzhen, by 2007, the same unit has risen to at least 40,000 RMB ten times in a matter of 7 years. If your property product launch late, say only by 2003 you begin to plan and design, sure you must hurry up to finish design and get submission approvals. By 2004 you must start to build also must hurry up in less than 2 years, so by late 2006 you are able to launch, then how will
buyers benefit from your property value??? By late 2006 unit in Shenzhen is already selling at about 30,000 RMB per sq.m. as during your time of construction prices in materials and labour already very expensive. Then the buyer has only got less than one year to sell unless they got their property cert in time, and some never got the cert when prices began to fall by late 2007. Then many buyers got stuck in recession and lost alot of money. Same as in S'pore, now many uncompleted condos get stuck in falling prices and whether they can sell well is very difficult question to answer. So business must be in order and plan well ahead, and react according to the right time. I always say property and construction business must be faster, see how China build and how we build. They complete in 2 years and we need 3-4 years, how will buyers benefit in their investments??? And also S'poreans scare Chinese copying our products and modified. This thought was derived from two factors. Either the S'porean also copied from elsewhere and have made a handsome profit, scare people also benefit or they have orginally designed the products in a long time, and don't wish to go on further researching into a new product, just sit on the old success. I wish to say these two types of thoughts are negative and not suitable to invest in China. If you scare people copying, then you are not innovative and productive. I don't believe that even you don't go to China, other people Malaysian, Indonesian, Vietnamese and Indian won't copy your products. Everyone will copy. We must have this attitude: even people are copying, we will come out with newer and better products. So many world entrepreneurs have done that. Microsoft products are copied worldwide, but they keep coming out with new products. BMW cars are copied by many brands but they also come out with many series and new cars. I always feel a person innovating mind will be always young and a lazy and just sit on old success mind will decay. Designers need to be always innovative. Innovation is today's term for surprise in business.
14 & 13 Packaging the third formula I wish to share, it can be marketing and promotion, or even advertising. Nowadays all business no matter how small, even free-lancer, must work on
promotion or no business. In the past you can open a small shop in the busy street or in a busy shopping centre, when customer by-pass, you will introduce your products and sell. Not so simple nowadays. Also the investments you put into advertising and promotion, in external packaging, can get much more profit than the product itself. Services and tourism today are spending more money into memberships, advertising, promotion and packaging and get much more compared to the money they invested in. Let say money invest into all the MAPP as mentioned above is $100 per unit, what you get back in profit $200 per unit as your product may be only $50 per unit in production cost. Although you are selling at $350-400 per unit, you have already earned $200 in profit or more. Why?? Customers are always attracted to something extra, feeling is extra, value is extra and quality is extra. I also don't mind paying more to things looks good, thinks value and quality is good. So why bigger shopping centre is growing bigger while the small grocery shop is always suffering??? MAPP is the answer. S'poreans have many advantage products and services but some don't know how to make them better, as they feel MAPP is not important. I repeat again MAPP as memberships or customer participation, Advertising can be online marketing, Promotion can be marketing strategies and Packaging can be design renovation and product atmosphere development. Long ago while my Dad and I having Teochew porridge with dishes at one Geylang shop, we already wandering how to make Teochew porridge into like McDonalds and explore ways to realize the ambition. At that time our mentality is a little better than MAPP but not enough, so we gave up this idea. But later when I worked in China, already Taiwanese successfully made a fortune in turning Taiwan porridge similar to Teochew porridge style into fast food restaurant, its called Blue & White 蓝与白 or BNW may be the owner drivers BMW. It was exactly what we had in mind before but we don't know how. BNW is the same concept as fast food but modified. You queue to order like Yong He Da Wang 永和大王 another Chinese chain, then you get a ticket and a number sign to sit. The cooks will prepare your order, you can still walk to counter to select other deserts, but have to tick on the same ticket. After you finished you pay at the counter. Same as Teochew or Taiwan porridge you can order up to 50 dishes, even there's breakfast and night snacks. I have always seen many things in China but not the same as in S'pore. Teochew porridge is still the same business style as in 1960s and 70s, only may be a little better with nice seats and better renovation. But compared in China is really a great difference. The same thing we can sell only $1 or 5 RMB but can be 6 or 7 RMB in China considering China is still lower cost than S'pore. As BNW their style is fast food but better than outside stalls so they can charge higher to get better profits but their costs are lower. Many our businesses have failed to see the true benefits of MAPP and think spending in MAPP costly and will not get good profits but lose in business. They always think to cut cost in everything is the way of business. Of course to cut cost in recession is essential but when opportunity arises, should be time to grow and expand, to cut cost is damaging your business. Not only you can't compete, you also can't expand. We have a lot more to learn in business.
One S'porean, actually Malaysia born, thought otherwise. He was also Lim used to open a fried chicken stall in coffeeshop. He got the successful recipe from Malaysia Johor chef but can't success in S'pore. Then friend merchant in China told him to start in Guangzhou. At first he was reluctant, he thought China already got Kentucky or KFC, how compete?? But his friend told him that there's many ways to do business in China, no need to follow same as KFC, you can be public oriented business but change the format. So he joint ventured with a few friends in Guangzhou and they started Do & Me (多美丽) and today Do & Me is spreading 16 provinces in China, and Mr Lim was rich enough to host a dinner in Guangzhou for our PM Lee Hsien Loong. Do & Me found a gap in KFC market, that is KFC is charging 20-25 RMB per set but not many is able to afford, though KFC is also making fortunes. Do & Me is charging at 15-20 RMB per big set, even got 7 RMB for kid meals, 11-13 RMB for smaller sets. KFC used traditional fast food restaurant renovation. Do & Me is decorating into a cafe but still looks like fast food restaurant. You can see difference between KFC and Do & Me. Also Do & Me is selling S'pore curry chicken rice and chicken rice sets with Chinese tonic soups. I always must go to dinner earlier or else by 6.30 pm all curry chicken rice sets sold out. That is why I don't believe S'pore businessmen can fail so miserable in China and often say China is a rotten place for business. If Do & Me and others can succeed, why can't us??? From beginning of lessons, I always stress is ourselves failing our business and we can't always blame the Chinese. We must improve and innovate, then S'pore flag will fly higher in China. Business strategies can keep say and go on without stopping, you can use Sun Zi Bing Fa 孙子兵 法, Tao Zhu Gong 陶朱公, MBA format, all sorts of methods in ancient and modern terms, but I wish you can start to take up any books to read and learn to improve yourself. I don't want to waste too much time in strategies, and leave from other topics which may be essential to you too. I want to use two lessons on how to recognize our advantages and fully make use these in China, so our potential can stretch up to 50 years or more. In all business development stages, in every nation, are divided into 5 main stages. First primary production and export oriented (working as sub-contractors to provide cheaper things for export), second corporatized stage (becoming main-contractors to produce but outsource to other subcons, still export oriented), third stage development (becoming expensive to produce and promoted to be developers for external expansion, import is cheaper than export), fourth stage services and product development (providing services essential to assist other's development) and fifth final stage wealth development and sustainment (develop in wealth-related industry and how to maintain the wealth). S'pore is beginning now into the last and final stage of nationhood. There is still opportunity in the fourth stage but depend onto our local market is not enough to expand business, so we must go overseas to venture. The casino, IR, developing deluxe class condos and upper class mechandizes and events these are in the last stage. The last stage will need much more investment money into MAPP. S'porean business can never be in the 1st to 3rd stages of development as costs are too high to sustain. That is why I always heard from sub-cons now even in good times hard to sustain their businesses. Of course you need cost to be much lower yet you are earning peanuts, how to survive??? Any delay in payment you will incurr huge debts. Main-con is also suffering as need to tighten their budget to survive. Developers can still survive but they must develop cheaper cost
products but market to be better pricing to sell. Services and product developers as in high-tech product developers can still propser in local market but a small percentage to expand overseas. Only wealth related industries can continue to prosper and expand in the local market, but some are also expanding overseas, more of attracting attention to our local market, more like marketing. Likewise as in China most companies are also in the middle of the third stage, going to develop into the fourth and fifth stages but not so fast. They are becoming developers and expand to other parts of China and overseas. Thus to produce own products are getting expensive and not so worth to produce, better to import in cheaper. We must recognize where we are and what sort of business to invest into China. So many of our S'porean companies who had failed into China now as they cannot find a cheaper place to continue operations. They went to China as in the past S'pore's getting expensive to operate and they moved to China around ten years ago as China was still very cheap then, considering end of 1st stage beginning into the 2nd stage. Now Chinese did not even wish to be main-con, surely to produce by its own finding no purpose and is underway to switch from production into a local spending economy. Now is the best time for hotels and services in education, medical, cleaning, etc. They want to spend in order to get things done, not like in the past buy from outside but still prepare things by their own. They want to import better products, not just basics. Now the upper class Chinese enjoying Thai rice instead buying their own. So Thai rice not enough, Myanmar rice is also among the best. If you still thinking go back China to be sub-con, main-con or developer, your investments in the long run will surely fail miserable. Now should be the time to develop services and develop products rather than to produce. If you want to sustain your business for 50 years to come, then is better investing into the last stage expensive mechandizing for the upper classes, as well as for lower classes but more public oriented. I give an example of what's expensive mechandizing for lower classes. There are Chinese developers going into design of fashion clothes and accessories for the general public, so the public at lower ends can buy these clothes and feel they are still among upper class. But these clothes are manufactured in Vietnam or even Taiwan as labour costs cheaper. Another good local example is OSIM, as they produce their health equipment in Taiwan and elsewhere but sell to China. OSIM is a big and very successful brand in China. My vision of building a hotel also falls in the fourth stage but mine is an unique South east asian style hotel. But I also wish to design expensive bungalows and selling mechandizes for the upper and middle classes which are in the fifth stage. I used this example to show you how you can develop lucrative business in China. I hope to get interested investors as my partners. Still there are business in the 1st to 3rd stages which are still profitable but still related to the fourth and fifth stages, I shall explain in next lesson.
16 & 15 After consideration I would need two more lessons to cover this essential part of how to make use S'pore advantages. Never mind of those failures by S'poreans in the past, just as someone told me "他们不是做生意的料" they are not with business mind. What are S'pore advantages?? I can divide into 3 types: Solid background, SME spirit, Wide network. Solid background: We have very good fundamentals, not the best in every fields but a mix of good points that make us very competitive in the world, even China. We are one of the chief financial centres in the world, in terms of your appearance in marketing will stands out even you are blur in financial figures. We are the largest port and one of chief trading centres, soon to be one of chief tourist centres, in terms of selling your product in services and tourist events, these factors will stand out. Just as we have good background, we can get foreign talent easily and we can provide them with training easily. We have almost every products in the world, thus plenty of expertise and experience in these products, such as education, medical, financial, construction, real estate (mainly in urban), and one of the plus point: we have standards, control and management knowledge. Some of us even are bilingual strong, fluent in both English and Mandarin or Pu tong hua 普通话. Language is one of our strongest fundamentals, I shall cover in next series. SME spirit: Most of our companies are SME employing a few hundred people or less, in China is considered small businesses. In term of corporate strength we cannot compete with Japan, Korea, China and even Taiwan. But the world today changes, as SME is the chief focus. Now they are also downsizing and split into many branches under umbrella. SME is much easier to control and can expand further. China modern entrepreneurs are going after SME and many are outsourcing their products. There are too many examples, one of them I know their success story is Wahaha. I will share in later series. Wide network: We and HK are the best two centres in Asia to do business as we have both wide network with the world. In the terms of resourcefulness (随机应变) we can shift our resources easily than Japan, Korea and Taiwan. For example if China is on the downturn, any company in S'pore, even manpower, can be shifted very quickly to another country be it Vietnam, Thailand, Malaysia or even Taiwan or India. Because our relations with neighbouring nations are closely knitted, even within China we have many relations in the north, east, south and west. For
Japanese, Koreans and Taiwanese are too attached to one place that they will find great difficulty to move around. That is why base on these strong fundamentals we are very strong in China. But what we are lacking in good business strategies to compete in foreign lands and recognition of the various cultures and habits in foreign lands. That is why we are always on the losing side compared with Taiwan, HK, Korea and Japan. If these countries and S'pore compete for tender in a real estate project, S'porean will win as in the example of Brothers Holdings in Liaoning (Koh Brothers Development) Chinese still have great faith in us that we can work on the projects and complete successfully with quality. But is always up to us to take up the challenge. We ourselves are the greatest enemy to defeat our business, and not Chinese and foreigners, bear this in mind always in China business. (还没排阵，就先投降！) One of the strategies I think S'poreans must change very quickly is how we are looking at ourselves comparing with other countries. This is very important in doing regional business as I always ask this question to many S'poreans. Of course they don't know how answer and even answer not well enough. How do you place S'pore in the world ranking in terms of quality, resourcefulness, management, integrity, etc.??? I often got from S'poreans that we are still below Europeans especially British, and in Asia below Japan and Korea, even Taiwan. Then what they mean is we can be only chief leader in South east asia. But want to tell you that this feeling is very negative, very very negative indeed, you have destroyed your reputation and image in China. You look down on yourself as S'poreans but in fact we are among the league of elites in China, I want to tell you this. When I been in China for the first time, I also had this negative feeling in me but Chinese are looking at us with smiles like got Gold (in Cantonese, Zap Da Bo, 拾到宝 got treasures) When Chinese heard one guest from S'pore is coming, big and small all come out to welcome and they are happy to see S'poreans. Bosses and officials so happy that they open banquets to treat us. Thus when you market your products and services, you must market it higher, prices in the range of world elites. When China bosses see your products, even the prices are so high, they give their thumbs up "Very good product, world best, I can tell you all this my feeling that I have truly come to recognize S'pore product is very good". But what most S'poreans, especially S'pore bosses, feel "No la, where got good?? S'pore how can compare with British and Japan???" China people immediately asked "Ha??? No good??? I thought S'pore is better than British and Japan, how can no good???" S'porean again said "Really no good, I be honest with you, you want good products should get the British, German or Japanese better" Chinese then said "Like this ha.....OK then we will look for them, but I still have faith in you." Even get through the deals, S'poerans always scare business will be lost to competitors, thus quote quite lowly. Example, the market price for a service is $1 million, if Italians and Spanish will quote $1.2 to 1.5 million, Japanese will quote $1.1 to 1.3 million, S'poreans will quote $800,000 even $650,000 to get business deal because we look down ourselves and do not wish to compete with the rest. Then Chinese think "Like this I better get S'pore one, so cheap, cheap yet world class" but another instance Chinese thought "Don't know is S'pore products a fake??? May be buy from India and sell to us" Chinese also scare they are cheated by S'poreans.
(My father said this type of negative feeling comes from us as we still thought we are Colonies of British and Japanese, so when meet these people, we kow-tow 叩头 to them, still today S'poreans think going to London and Tokyo like go into heaven. S'pore is also heaven, don't you recognize?? Even Chinese also migrated here, shows S'pore is heaven!!) I want to ask these S'porean bosses why you so Kia-su??? Kia-su until your world class reputation you also don't want, you just scare you cannot get the deal in time and wish to lower prices that people also lose faith in us. WHY??????????? By right if we can get the $1 million deal, your staff will have holidays and dinners, but we have to work like shiit. It is S'porean bosses that "Bu Zheng Qi" 不争气 always "malu" S'pore in China. Thus I always say this it is always WE ourselves greatest enemy to destroy our business in China. This type of negative attitude must really change or S'pore future in China is lost.
18 & 17 Someone asks me this question: "Will world inflation affect China?? What will China do?? When will China property sector recover??" I will cover all these in a few lessons and very interesting to answer, is a very good way to understand China from its present situations. But we have to dig from the past. We must know what is China overall plan and target in nationhood?? Our S'pore PM Lee also mentioned about nationhood, how to build a nation?? But China nationhood is to build "XiaoKang". This concept was discovered by Deng Xiao Ping 邓小平 in Confucius 孔夫子 teaching. Why did he wish to use something in the past?? Confucius said Xiaokang (Chinese: 小康) is a term that describes a society of modest means, or a society composed of a functional middle-class. It is loosely equivocated to a "basically well-off" society whereby the people are able to live relatively comfortably, albeit ordinarily. But to reach xiao-kang is very hard and at that time of Deng, almost all of China are under poverty and even raise 20% of the people (26 million) not enough to be called xiao-kang. So China needs very quick change in national policies to
implement. They need to find an economic model which can move along the present lines of Communism. In ex-chairman Jiang Ze-Min 江泽民 speech, we can read "About the issue to choose planned 计 划经济 & market 市场经济 economy models, we have discovered there are 3 types: 1) build planned and market models together to form socialist mechandize economic model. 2) build socialist planned model type of market economy. 3) build socialist market economy model. With more than 10 years experience, we have realized to move along the principles of socialist market economy model is the right move." Planned economic model is policies based on effective targets and plans to meet targets. Market economic model is policies based on market sentiments or what common as ups and downs of market, then using some policies to regulate. The communist and capitalist have both planned and market models depending on times. Example, when good times is coming, they will use market models to lure money in for investments, or when bad times come, they will use planned models to stop inflation. Both models are contrasting models so to achieve socialist mechandize economy rather hard, but example of country using this was old USSR under Gobachev but failed as both contrasting models created the rich becomes richer and corrupted, and the poor suffered. Socialist planned model type of market economy is most of socialist countries using now as they controlled tightly on how a market economy moves with socialist polices but not effective to open up the whole country. That is why China chooses socialist market model to implement market policies but at suitable time implement socialist policies to regulate. You must understand until this stage so you can know what is happening in China now. So from 1978 when China opened, they are using more market economic model policies to lure in your money to invest and build their country, so that a portion of people will get richer and form the upper and middle classes, thus to train a group of people know how to use market economic skills and technologies. When they have enough capital, they will increase to use socialist polices to consolidate their wealth and distribute these wealth to the common people, so from lower classes of poverty promote to lower middle class. So when you invest in China, you must follow the trend and not get stuck. Now is the time to consolidate and to build their internal economy. In the past they can tolerate to see all sorts of market economic activities even to have smuggling, illegal practices, prostitutes, cheating and gambling. They know they cannot stop all these bad practices when you open the doors, but to raise the standards of the country and improving living standards with influx of investment money is very crucial or else China will never improve and grow. People will be influenced by such habits. But the main objective is to build the national economy first and to produce China first industrialist group so China can more or less depend on people itself in future. Then enough wealth and capital are established, enough basic skills and technologies in which can compete with the world are collected, enough standards and management controls are build on, they will not close doors, but they will consolidate on this platform to rebuild nation, and this is nationhood and trying to reach Xiao-kang in their first attempt. If they can't, they will open the doors wider and practice market economic model for some time, then they consolidate again the
second time and dash to their target again, and go on and on. This is their game plan: they wish to achieve at least 50% (700 million people) be in upper and middle classes, rest can be in lower middle class, this will be Xiao-kang. At the moment only 25% (350 million) in upper and middle classes, about 10% have just promoted to lower middle, 55% manage to avoid poverty which got enough 3 meals daily, with the rest 10% still in poverty. This is the present China but is already considered very good standard among developing countries, which India has yet to achieve. China in general sense is more cautious than letting the market flows by itself, thus is still generally a planned than market model economy. China's plus point in economy is people and having many people help in their demand. In 1950s when PRC just formed, they were already growing very quickly. But a range of international problems obstruct their stronger growth: Korea War, Break up with USSR in late 50s, Vietnam War, Cultural Revolution 文化大革命, Sino-Vietnam War, Tian-an-men incident, Asian Financial Crisis. Finally from 1998/99 it was during this time China had no other problems that their growth began to take off. But too strong growth in mid2000s finaly created a range of problems that they are tackling now: Too strong production creates high demand in energy, thus destroys environment and increases energy prices. As money comes in by investment and collected through taxation, China is very rich but they don't know how to spend the money well, too much supply in money also creates inflation, thus prices in goods and commodity increases. The income level of common people increases thus they invest in housing and pushes prices up, and there's not enough regulatory on housing prices, thus the sudden surge in housing also influences materials price and manpower salary increase. Everything was increasing created a huge bubble in economy. If not from 2005 China started a series of macroeconomical regulatory measures (Hong-guan-tiao-kong) today China will be like Vietnam with inflation as high as 30%, but currently China inflation is only around 9%. What China now is doing in these main steps: 1) Maintain growth by annual figure above 10% but not more than 14%, this is a cool type of growth, enough to maintain foresight of reaching Xiao-kang in sight but slower (Formerly they aim to reach Xiao-kang by 2020, but in fact now they forecast beyond 2050), in this way they won't create a big bubble. 2) Stablilize energy consumption with a few main steps: Increase spending import energy, explore new energy in other sources in hydro-power, wind power, etc, explore new areas of crude oil, restrict energy consumption and increases electricity price (now many people and offices turn off air-con in cooler climate such as 25 degree celsius and below) urge the people to explore ways to use energy lesser and gives incentives to research in greener energies and industries. Develop more own oil refineries. 3) Restrict housing price with a series of measures, thus private property prices dropping. But in turn they increase public housing development (Jing-ji-shi-yong-fang 经济适用房: public sales housing, lian-zu-fang 廉租房: very cheap public rental housing) so many lower classes afford to buy housing. Restrict material prices increase but not so much success as fuel increases price. 4) Encourage and develop rural areas so farmers can be richer, prevent too many people move in urban areas from rural areas. Now a rural farmer lowest pay is even higher than urban worker
lowest pay, thus also creates very cheap urban worker shortage in supply. 5) Maintain stock and commodity market with a series of measures. As foreign funding drops last year as lose confidence in China, but China government increases confidence by injecting their own funding companies by giving incentives to local funding companies start-ups. Now China is beginning to be better, foreign fund managers return but see pool of China own fund managers competing with them. 6) Also allow more people to work overseas to help some relief job-loss pressures and to encourage investments of companies in overseas so to bring in more foreign money and to expand China growth outwards. 7) To shift from an export economy to spending economy, China is now more willing to help in global finance and economy, thus they are more willing to loan money to help in world economic recovery. This will increase foreign spending and stablilize local growth and prices. They are more willing to buy foreign products instead of developing their own, such as buying spare parts in rockets from Russia than develop their own. China locally is helping its own medical, educational, technological and industrial fields to improve their standards, thus promoting the lower classes of industries to upgrade. The measures above will take a few years before we can see the least effects. In the next lesson I will explain how these measures will assist in China private property revival.
20 & 19 There were responses on how I tackle China property revival issues in lessons 19 and 20. This is first lesson I will attach graph and some pictures. Before lesson, feedback with two interesting questions. One, what if we help the West, since they are in financial turmoil, they know Asia will rise up and take over, the West will use this chance to attack Asia by force. My answer: Can't be, since they are in financial turnmoil, they have no more money to wage a war to another country. Two, say after we learn the lessons is to be more China than the Chinese. My answer: I objected, we have our advantages, what I shared with you, is to increase your capability and enhance your advantages in China, so you will be better than anyone including foreigners and Chinese. Back to lesson, attached a graph of supply and demand of China property, in chart A is to define the concept, when the demand is at the highest, is when the supply the lowest. An example now
our HDB no more new units zero, but demand for HDB flats is highest, so our HDB decides to build more flats to cater to the demand. It is also this time the price is rocketing, resale flats are selling at 400k for 4 rooms, >500k for 5 rooms. In chart B, use the chart in China property market is same, when prices reach 40,000 RMB per sq.m was when no new units in market, short of supply (ACTUALLY China developers kept all the new units up to "false" push the prices up, now China government has punished them, so prices keep dropping down. False trading is not accountable in normal market situations.) In chart C, if the trend continues on, without false trading, the prices and supply go up and down again, will reach back to a market "NEUTRAL POINT", this is the average market's price as when supply meets demand, at this point on starting to get no more units in hand so demand will goes up, prices are recovered, most developers will be asked to build more but actually some developers have "insider" info that market is going to recover and China government will signal them to get ready, then they will start to plan and design new units before prices even reach the neutral point. I guess this point is somewhere the end of next year or early 2010. At least half a year before this point, some developers will start to plan and design new condo and apartments. This means by mid 2009 or 2nd half 2009 will see activity boiling up in the design offices, then they will need more designers and engineers. Why I can guess so accurate?? Do I have "insider info"?? The fact is property prices will drop only at an average of 2 years, same as in China, may be 2 years more due to recent World financial crisis. But China recovers earlier, affected by internal and external factors. External factors, after money pumped in to save markets, slowly world is recovering but in China affected very little as they don't much relations with sub-prime. Internal factors the demand for housing is still very big in China, and just when stock markets in China about to pick up, developers will start to build. Also China government will make adjustments to developers coming soon for them to restart, this time with some new plans and controls. In next lesson I will explain what may be likely the new plans and changes that will shape China economic and social supremacy in the world in future. China is actually very happy World in money turnmoil as this is their one chance in 100 years to catch up faster with the West. "One chance in 100 years" 百年机遇, as China PM Wen Jiabao said this is the best chance for China to catch up with the West, in terms of technologies, housing lifestyle and economy. The World in 10 or more years time will see China not just a stronger developing nation, but actually more powerful than the West. If you miss this superhighway train, not I never tell you, you will be very regret in your old age. Before lesson 20, I have to explain what the whole China market situations recently in the graph so you can better understand the China economic polices and trends, here I explain back to lesson 18 where I stop. As I explained, China is trying to go greener, saves energies, building and opening up the rural areas so farmers can catch up, and building up the local spending economy replaces the more export economy. My feeling is they are going after "New Green Urbanism". I quoted a few examples what had happened in China to explain. The Beijing Olympics was
targetted after green olympics, scientific olympics and humanistic olympics. China Beijing set these targets as they want experiment how an urban city can re-generate itself into a more greener, automated and caring the humans type of city from a dusty, less mobile and less care to humans type of city. The successes achieved is enormous well received by both Olympics Council and the World. Of course there are still many improvements to be made in future. Recently China has started two green cities project in Tianjin with S'pore and Shanghai ChongMing ĺ´‡ć˜Ž Island with UK. More are planning on the way with Germany, even HK and the USA and Japan are also interested in developing their own versions of greener cities in China. Why China is so fast to develop greener cities than the rest?? Oil prices pressure forced China re-think to act faster or China will face oil-strikes and with people revolts, the China government and police cannot control such situations and will collapse. The answer is developing greener cities can help to resolve many problems, fuel shortage, housing and employment demands, promote rural areas social status, and even can help China to scale faster and higher than the West. In actual fact the World Economic Forum had discussed the future of money is to be invested into rural areas and develop greener technologies will have the best money returns. In short S'pore will not benefit in this transition as we do not have land to develop farms, may be above HDB flats??? But the West cannot develop this green concept faster as politics kept in their ways, and they have to resolve other problems. USA is even worse as fighting in the war and now the sub-prime issues. But China is opposite, they don't have sub-prime, and demand for the housing, employment, fuel is even higher, and they still have the bigger goal of reaching Xiao-kang, to have 50% middle classes and the rest able to overcome poverty. All these external and internal factors gave China "Bai-nian-ji-yu" to catch up with the West. They are the happiest people right now on earth. The green cities will follow after western concepts but with integration with rural areas so that the farmers can also benefit from this transition. This will liften up farmers status and help to resolve employment issues in the cities, also helps to resolve environmental issue which I forgot to mention in lesson 18, actually the world and UN have pressed China to resolve this big headache of environment. Actually all along China has been developing New Urbanism where they have more larger green spaces inside cities. New Green Urbanism is improving as adopting more greener technologies into previous New Urbanism concept. The West and Japan are developing in China as they use China with higher demands for this concept as experimental grounds to develop their own in future. But this gives China a better chance and faster to catch up with the rest. The housing market in China in future is going after Green Urbanism concepts to answer all your questions on how China is resolving inflations, how to revive housing and what will China do in the next step.
22 & 21 This will be last lesson to explain China new direction to develop real estate and housing. In fact now there's a slight surge in prices in China real estate, as developers are clearing stocks at lowest prices, also there's an uncertainty in China future housing directions how government will implement new housing plans?? Will there be Shang-pin-fang 商品房(commercial mechandize housing)?? Many uncertainties encouraged people to invest the remains of the shang-pin-fang stocks. In fact China government is determined to develop "Socialist New Farm Plan" 社会主义新农村. Why called "New Farm" and not "New Urban/Rural"?? Actually the new plans you have seen in my last email with Teochew Swatow or Shantou city new farm plan pictures are consisted of both urban and rural areas, but still called "New Farm". The objective is to develop and upgrade farms so that the farmers lifestyle will be nearer to urban dwellers. This was first thought out by Deng Xiao-ping as he visited cowboy farms in USA in late 1970s. The Cowboy was living same as urban suburbs type of housing with water refinery and wind mills to generate electricity (now solar panels) but they were still farmers growing big apples and fine grapes. Deng was very impressed. All along China is trying to develop such farms but only in some areas with success. But most farms are still in jeaopardy and main reasons are lacking of funds and what these farms going to take in future directions?? So slowly they developing, first by upgrading farming technologies and science, irrigation, now upgrading their equipments and education so that they not only grow, but can manage their own businesses and even do marketing and accounting. Once they can manage on their own in business, their lifestyle will be better, then the government will even reduce the taxes so that they can grow a few times more. This is to pull up the farmers average pay to as near as the lower-middle income earners in the cities. The average lower-middle income earners pay per month in China cities is 2,000 to 3,000 RMB (2005 estimates, now could be 3,000 to 4,000 RMB per month) so this is what government is upgrading the farmers to this level, so as to overcome
the poverty problem first, then CCP China Communist Party can rely on farmers to rule forever. In fact many farmers are now receiving average 4,000 RMB per month income and they live like small kings in the villages driving pick-up lorries (3-wheel mini lorries) to send vegetables and fruits to the urban markets to sell. The idea of the New Farm is getting the rural areas development as near as the cities, so they also have amenities like market, schools, community centres, shops, cinema, banks and they can build their own three-storey bungalows besides their farming lands. Even saw a farmer built a bungalow five-storey high with lift, inside like a classical palace, better to live in S'pore. Then the government next step is to move the urban nearer to the rural, making the cities greener than before, so they can also have farms but smaller ones to grow fruits and vege for education, hobbies and small supplies, surely most supplies still come from rurals. To do this way is also making the urbans greener and environment better to live in without the smokes and dust. Shenzhen and Nanjing are underway to transform their environment with greener parks and smaller farms in the middle of the parks. Thus Shenzhen was awarded United Nations Habitat Award in 2004 or 5? And Nanjing was awarded the same this year. If this trend continues, China will be much better than other countries including the West, as urban cities become greener and rural areas have become richer. China will slowly be World No.1 nation and thus reached their target Xiao-kang, 50% upper and middle classes and 25% lowermiddle classes, the rest 25% can manage three meals per day easily. The life in China will be very SHIOK. Got people asked me were these lessons I learnt in MBA course in China business?? I've never learn MBA before, is thru study of books and news, now always learn new knowledge in Internet, also thru conversations with many people especially people in business and China affairs that I got these conclusions to share with you. Better than you learn in MBA course, as many S'porean professors even not been to China before and even they gone but do not know much how to handle the Chinese well. The recent World Recession or Depression (not certain) occurs and most interesting is Iceland where they have declared bankrupt. Once fishermen now they are living in very rich lifestyles, now must urge by their PM to return as fishermen, as they burnt their savings all into fund investments. Don't laugh at them too much, S'pore may be like them as our FDI Foreign Direct Investments 53% are into overseas financial and insurance products. Not bankrupt but may be half poorer if overseas financial investments go down into big drain. But on the other hand, China is the only important financial nation not affected very much by the recent crisis and is even very rich in foreign reserves, No.1 in the world, estimated more than 10,000 billion US dollars in reserves. Now the EU and America is asking China to help them in bailout plan. China is undergoing a huge transform from export economy to local spending economy with emphasis to redevelop and upgrade the farms. China needs all the money they need to overcome financial crisis coming into China and helps their plan in New Farm succeeds. In all events we see, shows us one thing that fortune can go up and down all in an instant. This lesson I wish to use Buddhism to explain how can nations and even ourselves able to transform
even in business. Refer to my attached colourful picture, in any nation or anyone, fortune is granted by the will of time, place and people in your surroundings. It is affected by the collection of causes known as Karma in Buddhism, what we have done and collected in the past lives and even past time in this life that later you able get harvest. Change is anvoidable and very sudden as shown in the lightning and darker clouds in picture. But the result is very fruitful and get full of corns field. As you know, corn can be refined into oil and even petrol, thus is wealth. The fortune of nations such as Iceland is just like from a corns field, putting too many into one basket, then without caution, all go down into big drain, what they have is a land full of sand that is dry desert. The fortune of China is just like from desert of problems they have been through, now they are getting full harvest. It's all depending on the will of time, place and people. How time have given these two nations period to adjust their fortunes, place to make full use (either to grow crops and catch fishes, or to enjoy in bungalows) and people surrounding them to give them opportunities to develop. It all depends on ourselves in the past how we think about our life down the road, any planning or just wander from place to place, time to time??? In my next lesson I will discuss how the world economy now is very dangerous and how it will affect S'pore, even smaller than Iceland in terms of land. But on the other hand we got China and how we can make full use, may be in the lesson 24. I warn you we may have to work overseas by 2010 or even in 2009, our bosses cannot stand the crisis if they drags themselves into crisis by 2010. What the government forecast now is we may overcome by 2010, but who knows, we may have to suffer for longer time than the previous 90s crisis.
24 & 23 How will the world financial crisis affect Singapore?? The government said not very much is trying to calm our hearts, considering of two factors, scare we lose confidence and try to pull out money from markets too fast (as you know we are more kia-si than others) and two to three years later will be the General Elections, like Malaysia over night, may be in S'pore four to five GRC going oppositions way. But PM Lee said may be not one year but we must prepare for two years. He and his government are actually not so sure. My own perceptions, the different of this crisis different from 1997/98 crisis that the last one not so affected us, as most of our usual money investments is in China, America and Europe, started off in Malaysia and Thailand, then Indonesia, these nearby nations had lesser effect on us, of course still had, and we were able to recover in 10 months. This time the crisis started off in America, then Europe turned bad too, we will be more affected this time than the previous. We will have to recover in more than 10 months, my estimates at least 16-18 months, about two years, from now October to 2010 Chinese New Year and perhaps after CNY holidays in 1 to 2 months time. This will be harder for S'poreans businesses to take on, the government must help our enterprises or else all to close down towards end of 2009. Recent American banks have started to help the bailout plan, and European governments also put in a very big amount to help the markets, will this resolve the issues?? Problem and factor are relying on America, how they will rescue the markets and rebuild economy. May be Europe can manage to be saved, but not America. It all depends on how Obama or McCain performs to revive American economy. But financial crisis waves are like tsunami or earthquake, first started in America, Europe is 2nd to get affected as Iceland is squeezed in-between, who will be the next country or even region. It may be Asia, as many countries put their money into America and Europe not just S'pore alone. I think it could be Japan as the effect is greater in terms of money and investments. Already Japan is starting to show a crack in their markets. If Japan is showing fallout, then Korea and China will also be affected, so will India as Japan invests a lot into India. If the northern part of Asia bad, think by end of this year or early next year will affect South East Asia very soon. So we will receive the worst around the turn of new year 2009. If the tsunami wave is to arrive here, the most badly hit will be financial sector, then our manufacturing, construction, property and services will be badly hit following after. Now I worry is not Lehman Brothers, it an issue of the past already happened months back but I worry for wealthy S'poreans who are going to go broke. Most smart people will either will pull out their investments and shift their money away from S'pore. Lesser smart people will not pay for their coming instalments like cars and property they have already booked. This will affect jobs and companies will have to axe staff and cut cost. Axing staff is best way to maintain temporary survival in account books. Your annual leaves will be shortened and bonus much less. If not happy, please resign as the boss is also happy if you do so. By next year I and many others will be out of jobs earlier than expected. I thought I will be out
of in 2010 as the casino IRs finish and most of condos construction have also finished but due to the financial crisis, I have to estimate this to be a year earlier. It will be very difficult for S'pore to shift their investments money from America and Europe to elsewhere, all region will be affected very soon. Now is just to see your money washed down into the big drain, and try to save as much as you can to prevent money from you flowing out more. It will be very bad mistake if now you plan to buy property or a car, as the road down is very uncertain, your investments may either eat up your most precious cash or even enterprises can close and run away with their money, allowing your property there without further care. Do not think S'porean bosses will not "Zao-luo" run away. Very bad conditions is better and will prompt them to escape than die altogether. Now is best try to secure your job with great care, but is also very hard, and do not spend money like drinking water, you will be dead exhausted by next year. In next lesson I will explain why there's a big opportunity in China which you can seek in although China financial markets will be affected by America and Japan. Wise men will take this opportunity so as to shift your focus from a dry desert to a harvest field, refer to my picture in last lesson. In this lesson, we share about GDP growths and property growths in estimates, that may be true or false, all depends on the future events unfolding and how world economy reacts. If the crisis worsens, let say both S'pore and China went down together in GDP growth, it will be China recovers first by end of 2009 as effects of sub-prime and American financial crisis have fewer effects on China. S'pore affected by America and Europe may either go down further or recover slightly later by early 2010. Using the supply and demand graph I showed you in earlier lesson, the supply of S'pore units will continue to rise as construction is still growing healthier. It may be by casino IR finishes construction that number of general property units will begin to fall, as most of the condos have finished construction by then. Architects and designers may be from early 2009 begin to have lesser projects to design. As submission takes a longer time here in S'pore, the toll on construction to dive takes effect sometime later. China on the other hand property growth is still dropping, prices may drop to rock bottom by end of 2009 before begin to recover. Before the rock bottom, design for newer projects will begin to recover. When China is beginning to grow faster by early 2010, property and construction sector will be in full steam. By 2011 China property growth may surpass the growth in S'pore. Looking ahead on our future in the property and construction sector, if you want to remain in this line, the outlook for S'pore property is still bleak even financial markets recovers or not. Toward end of 2009, if you still wish work in commercial and residential construction, is best to plan ahead for your future. Unless you are OK to work anywhere and any place, to stay in S'pore is still OK if you can work in government public projects after 2011. If you still prefer to work in commerical and private residential, best to shift your focus to China. Designer and architect should start find job in China from 2009 onwards, while specialists in construction can start to search from 2010.
China property has a lot of room for growth and improvement. The New Farm projects will provide many jobs for construction sector. Both rurals and urbans need upgrading, farmers need new housing, factories and warehouses, urbanists still need public housing, and the wealthy people needs better and greener condos and townhouses. New towns in the farm will be needed, urban planning and design got many projects to design. The demand for property is always limitless in China, as only around 20% since PRC formed in 1949 has so far got a chance to change their living environment in their lifetime. Most of the people are still living in very old homes and they want to buy or rent newer homes, of course most want to buy than rent.
26 & 25 That day our Indian Finance Minister was questioned by media how to solve our problems in Singapore facing the crisis. He said we have no resources only industries (actually the factories) so what we can do is to adjust the value of our dollar. Actually the poor thing of our S'pore we got nothing but only the dollar and economy to readjust, which is of course very dangerous as we are a small nation in the large bowl of soup, anything happens we are dead. You may ask why China wants to develop the farms at this time, why farms?? Is it stupid to redevelop farms than develop more factories?? We received comments from LKY and even PM Lee that India should develop their cities to catch up with China. But India now is also following after China to develop the farms and new energies, but why follow China and not follow S'pore??? Why farms and not cities?? You know, value of agricultural products though very cheap, can jump many times higher if their potential was greatly discovered and developed. Why a vegetable only a few dollars a kilo can have such great value??? Modern science has found vegetables like corns, palm, spinage, sugar cane now seaweeds etc can produce pertol for cars. Not only that, fruits and vegetables in organic form is much faster to grow and taste much better. The seasons increase from example 2 to 3 seasons per year, to 4 to 5 seasons, thus can export much more. Now be agricultural kings in the region and even the world is much more worthwhile than industrial or money king. Now vegetable and fruit can be made into organic medicine and many value-added products such as materials for manufacturing into fashion. Also this time is the best time, after China and India have earned money in manufacturing and
finance, they should start to develop their poorest population in the farmers. If they do not start to develop their potential, the income gap will be widen, and very soon revolutions in both nations will start and overthrow the whole systems. Also if farmers are greatly taken care of, their purchasing power will increase a few times. China 60% can even be 50% or 100% better purchasing power than the urbanists. Do not forget farms can be developed into resorts and tourists spots, now the folk farm culture is very hot, even companies organize holidays for staff to live in such villages and taste life of farmers. Even Microsoft China organizes holidays for staff in fish farms to catch fishes and learn how to use the water mills to draw up water. This tourist income will increase farmer income by many times. They even can produce products such as textile and souvenirs to be sold in nearby markets. Do not listen to our experts, China and India not stupid to develop farms and leave aside their cities. They will develop their cities but must develop the farms first. Back to China, if average farmer now earning 600 RMB per month and has to enter a city to find a job in construction, can return home to learn growing sugar cane or banana which now sell high price, his income can grow 5 times to 3,000 RMB then he can forsake idea no need to be construction worker. With 5 times income, he can live his better life to buy TV, washing machine and computer in a year's time. If he can develop tourism, as some income jumps 10 times or even more, even to 10,000 RMB per month, they can even buy 3-wheel truck or even 4-wheel drive car. Not only that, government can collect taxes from them, such taxes also increase over the years, even though their taxes have been lowered for farmers to be relieved of the tax burden. Now the Central government underway to initiate new laws and ways to help the farmers, also to rebuild homes for Sichuan earthquake victims, in addtional building cheap homes for rurals and urbanists. Very soon in 10 years time, their people average lifestyle is better than our people in 3 to 4 room HDB flats. You will surprised to see in future some of your tourists from China used to be poor farmers who want to travel to S'pore as a construction worker but never, instead develop their land to grow crops and strike fortunes to make the tour to Singapore, Malaysia and Thailand (Xin, ma, tai) and you will wonder how in last few years they can be much richer, and yet our people still live in 3 to 4 room HDB flats still poorer. Yesterday heard from someone saying China developers are pumping money in property market again, at first I thought they are over-nervous or over-excited, but according to the Guangzhou Southern News 18 cities government have given notice to developers to start their projects. So it is true China property market is on the rise again, sooner than we've expected. I may want to resign now anytime to end of the year, but I still keep a closer watch but I will start prepare my design portfolio and apply jobs in China in meantime. A few weeks before next Chinese New Year if continues to be hot market, then I will resign surely this time immediately after Chinese New Year. In China time will never by our side. Why I so excited to work in China than S'pore??? Many reasons I have told before, can get richer than just a simple monthly pay, can enjoy more although work hard also more, ladies more sexy, matured and open-minded, no need to do a lot of unnecessary paper work (I find S'poreans really a lot of free time used in busy working on unnecessary paper and forms which in actual
fact can be much simplified, that is why S'poreans use 3 years to build a condo, China uses 1 year if rushes around the clock to complete.) The recent surge in property development because China wants to retain its capital and funds within China. Although China promised to help the world to stabilize the funds, but what they mean to stabilize own market first. They will try as much as possible prevent funds flowing off the country, then they will develop the internal market first by New Farm projects, later opens up the whole spending market including the property market boast consumers confidence that China is still stronger, so no need to migrate overseas, China central government has over 20 top experts in finance and economy keep watching daily world markets and giving the government updated analysis. Out of them, I know the 3 very top which the President relies on most: Minister of Finance, People's Bank Chief and National Development Consultative Council Chief. Think must be their ideas to advise the government now is the time to open up the property market. Encourage you to work or do business in China now, because now is the best time to experience China (China is now more modern than before, so lesser hazzard than what I experienced a few years back) and to contribute to the well being of China, you be greatly rewarded as all the people will appreciate your experiences and help, giving warm smiles and making friendships, not like here in S'pore, the people take things for granted, even you did something how small, they think this is what you should do and should not return with smiles or appreciation. They even say "What have you done, like that only ma, I also know how to do, but I just don't do, push it to you to do.“ (理所当然) Such an attitude how to compare with work experiences in China??? If we don't go now or in next two years, down the road you no need to go, ten years later we don't have to be invited to China, they already know how to do and you will miss your chance if you are half-hearted. But I'm determined to go there, as I know it is the best in the world to work and enjoy. If market continues to be good for years, I will continue to work there as long as I like.
29 & 28 & 27 Still got people got wrong that after 26 lessons I have given that I am asking you to work for S'porean bosses in China. If you still think like this, then you will not experience the whole exposures I have told you in the past 26 lessons, very minimal will happen like this. As S'porean bosses are very restrictive and even more KIASU in China than here, they are scare their staff messing around in China, then their whole plan messes up. So they guard you like their gate guarding dogs and expect you to be at your highest alert. Also they will scold you even more than in S'pore, even one small mistake you commit. Why I know?? I first worked for S'pore construction company in Shenzhen only short while but I distasted the job, so I resigned. Later I joined my first China boss design office today I still got very good memories in that company. Today I wish to give you comparison of the two bosses in China - the S'porean and the Chinese, which is better, up to you. Of course you choose S'porean bosses as the money is much much better, I know you will choose who, but you must consider the long run down the road. But nowadays China bosses are willing to pay the same or little better than what you got now here. But also remember what you got in S'pore will spend a lot expenses and save much less, estimate myself in the past I saved up in China 5 times more than what I save now in S'pore, as very expensive to live here. That is why I can be richer in China just by saving up my pay, let alone other business goodies I got in China. General Manners In China 1) S'porean even Malaysian bosses always like to scold many types of Hokkien vulgar words and always called themselves "Nin-bei" your father, they always wish you to treat them as your fathers. In China they will scold more of these vulgar languages than usual on their staff as they are "buai-zai" not steady and off balance. Although some have been in China many years,
everyday and everywhere can be new lesson to learn and think how to decide, so S'porean bosses "si-bei-buai-zai" very not steady, and they become nervous and always ask "why like that, why like that....ha???" So the staff will become even more "si-bei-buai-zai" more not steady than your bosses. You feel like you're living and working in a China hell. I have come across S'poreans told me how they distaste the work in China probably what I told you here. 2) China bosses on the other hand are all the opposites as I told you in the above point. I found they are the best bosses I have ever worked before, still better than my present one in S'pore. Of course in terms of pay they are not the best, but in terms of treatments and leaderships, they are the best. They will not scold any vulgar languages as most China bosses at this level in design offices are university graduates, and they are very cultured people. They read and drink tea in their own office. They welcome you to sit in their offices and drink tea then have a conversation with them, even you can discuss world politics and philosophy with them, they do not mind and can share their own. You will find they have very high aim in their lives, they know what they want in life, they are the ones working towards big goal. (干大事) Treatments 1) S'porean bosses in China always very secretive, like hiding many things from you, from their faces can tell. When you suggest a way or ask a question just to help them, they'll become very disturbed by you, and said "You don't know one..this is not S'pore but China, just be quiet and do your work. Others I can care." Then they still think very hard and feel very uneasy in their faces (si-bei-buai-zai) They always treat you like stupid staff, like you don't know everything and how to handle, must ask them and must prepare to be scolded heavily by them. I feel they are so inexperienced in China, must as well don't invest in and can save their headaches. That was why I remembered my ex-boss said they will do two projects in China and withdraw totally out of China, they thought China is really a hell. 2) China bosses will not and surely won't scold you, why scold you??? They needed you to help them earn money, why scold you??? They even praised you what you have done. Not just on foreign staff, they do the same on their local staff. Someone who had done a good piece of digital artwork, my ex-boss will go up and praise him "啊哟，很美啊！这小子还不简单，这效果图 好，很好" I translated as "Ah yo.....very beautiful!!! this little guy still not simple.....this digital artwork good, very good." At once the staff was embarassed and will be very happy in heart, and they will be faithful to boss. Almost all the bosses in China know this style as they learnt from Mao Ze Dong in books. Mao army was at war, he went to inspect his soldiers, comforted his injured soldiers "同志们你们辛苦了" "Comrades you are working very hard" Soldiers very happy but said "我们不辛苦，死跟毛主席一起打战" "We are OK, we will follow Mao to fight the war" "很 好，你们好好干啊！" "Very good, you work harder" Then Mao went to the kitchen, smelled something very nice "啊呀，这菜十分香啊，是你做的吗？" The cook said "是的，特地为毛主席做 的" "Yes, the food is specially for Mao" I conclude that China bosses won't scold staff but will praise you. I will explain more comparisons in next few lessons. Taxes 1) As S'porean companies are foreign owned, they have to pay higher taxes after some years, especially income taxes. The average taxes of S'pore executives in China have to pay between 20 to 35% percent of your monthly income, depending on your pay scale. All also depends how much you report at Tax Office. Of course S'porean owned companies will be honest, report the same figure you are contracted with your companies. Of course you can discuss with your company to have two employment contracts, one in S'pore and the other in China, your company
will only report that part of income in China to be taxed. But also depends on how company arrangements in their investments in China. In all the situations, very hard for foreign companies to escape tax or report lower for tax cuts. 2) While China bosses you can only have two contracts but also can discuss to have your contract stated income to have a much lower figure to report, but must be reasonable to convince the Tax Office. Usually big bosses in China have "good relations" with officers in the tax office, they can help you to pay much lower taxes. Another way is asking bosses for a nett salary, after tax salary, to calculate from how much you will pay for tax, from the figure down to get your nett pay. Example, in normal circumstances, suppose you want a nett pay 25,000 RMB per month ($5200, 4.8 RMB = S$1, they won't give you 4.6 current rate) if tax above the pay 25,000 RMB is 30% (on a 25,000-40,000 RMB scale), so your actual pay is 35,714 RMB. You must write 35,715 RMB in contract, then they deduct tax accordingly to 30% tax, and you will get 25,000 RMB. Of course after negotiations with your boss, he will help you to report only 10,000 RMB per month in another contract to report income tax. So you got 2 contracts, one you are paid 25,000 RMB nett without tax, and the other 10,000 RMB for taxation purpose. Base on under 10,000 RMB scale you are taxed only 12%, that is 1,200 RMB per month. So base on your pay, your actual pay plus taxes is 26,200 RMB, which you are now taxed 1,200 RMB than 10,714 RMB per month!! This is one good thing to work for China bosses which you are taxed lower. As they were also have to pay a fee to government to employ foreigners, same as our foreign workers levy, that fee is also based on how much you report for income tax, the higher tax you to pay, they have to pay higher fees. You help yourselves in tax also help your boss to pay lower fee, understand??? There are tax calculators in Internet which can help you in tax and salary calculations in China. Accomodation 1) To work for foreign company is very hard to get cheaper accommodation if the company does not provide. The company will provide hostel with company staff, but tell you those you got no freedom at all, you have to follow company hostel rules which will affect your work performance appriasal and bonus as well, like living in an army camp. Only higher posts they will provide high class condo, lower posts they expect you to share with other staff, not fun at all. If your bedroom untidy, they will deduct points and affect your bonus. I rather rent apartment unit my own, but you can't get cheaper, as property agents will ask where you are working, as you need to fill the rental agreement. Then they see company is a foreign one, oh OK...., sure use a big axe to chop you for higher rental prices so can share with the unit owner. Even the owner hears you are a foreign company staff will sure ask for higher rent, market price 2,000 RMB will say 3,000 RMB. Once in a life time, now don't axe you will regret for the whole life. 2) While you are working with local boss, property agents and owner will think your pay is not that high, so they will base on market rates to rent an apartment unit out. As they are also scare you complain to your local boss that rent is too high, that they will be caught by police, so they are willing to offer you even discounts. I always ask for discounts, if not then I will ask for more things, like washing machine, microwave oven and beddings as not usually provided. Try to suck out more from these hungry and greedy owners. If you are a foreign company staff, you won't have a chance to suck them out. In two occasions when I worked in Shenzhen and Sanya, I lived in very good apartments at very good rental prices.
Reputation 1) While you work for S'pore bosses in China, of course you as part of the S'pore team is at your highest risk. People told me better work for S'porean companies as safer, but also heard a saying "the safest place is at the most dangerous place, while the dangerous one is also the one you think is safest." I can tell you base on my experiences working for the China bosses is the safest, while working for S'porean bosses is the most dangerous one. Why?? Chinese think you in that foreign team is coming to China to compete with them, trying to eat up their money, and doing more harm than good. They will be at their highest caution and will at highest alert to guard you. They will also try their very best to eat you and chop you with the World No.1 biggest axe. Now don't chop you, when will chop you?? They will give you very high quotation for everything so you answer your bosses, then they will be suspicious of you, is it you join forces with the Chinese to eat up your bosses??? Not only you lose trust of your bosses, but you are like luncheon meat
in the sandwiches don't know what to do next??? 2) While working for China bosses, your risk facing the Chinese is at your very least. As you are helping the well being of China and Chinese people, they will welcome you with both hands, all smiles and appreciation come towards you, you like a hero in the crowd. Sexy women will come to you. Everyday you are in happiness. If your company facing a S'pore company in competition, of course your boss will show off you to S'porean bosses and you can see hatred faces on S'poreans looking at you, "S'pore traitor why work for a China boss???" So who won competition?? Of course my China company as they got me S'pore expert as well as hardworking Chinese behind the scene. S'pore company will have lesser manpower as every Chinese developer knows it, unless Surbana, CPG, Archurban and JGP, they know how many staff these S'poreans companies have in China. If you want a business in China, you must be big enough to get or sorry, better not invest in China, wasting your time. After worked in China company my excolleagues and ex-bosses today still my good friends and still help me sometimes. Is so different from working in S'porean company, where ex-colleagues and ex-bosses may have spread rumours about you when you left, "See how bad his English grammar?? Can't write a proper letter" or "Last time Edward like that also do not know how to do, still want to teach us??? Go and teach China people la.....Think he is so good." You can see how different working in S'pore and China companies, as I got more forever friends in China than here. Think this is also crucial why S'poreans lost more talent than to retain them, so now no choice, have to get foreign talent to work here. Knowledge & learning 1) As said before previously in other emails, working here in S'pore you learn only system skills, such as how to lay a quality marble floor, and not individual skills such as design softwares, as S'porean bosses do not require you to learn too much, as long as you gain knowledge to work for them in a team. Your self-improvement is not important to them. What they want is you work for them like slaves, until one stage no more in use, one leg kick you are off. When you left your job, you are actually nothing and worthless, unless you return to new company with the same system to restart your worth and be made use by another S'pore boss. When you retire, you may have gathered a lot of savings, but no improvement in actual learning, your skills cannot be used to start another business or to work for a new field. That's why I now find no meaning in paperwork I do in company here, will not help in my future jobs or even be a boss myself. 2) Working for China bosses you are always learning new things, and they also wish you can keep on upgrading yourself, in all areas. For me in design, they wish I can know how to use new softwares, new knowledge in world designs and construction methods, they are willing to teach you too. In my short span of two over years working in China, I learnt urban design, interior design, landscape design, furniture design, product design and can use China autocad TianZheng, Photoshop and Sketch-up, a bit of 3ds max, also I learn how to do business in China, and China business strategies. All these knowledge is good for my future, better than merely know how to lay a quality marble floor, a system skill.
32 & 31 & 30 Colleagues Personal Manners Next I want to compare the colleagues in China and here in Singapore. I still find those in China better than here. Surely here got a few good ones. But they are either foreign talent or Malaysian. S'porean may be one or two. The main reason why I find colleagues here so bad is they using the "civil servants mentality" to work. What is the chief characteristics of civil servant?? To push away responsibility, push here and push there, as long as own self no need to do and carry the burden, is actually a very selfish attitude. In China also has this civil servant mentality either from civil servants or ex-civil servants now working in the private companies. Generally in China most colleagues are very helpful and friendly, as they are taught by Mao Ze Dong, must be honest and help others the best they can. Thus they got the "Lei Feng Spirit" 雷锋精神. Lei Feng 雷锋 is a comrade in Cultural Revolution always tell stories to kids and help any youth come across him. If you help many people in China you are called a Lei Feng there. That is also one very good reason I like to work in China. Speed China people can work faster than people here, actually much faster than foreign talent in Southeast Asia. Just think in this way. If Singapore reaches its past peak in 1995 since independence in 1965, we use 30 years but China uses half 15 years, from 1990 to 2005. Thus you can count how fast Chinese work. If our foreign talent work speed is 1 week 7 days including weekends, so Chinese will finish the same piece of work in 3 to 4 days. The reason I find our foreign talents have many bad habits. After work 2 hours, want to smoke or drink coffee, then chit-chat at the pantry for half hour "hahaha" laugh away very happy. Before restart back still want to chat with neighbour for 15 minutes. Once overtime they feel tired and the speed slows down. Chinese don't work like that. Once they have committed an assignment, they will work 4 hours til lunch no tea break. Smoke?? While working on computer desktop, they smoke and drink tea at same time, and they will fill in large jar of tea can drink for a few hours. Once overtime their speed is even faster as they are also humans, wish to sleep to get enough energy the next day. Usually overtime they are very concentrating and will not likely to chit-chat, and don't wish to chat in
overtime work. Creativity Here I find many people work without creativity, either push to their team leaders or to the bosses to think for them. Thus there are many meetings and discussions to order people get to work and follow instructions. Thus the centralization power is very great at the core, and this is also why S'pore bosses will always think their staff are stupid, thus the "just be quiet and do your work" is very common here. Usually staff have very little saying power. I feel this way if we don't ask questions to resolve, our work is even more error prone and is going to waste much more time to finish task. Chinese do not like meetings, just tell them what to do, they will follow, but once meeting, they are very serious. You must give them enough time to ask questions to resolve all matters. Usually the meeting starts with short brief as all instructions have already written down in a short note to everyone, short brief lasts only half hour, surely by hierachy to give the more powerful to speak and ask first, then Q&A very strong atmosphere and everyone fight to ask. The end will be concluded by the boss or leader to round up, then everyone sets off to work at once. In the meeting you can see many staff have many very good creativity and they are not scare to raise up and share with the leaders and bosses. But here S'pore always "push, push, push, and push again" "No la....not like that one...(then ask) but how to do??......anyone got any idea or not?? (meaning own don't wish to share, waiting for stupid people to come up with ideas) ...No ah?? then HOW??....this matter must be resolved ma....HOW?? Come on, you guys, don't like that lei...(then someone volunteers to speak, but he is not giving his idea) "Like that ma...think everyone go back and think what should be done, then tomorrow can discuss about it." Like that even one small matter takes one week, even weeks to be resolved as everyone kiasu do not wish to carry the blame for giving an idea which may fail at last. Very selfish. Civil servants mentalityIn last lesson I talked about "civil servants mentality" how they always wish to push away responsibility. Although in China also got this bad attitude, still they are better than ours here, that is they will commit to share responsibility once everything is confirmed with a written record. But here still not at all after written record, our civil servants still push away to private sectors to hold the burden. Why different in two places??? In China they treat all people as same Chinese, as Chinese must share equal responsibility to protect and build their country. But here civil servants do not wish to share responsibility and even benefits with outsiders, they don't have a mentality that actually all are Singaporeans, all are equal but you are what you are, and I am what I am, we are very different. Like to ask, where is our so called Nationhood??? May be I will "hood" you!!! How we progress as a nation??? Kiasu and kiasi mentality This two I most hate to see in my work place. Every form or letter must accompany by many sheets of paper, on every paper must clearly marked out where is the problem, then issue with a formal letter or transmittal. Even in the letter, document or transmittal, can't have a single mistake, even spelling. Even letter A and B is sharing the same number of attachments must again photocopy the whole set of attachments once again. Very kiasu and kiasi, like will go to
court later. In China if there is any attachments in same 2 letters they will at each letter highlighted attachment code numbers to indicate these papers are to be attached, thus no need to photocopy and photocopy until photocopier is out of order. It is not they are lazy but is smarter and faster working this way. In meetings do not wish to share ideas, very kiasu and kiasi, think later others will sue or accuse them mistakes. Even signing a delivery order to indicate receival of goods, then will ask all around place "Got order these things of not?? Ha??" The problem is whoever orders the goods must not order by himself alone, even orders by himself, he must think the goods will arrive at main office, thus he should inform the office main counter what he orders and roughly when the goods will arrive. Then the main counter staff can take note. This is a matter of a system. Then if no one orders the goods, how?? The delivery man will be angry and how to report to his company??? This is also a matter of our people working manners. China all offices are very standard, they sure got department for in and out delivery, not just at main office but at every level of team. Thus each level will coordinate with the main office department. You can't order goods yourself but must go to your level department. You will be informed when the goods arrive and must auto pick up from department. They will not serve you. Paperless work Same as 2nd half of 3rd topic in last lesson, China people don't like to work too much on paper, although architects still use butter paper to sketch in front of clients. But now in China clients wish to see more digital forms than on paper. They find more realistic and practical than on paper with colours. S'poreans mentality is that digital forms can be fakes thus must print out to prove the works are genuine, but now prints are also from digital, so what is the difference??? Waste paper, waste time and also waste money. In China they wish to see more 3-D and now more animation, the results matter most, not the process of showing 2-D in plans, sections and elevations. Only when they are not so sure and to confirm your works base on 3-D and animation, they will like to see in 2-D and even in perspective forms. To save time in so much work, you can copy pictures or effects from your past projects or other people projects with similar effects as your work to show them so that they can compare and judge. In China, besides people working on drawings and on digital effects, also need one person to seek info from the web and copy down to edit and use, this is usually the design director or chief designer. My previous job in Sanya is to lead my design team and also helps in seeking info from the web and re-edit to use. If your architect team represents your development to present work to clients or officials in China, tell them better not present on paper, "Xia-shwei" or "Malu" S'pore, immediately they straight reject your work, "What are these??? Is it cheap work from elsewhere???" What they want is full presentation from 3-D, animation and better present a real model. Every business must spend some money in order to earn much more, cannot kiasu and "kiam-ji-sai" stingy and scare to waste money. S'poreans always got this "kiam-ji-sai" or how to "gan-da-shi" achieve bigger goals??? Praise and criticism Chinese always wish to praise people first in every their encounter with any people, this is their customs. Even they wish to criticize, they will first give praises, try to spot goodness in opponents, then add on their criticism, in this way the negative effect will be lesser. But here in S'pore, we usually don't know how to praise people, but straight away "Ah-ni-ao... like that also want to
show people??? Not feel xiao-li me???" translated "So lousy..... like that can display your work??? Don't you feel ashamed???" or some very rude ones "Lan-jiao la.... like that only ma... what big fuk??? I also can do...... no big deal" Thus always many quarrels and arguments, "you think you very smart.... come la..... do for me la???"
34 & 33 This lesson I'm going back to the comparison of bosses between China and Singapore. I hope you will not follow the examples of S'pore bosses in China, will not get you success. Gan-da-shi, bu-zuo-xiao-shi 干大事，不做小事(Do big business, but not care minor matters) The failure of many S'pore bosses in China that they used too much time caring the mini and minor matters in their company. Whether manpower enough or not and where to find (should be HR matter) whether goods are enough, when must order (should be logistics matter) or whether the team leaders have met datelines (should be department matters) everything they want to care. As a biggest boss your duty is to lead the whole company by setting out goals and make sure all your departments giving out instructions. You care bits and pieces of work only after you received all the reports and feedbacks. But bring out to your department heads in meetings and make sure department heads meet datelines by signing on a commitment record book. This was done by many American and China today even adopted this method. If your department heads don't meet company highest goals and datelines set for them, their "heads" have to roll off or chopped down. Bosses usually don't care how workers work or the process in China. They went to the production line to observe and ask questions, but won't interfere a worker's work and asked "No la..., why you do like that??? This should not be the way.... come la..., I teach you la..... Your leaders don't know how to teach, I will teach you." Like this all your departments heads and team leaders can drink coffee and tea at the canteen, as the biggest bosses wish to teach their workers how to work. Then all the leaders no need to work too hard, just wait to get salary. This type of company will never grow too big, at least not bigger than Taiwan Wang Yong Qing's Tai-suo or Li Ka Shing's Hutchinson Whampoa. Bosses should entrust duties and tasks to department heads and team leaders, if they cannot perform, ask them to resign or sack them, but should also give them at least one chance to perform better.
Da Mu Biao Qian Jin 大目标前进 (Aim and advance towards great goals) Even fighting a war or in business, there is bound to be losses and setbacks, but as long as your goal still in sight or the greater victory can be achieved despite of smaller losses, the top most leaders should not care too much of smaller losses but keep on concentrate on the Da-FangXiang (Biggest Direction) I found many S'porean bosses always losing the sight of expanding their businesses, but instead of minor losses and setbacks, becoming very nervous and withdraw altogether. "Che" said the army general "withdraw". I ask you a question: who will lose more, the army who withdraws or the army advances despite minor losses. Of course the army who withdraws will lose the most. Why Wang Yong Qing and Li Ka Shing can succeed??? They advanced despite of financial crisis and setbacks, and in the end they won and expanded more and more. While those who withdraw will be very hard to start all over again. You must be determined to advance, work or do business in China, despite of setbacks, withdraw to Singapore temporary is OK, but not forever, you must be determined to lose in order to win at last. I'm determined to go back to China. Bu Duan Xue Xi Deng Yu Qian Jin 不断学习等于前进(Keep learning is equal to advancing) Chinese is always learning, no matter bosses or workers, they are learning, even old folks also say they're learning everyday, even Communist Party always shouted "Bu Duan Xue Xi" campaign "Always Keep Learning" Why??? Learning is itself already advancing. While you learn new knowledge, you will use it in work, thus will advance. Many S'poreans don't like to learn, "TaGao-Liao" or already learn enough. When you think you have learnt, but how far can your old knowledge take you??? 50 years?? 40 years?? Base on past, is only 10 years the maximum. You don't believe?? See my old friend in O levels who don't learn to advance, after he did small business, yes he did earn money but slowly he found his business cannot advance as getting competitive, then he has to go for diploma level, even later he found diploma also not enough, must go for bachelor, may be some day he need to go for MBA. How can O levels (junior high school) be enough for 50 years??? Learning not necessary must go after degrees or papers, everyday learning new skills or new ways you are already advancing. Especially for the bosses must keep learning. Surely everyone has shortcomings in business, learning can help bosses to repair those mistakes again. See China leaders and bosses keep learning everyday, compare with S'pore who always say "Ta-Gao-Liao" who will win in the end??? Also coming to a negotiation table or even tender competition in China, who will win the bid??? Kai Xiao Da, Sun Shi Yue Da 开销大，损失越大(Expenditure bigger, lose even bigger) Many S'porean bosses have not earn enough, already spend pretty big in China, SIA First Class, 5-star hotel with ah mat driver from airport to hotel, golf game, shopping and eating bigger like already hungry for 50 years. There are also Taiwanese and HK examples same as ours, but many huge tycoons they save a lot during external assignments. China got many start-up bosses are very stingy in personal expenditures as going for assignments away from their local bases. They will rather live in 3 to 4 star hotels, don't play golf, prefer to take taxi or rent a car at hotel, but they are earning millions at least. Small bosses will even live in 2 star hotels, take a taxi or even bus or MRT train, but in their side wallet bag fills with thousands of RMB. Taiwan Wang Yong Qing saves a lot when go overseas and he always consider carefully what to spend along the way, don't "anyhow" spend money away, even scolded his sons while they spent on nonsense
entertainment. Li Ka Shing's shoes must wear at least for 10 years before asked his wife to buy a new pair of shoes, even at a discount price minimum 70% or below. If his wife bought at 80% off Li was also not very happy but he asked his wife why need to buy such "expensive" shoes??? See how people save in order for his company to expand bigger, why??? If you have a habbit to spend money on yourself, then you will not control your company well so you will lose a lot of money along the way, coming to bad recession, your business is bound to doom. Mao Xian Da Tou Zi, Sun Shi Ye Yue Da 冒险大投资，损失也越大(Risk invest bigger, lose also bigger) S'porean bosses always like to "Hao-Lian" "We are World No.1" "If people invite us, show that people give us face to invest." Actually show us the way to die even faster. S'porean bosses have failed many times in China, but I always see Taiwan and HK bosses getting more successes in the absence of S'poreans in the market, why??? As they are careful not to invest in a place too much, for example, a mayor asked them to invest, to return a face value, OK they will invest in 2 million RMB actually not big to a corporation. Chinese officials will ask "only 2 million??" HK investor smiled off, they are using this small money to test waters, if not good, then don't invest further. But S'poreans very big money loaded, OK la, invest 10 million RMB down, since Chinese officials said their place was so good. In the end business is not that good, "withdraw, withdraw, faster withdraw!!!" Everything is lost in the end. And some will complain China is a lousy place to invest in, next time not invest in China ever again. If lousy, why Taiwan and HK can achieve success??? Why the Westerners, even Middle East Arabs, Indians and Japanese can achieve successes??? Don't tell me they forget to see China as a lousy place to invest in and should follow our S'porean bosses to withdraw altogether.
36 & 35 This is the end of the first part series, I thought I would stop here and never wrote again, but since then decided to continue from lesson 36, still lots more not finish yet. Below was lesson 35. This will be the last lesson in this series of lessons in China business. Hope you can go further from here. The discussion will never end. Success is not to be taught but advance by your own, key is by your courage and determination. No one knows you will be able to achieve success in
the future, be in China or S'pore, as long as you keep on advancing. But please don't laugh at others or jealous of others, no point doing that. Everyone has the potential to be successful, not to laugh at them, if they really achieve success, will you be laughed by them for staying here??? Not jealous of them, once you're jealous, you will not be advancing and will be very unhappy in the end. Success takes a longer road of pains, is actually very painful and have to suffer more in order to reach the final taget you desire. This last lesson I only just want to say one thing, why China is still very good market, for work or for business, despite of so many S'poreans have failed in China??? Taiwan Wang Yong Qing died recently and he got eldest son Wang Wen Yang graduated in UK but due to external love affair he was thrown out of Tai-suo by his father. Wen Yang was used to be the MD for his father group's in India and South East Asia. After thrown off by his father, he saw the great potential must invest into China. So he started Hong Ren in Guangzhou by himself and today Hong Ren like Tai-suo is very big in China. Everyone sees China as a very great potential market in the world, how big the potential?? My estimate is at least 120 years, no boasting and joking, may be more. Recently Hainan has planned their long term development plans even beyond 2050, what's their potential?? 60 years Hainan can be developed into first class Xiao-kang but they hope to achieve it much earlier, this part may be boastful. Believe Hainan got 60 years of potential to develop and they can achieve Xiao-kang by that time. Shanghai is almost near to Xiao-kang, they need another 5-7 years, becoming first place in China to reach Xiao-kang, 50% of people in middle and upper classes by 2015. Just consider China basing on this calculation: 1.4 billion people now, if each can spend 100 RMB per month or pay taxes at same rate, by 2050, Chinese have spent more than 70,000 billion RMB away or pay taxes to government at same rate, how rich is China??? They estimate by 2050 they will have 2.5 billion people, 1.1 billion more people to spend and pay taxes. The need for housing and infrastructures will be very great. -------------------------------------------------------------------------------------Hullo, my friends, I'm back. After stopped at lesson 35, I thought I would not continue to write again on "My Lessons in China Business For Singaporeans", then I went to a bookshop and read some of the new books on China business strategies, really dull and they had not covered enough what I mentioned previously in my lessons. From this lesson have changed topic title to "New Lessons In China Business" for a wider global audience and wish to explore new ways of making money in China. Also someone asked me why I always discussed about business and talked less on Chinese way of life, they wanted to know how Chinese live and behave. Actually I also wish to discuss these interesting topics in previous lessons but no opportunity. I will discuss it in future. In this lesson, wish to elaborate a little more why the world suddenly got stuck in this financial turnmoil while China is lesser affected. I believe the world has gone out of control in the last few years investing in some "empty promise" financial products tied to volatile investment such as real estate and shares. These can be really dangerous if the market is going down. All countries
are financially linked and will cause a turnmoil if not manages them. But China is lesser affected, most of people who invested in such financial markets are mainly in coastal cities of Beijing, Tianjin, Dalian, Qingdao, Shanghai, Xiamen, Shenzhen and Guangzhou. Worst they tied up their cash supposed to buy housing and for savings into the volatile money market. In the end many people lost their investment including their hard-earned savings. But in most parts of China, many did not know exactly what were financial products, even in places they just started to know about insurances, also people who do not put their savings in banks. They would rather save their money in biscuit tins, above the false ceilings, inserted under the roof tiles, inside a hole in the middle of bed mattress, inside the cavity of brick or mud brick wall, under the timber plane floor, and even in the water well. There were many ways to keep money at home but just won't place in the banks. Once a Chinese told me how to destroy their fortune by burning down their homes was the best way, as the cash was all kept in their homes. I was once invited to a business meeting in China to discuss a design scheme with a few wealthy villagers. From appearance you may think they were poor, not at all stylish in urban standards, but they owned a lot of money and assests. Once my ex-boss agreed to their terms, one of the wealthy villager asked us to wait, he climbed up the ladder to their attic (room under the roof.) Later he took out a load of cash wrapped in old cloth and old newspaper, in that package were 300,000 RMB in hard cash, and he handed to my ex-boss, which he later deposited into bank. See how rich were the villagers. Later we were invited to view their plantations acres of land, and dined with them in a timber hut in the middle of their fields. This is actual fact of Chinese who own a lot of money in the outback but unwilling to put their money in banks. They were scare that money will be corrupted or robbed away in banks, so will be safer to put in homes. Thus most Chinese were not affected much by this world-scale financial turnmoil, and they still got lots of hard cash to roll out for worthy investment.
38 & 37 Talking about banks, do you know there's a great difference between banks overseas such as China, Australia, New Zealand, and ours?? In China, Australia and NZ savings account interests earned are deposited monthly, but ours not fair deposited annually. By right should be monthly. Imagine how much our banks earn from our money monthly in 11 months of a year?? Further the interests in China earned are charged more than 1%, while in Australia and NZ charged by more than 2%. Singapore POSB banks could only give you less than 1% interests. Back to last lesson why China wealthy villagers preferred to save money in homes, rather than in banks. Not only savings in banks could be corrupted or robbed away in rural banks, but what the villagers think is to rely on their land value to earn much more than their savings. In 1949 when PRC was formed every villager was rewarded by government 1/4 Mu of land. Each Mu is equal to 667 square meters, so a quarter Mu is 141 square meters of farming land. If the family had four members, then they could get at least 1 Mu or 667 sq.m. In the past they were given free land, now this piece of land 1 Mu can sell for at least 300,000 RMB (S$60,000) In 60 years they earn average extra S$1,000 or 5,000 RMB per year. If the villager earning per month now is only 600 RMB, so per year only gets 7,200 RMB, putting in a bank let say earn 1.5% interest per year is only 360 RMB, about 14 times less than the value of land, which is far more better?? They were not stupid. But there were some stupid farmers who sold their land to get permission to work in Singapore as construction workers. In some years to come, they will regret they have lost something precious to them for many years to come. They will not recover their land back. Over the weekend I noticed China is on its way to begin "Socialist New Farm Program". For the definition of this program, please refer to my past lessons. Many planning for farming estates is
already out on the drawing boards. Since the property sector is down, design offices are now in new life designing for new farm estates. Very soon these estates are on the way into realization. In meantime urban cities are planning for flats for sale and rent like our HDB. In Hainan 4,500 units each for rent and sale are on the way to be built, total 9,000 units of public housing. I will give you some picture examples of China version of "HDB" flats in future. That day our friends went for lunch and we talked about the Teochews in Thailand and China. The Teochews are the 2nd largest Chinese dialect group after Hokkiens in Singapore roughly about 600,000 people. In Thailand is the largest Chinese dialect group estimated more than 3 million, also the largest Teochew group in the world. Many Thai Teochews went back to China to pay respect to their ancestors every year, even one promised to build a Thai Buddhist temple in Shantou City before he died. When we say the Teochews also include people from Shantou City. By right by area Teochew is the largest ethnic group in Guangdong Province, even larger than Hainan Island, thus it could become a province by itself. In the world and in China, Teochews are spread throughout everywhere, is the largest Chinese ethnic group in the world. Recent World Teochew Conference attracted Teochews in more than 90 countries in the world. Why Teochew is so popular?? They have a saying "Di ko liang jiu di ko zuo" translated whenever and wherever the places are cooler then there will be Teochews in those areas. Whenever I saw gate templates written "Si Hai Wei Jia" in Chinatowns in Australia and USA, these templates were installed by Teochews, there is no one fixed home for Teochew, everywhere is home to the Teochews. Also Teochew food is one of the five main dishes in China, the others are Guangdong, Shandong, Sichuan and Suzhou in Jiangsu Province. Teochews really are great cooks, and desert making is one of the artistic feature in the dishes. In Singapore Teochews are the closest dialect group to Mainland China, the other ethnic group Hakka is besides Teochew also closer to China. Hokkiens and Cantonese are further away from China. The reason I think Teochew is closer to China as in the Teochew dialect language contains many Tang Dynasty verses and idioms. A recent China professor in languages researched on the dialect languages in Fujian and Guangdong found Teochew dialect contains verses and idioms in Tang and Sung Dynasties era. In China I noticed many Teochews gathered around in HongKong and Shenzhen. The richiest Chinese in the world Li Ka Shing is typical Teochew and have donated many Bright Hope schools in China. His company Hutchinson Whampoa is even stronger than PSA, Singtel and Temasek combined togther offering also in port management, telecom and investments, and even much more. Even in Hainan Sanya there are around 100,000 Teochews local born in Sanya dealing in small businesses and farming. Usually Teochew can speak own Teochew dialect and many other languages as well. I had a Teochew friend from Malaysia who can speak three Chinese dialects: Teochew, Hokkien and Cantonese; five languages: English, Chinese, Malay, Japanese, Spanish. Whenever there are Teochews they are always dealing with small businesses, fisheries, food and catering services, primary industries most in food processing, and also real estate build housing and Shantou Construction Company is the first in China to be privatized, formerly construction companies are all under the government.
39 Welcome to whole new edition of my lessons. As I had already explained to my past friends, I am in no way a teacher, but just to share my experience, "lesson" means my own lessons gained from my China trips wishing to share with you. That's why it's not an all-round perspective of knowledge what you may find disappointing. If you want an all-round scope of what's happening in China, please buy some books and read up. My views of certain events happening in China is solely from my own experiences. Some may call them "extreme" but were based on my own reasoning and findings. As I said, Chinese were also like me, you should able to imagine what's on the other side of those words. Don't trust anyone's words. But my findings so far written in previous lessons show that Singaporeans have not really used the best ways to explore China. Why I use "explore" and not "settle down"?? When you reach an unknown place, you should first explore and research on that place, before you can make a decision whether it suits you, then you settle down. My findings show that Singaporeans always
never research properly whether that place suits them, but "because there were already many investors here, Taiwanese, Koreans, Japanese, so we assume this should be a good place to invest." What people are doing, we just follow in. Please remember you are not only competing against the Chinese in that investment place, but also Taiwanese, Koreans and Japanese, and also some unknown foreigners. We may be at our losing end as Chinese customers will choose them instead of us. Just like HSK, there's no logic why we should use HSK, but as Taiwanese, Koreans and Japanese using HSK to assess their staff Chinese language standard, so S'pore also follows. But remember Taiwanese using different system from China, also 繁体字 Traditional Chinese. Koreans and Japanese they don't have in place their own standard tests in Chinese, so they using China HSK. S'pore and Malaysia have in place our own Chinese test system way back to early 20th Century but as some English educated "nuts" working inside PSD don't understand this and don't bother to research more. People using HSK, we just follow in. In Singapore you can use this type of "Follow-In-Mentality" but in China you will die very flat, as you don't really understand what you are doing there. That's why many S'poreans I heard doing business in China before, "Withdraw, withdraw, quickly withdraw" or "China is such a lousy place for business" etc. After previous lessons, someone feedback me wishing to learn deeper into each area which I shared. He posed me many questions which I thought very good questions. The first, "What's the difference between so-called "Four Capitals" Beijing, Shanghai, Guangzhou, Chongqing?? In terms of cultural and business environments?? They do have strongholds around (the four) like Shenzhen in proximity to Guangzhou, Shantou should not be too faraway, but Xiamen should be part of the strongholds in Guangdong as well. After rethinking, as this is a very big topic, need to separate into many lessons again, but I know how to answer you. There will be 4 parts: Lesson 39 "History of China business development in general"; Lesson 40 "Three types of strategic management of the West and Chinese: Military, Political and Business"; Lesson 41 "Formation of the Four Capitals"; Lesson 42 "Future plans of China business development". The so-called Four Capitals: Beijing, Shanghai, Guangzhou and Chongqing, were not formed only recently but many hundreds years ago already formed except Shanghai formed in the 19th Century by the West. Beijing with many past names such as Beiping had been the centre of military, political and business centre of China in the north. It used to be the capital of Yuan, Ming and Ching Dynasties, so is very important in China context, also a well known cultural and educational centre. Shanghai was formed by the West in 19th Century. The reason to form this city, as in the 18th and 19th Century China main exports were tea and silk, very expensive in the world, especially in India and more expensive in Europe and America. At first the chief ports to export tea and silk were in Fujian and Zhejiang ports of Quanzhou, Fuzhou, Wenzhou and Daizhou, at that time these ports were very rich. Guangzhou at that time was the main port (much like Shanghai today) to export all sorts of products including tea and silk too. But if you bought tea and silk at Guangzhou, then will be expensive, then you need to buy at the four ports in Fujian and Zhejiang cheaper. Later there were argument and disagreement of trade terms like today's WTO talks between the tea and silk makers with the Western buyers. The sellers wished to raise up the
prices, that angered the Western buyers. So they proposed to look for another place to export tea and silk, that was Shanghai. I will explain Shanghai in next lesson. Chongqing has always been main port along Yangtze River and the western part of China to export rice and other products from the China West to Guangzhou, later also to Shanghai. But if you say the Four Capitals' Modernization in "New China" then only happened in the last 15 years. New China means the period controlled by the Communists. But the Four Capitals had already been modernized before, in Min-Guo era 民国期. China reopened its doors after Cultural Revolution in late 60s and early 70s in 1978, but they did not really know how to redevelop the economy. Hearing advisors, Deng Xiao-Ping proposed to open up five cities to attract foreign investors, actually more Overseas Chinese than foreigners as Westerners scared money will be eaten up in a nation not in the capital system market. So Hainan, Zhuhai, Shenzhen, Shantou and Xiamen opened up for businessmen to enter China. Actually early years thousands of Overseas Chinese used this way to meet relatives inside China at the five cities. Today only Shenzhen is most successful among the five cities which are called 经济特区 as very near to Hong Kong. Zhuhai is near to Macau but most people in Macau are gamblers not investors, they open Casinos and hotels. Hainan is near to South East Asia but very few willing to invest into a deserted place with no basic infrastructures at that time. Shantou at first quite prosperous as many Overseas Teochews invested but soon lacking "fire" as position not so strategic in China, will explain Shantou failure in next lessons. Xiamen too quite prosperous many Taiwanese invested but later they moved over to Shanghai, now considered to be No.2 among the five. As China was seeing success in early years after 1978 among the five special zones, they soon opened up other cities. Reason to open up Shanghai as its main port and largest city in China, huge manpower waiting for jobs in the production lines. Also the Westerners pushed China to start the financial markets and stock exchanges, without these, Westerners will have no confidence to invest their money in. First China started Shenzhen as nearer to HK as the first stock exchange but foreigners were not interested. They felt Shanghai will have more strength in financial power than Shenzhen. Today both cities stock exchanges very important in China economy, and rumours spread Beijing may start its stock exchange. I feel China should have four stock exchanges instead of two, not enough, the fourth should be Chongqing.
40 Before start Lesson 40 on strategic planning of the West and Chinese, wish to describe many years ago when I was in secondary school. My classmates saw me preparing for Geography and History exams in Secondary One and Two levels, they told me no need spend time to prepare those exams, they intended to fail those exams as not as important as English and Maths. Even a classmate told me "Can Geography and History give you lots of money when you work after graduated?? So why waste so much time?? Later you got no time to prepare for Maths and English." But my father taught me even Geography and History not important to our classmates, "I want you to pass or you shall see my bamboo cane as you get home!!" I scored for my Geography No.2 in my class, and credit for my History, even represented my class in school Geography and History Quizz Contests, also did well for my Maths. Need to thank my parents' teachings. Also my classmates said no need to prepare for Chinese exams, as Chinese sure pass the exam, and he was preparing to fail Chinese, as at that time Chinese exam failed could enter NUS and even NTU or NTI, Chinese GCE 'O' and 'AO' levels F9 fail marks also can enter NUS. "Chinese not important one laaa, why you want to score Chinese?? Go to Communist China in future?? Hahaha.....you will suffer in China.....no food and no money for days.....I won't go to that country!! Crazy laaa Edward......go to China for what???"
Have to say before New China, Chinese had no idea in modern business strategies especially business strategic planning. The Westerners had more knowledge in this field, especially the British Empire, why they were able to expand their territory due to careful selection of ports, cities and bases. China was more interested in military and political strategic planning, how to defend against the intruders of the Huns 匈奴 and how to control the population. Beijing and Nanjing were much more important than Guangzhou and Shanghai at that time, where these ports were more for merchants and wealthy people to live. Usually seaports selection was done and planned by merchants and businessmen after the Ming Dynasty, so the Central Governments in Nanjing or Beijing would follow their advice. The officials didn't look at seaports as very important strategic locations in their overall planning. But when Shanghai was formed changed China perspectives of the whole nature of national defence, they started to look into the importance of seaports. Shanghai was formed by the West to break the monopoly of export trade in tea and silk, and Shanghai had greatly hit into the hearts of China government, at that time Ching Dynasty. The Manchus saw need to strengthen the defence along the coastline by building their own modern navy, which they bought warships from Sweden. Shanghai was rented out to British, later to France, so 英租界 and 法租界 later Americans and Japanese also came into become powerful forces. British saw Shanghai was important as it cut into the central part of China using Yangtze River as a sword and major trade route into heartlands of China. That's why Chinese later opened up river ports of Wuhan and Chongqing to connect with Shanghai. As the British came from behind Fujian and Zhejiang to export out tea and silk, those four ports later reduced to lesser importance, sucked away their export business over to Shanghai. So why later many Hokkiens from Fujian became poorer and needed to migrate overseas to Singapore and Malaysia to find jobs. That was how you come to this small island of Singapore, yet you still kow-tow to British which caused your grandfathers great sufferings and troubles to migrate over here. Lucky Guangzhou did not fall into the hands of the British as they lost in the Battle of the Opium Wars or else China would die really flat out. But British and Americans had considerable amount of influence at Guangzhou. Actually to British at that time they wanted Guangzhou more than building a new Shanghai, nearer back home to England. But to safeguard their interests later they forced China to rent out HK to guard the doors of Guangzhou, that's why British merchants founded Hong Kong and Shanghai Banking Corporation HSBC as the banks to finance the two cities, today HQ is in London. But soon they found Shanghai better than Guangzhou. Not only they can cut into China, but they controlled China Eastern Sea and guard against Japan and Korea which was then controlled by Japan. British also cut off trade routes from China Bo-Hai sea 渤海 today Beijing and Tianjin, which they and French later also conquered Tianjin after the war with the Eight Superpowers 八国联军. They knew from the past they needed to guard Japan as Japanese controlled North-East of China and thus had a seaport called Dalian, and also got Korea. Soon Shanghai and also Guangzhou prospered become important centres for trade and commerce, also modern cultural centres. Then even became good political uprising centres for Sun Zhong-Shan 孙中山. So Shanghai and Guangzhou also act as important political and even military centres, during the Min-Guo era had so-called 上海帮 and 广东帮 even today in Communist China, these two still exist as powerful political forces not to be ignored. During Cultural Revolution, Shanghai Bang was very powerful supported Jiang-Qing 江青. Today Jiang
Ze-Min and Xi Jin-Ping can be said originated from Shanghai Bang. Jiang and Xi both were former Shanghai Party Political Secretary 上海市委书记. Vice-premier Li Chang Chun was former Guangdong Province Party Political Secretary 广东省委书记. In terms of military strategic locations, Shanghai and Guangdong were important as two got its own military HQ zones. When Taiwanese airline planes fly over Guangdong and Shanghai, there were radars to monitor planes, missiles to shoot them down.
41 Last night I received revision lessons on Geography from my father in China. The reason for the set up of “Four Capitals” is mainly due to geographical reasons. Mainly China depends very much on the three longest rivers for transportation of agricultural products to the main river ports and seaports of China. The three longest rivers are Yangtze River, Yellow River and Pearl River.
Chongqing is important as a few smaller rivers connected into the Yangtze River at that point. And Chongqing can be a great port than Wuhan further downstream is the banks of Yangtze River at Chongqing are deeper, thus the boats can stop at the banks, whereas Wuhan the banks are filled with lots of silt (river soil) thus the banks are shallower. Another reason why the banks at Wuhan shallower as there’s two main lakes and a few other smaller lakes in Hunan and Jiangxi provinces to suck away water from Yangtze River, thus making river depths at Wuhan shallower. Economically Wuhan can’t compare with Chongqing, although Wuhan is centre of China Central Plain, its surrounding provinces economy are greatly sucked away by the Four Capitals. For info, China State Department approved 西三角经济区 connecting Xian and Chengdu to Chongqing so no Kunming in 2007. Kunming will be responsible for Yunnan ties with the Greater Mekong States cooperative zone in Indo-China. The reason Xian or even Shaanxi province can be connected to Chongqing as nearer and cheaper to transport from Chongqing to Shanghai, rather to Tianjin. Thus now Chongqing is in control of 西北 region as well as 西南 region. At this point if you do not understand China Geography, may be you don’t understand what I have said so far. Beijing with Tianjin port is important at the 环渤海经济区 at the Bohai Sea as Yellow River pours its water into this sea. Unlike other rivers, no one can build a port or city at the delta 三角洲 of Yellow River as frequently flooded. Thus they need to build a bit northwards. 环渤海经济区 is 3+2 concept means 3 provinces: Liaoning, Hebei and Shandong with Beijing and Tianjin, connect the North-East 东北, Hua-Bei 华北 and 齐鲁 which is Shandong around the Bohai Sea region. Guangzhou is important as the whole Pearl River 珠江 region from Guizhou, Guangxi down to Guangdong with the 西江, from Hunan 北江 down to Guangdong, and 东江 from Huizhou to Guangzhou. In total this river network controls five provinces plus Hainan Island from the sea. Now to explain why Shantou 汕头 is greatly neglected in Guangdong province development as not belong to the 珠江 river network. The 潮州 region connects to 汕头 port using 韩江 a separate river from 珠江, thus the development is slower but still important as controls Eastern part of Guangdong. In the Ming Dynasty the 韩江 region was a province by itself. Also explain why Xiamen in Fujian cannot rely on Guangdong as too far off. If Xiamen is to rely on Guangdong then development will be much slower than Shantou, lucky not to be. Xiamen will still depend on the trade and investments from Taiwan. Shanghai is the most important in China, not only connecting the whole stretch of Yangtze River but China sees it as the nearest exporting port to Japan and America. Thus exports from Bohai Sea region and Pearl River Delta region will ship to Shanghai and transit to Japan and America. The volume of export from Shanghai to Japan and America has already surpassed the trade to Europe via the Malacca Strait from Singapore. Thus Singapore and Hong Kong ports ranking keep dropping from World No.1 and No.2 to No.3 and No.4. Shanghai port is now No.1 but its export volume is too big, thus its port facility not enough to use, some of the balance volume goes to Ningbo-Zhoushan 宁波-舟山港 in the south of Shanghai to export out, so Ningbo-Zhoushan is No.2 port surpassing Singapore. My father and I foresee the Jiangsu northern port of Lianyun 连 云港 and southern port Tongzhou 通州港 perhaps will surpass Singapore and HK in the future, once both Shanghai and Ningbo-Zhoushan ports not enough to use, exports to Japan and USA keep increasing ever more, as more Japanese, Korean and American investors keep pouring into
China to build factories. Why your AMD and Seagate have gone to China from Singapore. So also explain why gradually the Five 经济特区 proposed by Deng Xiao-Ping will become less important, especially Shantou and Xiamen. Hainan has already transformed its economy from Special Zone economy to International Tourism Island mainly invest tourism and eco-friendly industries. Shenzhen has transformed into main global financial centre and China main events and exhibition centre. Zhuhai next transformed into a high-tech industrial centre, already allocates a piece of land besides Macau to develop industries. The future of China economy will solely depends on the Four Capitals away from the Special Zones. Singaporeans must be able to see this transformation or will be greatly on the losing end, also explain why Singaporeans fail in China as always gather in Shantou and Xiamen; both have gradually lost in China competition.
42 The future of the Four Capitals will influence such small nations like Singapore and Malaysia. Each of the mega-region will aim to exceed the economy of certain economic power today, such as 珠三角 aims to exceed Korea GDP by 2020 and 长三角 aims to exceed Japan GDP by 2020. So means China will have the size of four or even five or six Korea or Japan sized economies. Also India will be another investment powerhouse supplying exports to Europe and Middle East, will equal to three to four Koreas. Singapore and Malaysia, with Malacca Strait, how to survive being sandwiched between China and India, together only 30 million people, even smaller than Chongqing Municipality?? Never mind, in Hokkien “Bo-Her-Hei-Ma-Xi-Hou” means no fishes, prawns also not bad. Let’s see little deeper into each mega-region development for their future. Before going deeper, forgot mention, each mega-region will need energy to fuel their ambitions. This China has been taking action to make sure their ambitions will not fail. China is building the largest solar-powered energy plant in Inner Mongolia to fuel Bohai Sea region. Also China is building 南水北调工程 to transport water through canals and pipes from the Yangtze River to the North, this masterpiece engineering will be finished in 20 years but worth the effort, so there will be no drought in the North. For Chongqing’s 西三角 China building oil pipes connecting Central Asian oil and gas to Chongqing, also 青海省 and 新疆自治区 oil and gas. Further China buying from Saudi Arabia, worth several billion dollars of petrol, will ship up to Cambodia through the Mekong River nations into Yunnan. China has agreed with Myanmar too for petrol to transport up into Yunnan. China is building oil refineries in Hainan Island, Guangdong, Zhejiang, Shandong and Hebei provinces. China is also building wind power, hydro-power and nuclear power plants all over the whole nation. Moreover they are building underground petrol tanks and electricity battery plants to store up energy to last a hundred years at least. Weekly the 长江三峡大坝 will produce electricity and to be stored up in battery plants to be used anytime. I can only describe a little deeper into each mega-region, you can read up yourselves in Internet. 长三角 ambitions so far the best in China among the four mega-regions. The total population in this region is more than 75 million people. Ambitious plan is to merge Wuxi, Suzhou, Kunshan and Ningbo (as the cross-sea Hangzhou-Ningbo Bridge completed) into Shanghai as “Enlarged” Greater Shanghai. Jiangsu province is also building the “Gold Coast Strip” 黄金海岸线 from 连云 港 at north down to 通州港 at south, I said in Lesson 41 these two ports will surpass Singapore.
Shanghai is building the world largest underground space network with pedestrian walkways and shopping streets all underground connecting the current MRT system. Shanghai is developing the world largest and best information network hub with the highest bandwidth speed to connect the world and whole China together, thus needs many IT talents there. How can SingTel challenge?? 珠三角 ambitions a little bigger, but may not be able to realize sooner than 长三角, is combining the whole region around Guangzhou into very large urbanized and industrial zone. Guangzhou and Foshan 佛山 have agreed to merge into one city under Guangzhou City. Currently HK and Macau is building very long bridge to connect each other to form triangular zone with Guangzhou. 环渤海 or Bohai Sea Circle is also very ambitious to combine all the 3 provinces of Shandong, Hebei and Liaoning plus Beijing and Tianjin, pulling in the whole North-east, Hua-Bei and Inner Mongolia together. It will receive petrol supply lines from Central Asia as well to fuel ambitions.
43 Next feedback question, how to differentiate the north and the south of China? Also is through China Geography. Without knowing Geography, can't know much about a country. Geography not only study land and climate, but also country's economy and population. Geography is a great tool for politicians to plan ahead in the future national strategies, also for urban planners and architects to know more about a place to design better buildings, and to marketers helping them to know their customers, not say you sell Laksa and Hainan Chicken Rice to people in Inner Mongolia and they will like the food, as they have never tried coconuts before. I heard S'poreans selling 潮州鱼头炉 in certain part of China and finally closed shop as he did not study customers'
requirement in that area. Not say Singapore is a household brand name in China and everyone will accept any Singapore products, do they accept and eat Laksa?? Do they eat 潮州鱼头炉?? From China Geography, we know there's a mountain range called Qin-ling 秦岭 at the central part of Henan province from Gansu and Shaanxi provinces. So south of Qin-ling is the southern block of China which grows rice, and north of the range is the northern block which grows wheat. Thus the two cultures of north and south is different using this mountain range as the divider. (The End)
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