China Law Blog

Despite the global recession, I remain an unabashed foodie. I figure, if I am going to eat, I might as well eat well. I am sure Eileen Wen Mooney would agree with me on that.

Ms. Mooney is the author of the books, Beijing Eats and Not Just a Good Food Guide: Beijing and the oft-cited Guardian article, "Top 10 Places to Eat in Beijing." She also has been writing a superb blog for the last few months, entitled, Eileen Eats. As you probably have guessed, its focus is on food in China, mostly Beijing. The blog does a great job discussing Chinese food history, Chinese food, Beijing food, and Beijing restaurants.

I heartily recommend it.

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KPMG recently came out with an excellent report on outsourcing to China (h/t to Experience Not Logic), entitled, "A new dawn: China’s emerging role in global outsourcing." KPMG summarizes its report as follows:

Outsourcing is on the agenda of the Chinese government as they seek to boost foreign investment into China and support the development of the services sector. Companies are also looking at China as an alternative to India, especially in light of recent security and governance concerns.

This paper looks at how China is moving up the value chain in developing the necessary infrastructure and outsourcing centers, and how that will impact the Asia-Pacific region and the rest of the world.

Because my firm recently started doing legal work for a very large China outsourcing company, I do not think it appropriate or even fair for me to comment on this article, but I am citing to it because it most certainly is well worth the read.

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When we first started this blog we would occasionally make fun of mainstream media's China coverage. I just realized we have not done that for years and I attribute that mostly to a huge increase in good reporting coming out of China. My firm is frequently interviewed by China reporters on China law issues and so we are able to judge up close and personal who among the media knows his or her stuff.

Tom Orlik knows his stuff.

We first started working with Tom back when he was with Morgan Stanley and would bring co-blogger Steve Dickinson in to speak on China law to Morgan Stanley clients and at Morgan Stanley functions. Before JP Morgan, Tom was with the UK Treasury and the IMF. He now now writes freelance on China, mostly on economic and financial issues, mostly for the Economist Intelligence Unit, the Wall Street Journal, and the Far East Economic Review. When it comes to China finance and economics, you will be hard pressed to find better and, on top of all that, he's apparently a pretty fair ping-pong player as well.

I mention all this because I just discovered his excellent blog, entitled China Translated, which Tom describes as "Commentary and analysis on China’s economic and political situation." I have spent the last hour catching up on its posts and I love it. I like the serious posts on China's economic situation, but I like even more the Freakonomics/Malcom Gladwell type posts with a China slant. For example, one of his posts proves that, contrary to widely held (and often stated) popular belief, Shanghai males are no less macho than their counterparts elsewhere in China.

I have added China Translated to our blogroll and I strongly suggest you there for more than a peek.

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The Beijing Axis business consultancy just came out with its quarterly "China Analyst" publication and it is chock full of nicely arranged economic statistics and predictions for China. If China economics is your thing, I recommend you check it out here.

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There are those who state confidently that China will own the worldwide car market within a few years (these people have been saying this for years -- check out this post from three years ago where I rightly said NO WAY) and there are those who state it will never get there. My only qualifications are that I come from Michigan and I have represented a few auto and truck manufacturers and a whole slew of auto parts manufacturers, including many in or going into China. But like just about everyone else, I have a view and mine is that China eventually will do well selling low end cars worldwide, but that it is not yet close to selling good cars in the United States. I spent seven hours in my car yesterday (driving back and forth to Wenatchee, WA) and there is no way I would have chosen a Chinese car for that trip. And it's not just me.

I landed in Beijing last month with my wife and daughter. The first taxi in line was a very old VW. The VW driver started putting our luggage into his trunk when a Chinese woman came over and asked us in pretty good English whether we wouldn't please take the taxi behind us (a much newer, but Chinese model) because she was going on a long trip with her family. My wife asked her why she wanted the one cab and not the other and the Chinese woman gave an embarrassed look, but said nothing. I explained to my wife that this woman did not want to go on a trip with her family in a Chinese car, but she was too embarrassed/nationalistic to say so. Since we were merely going to our hotel, it was no big deal and so we allowed the switch.

On that Beijing trip, I met with Bill Russo, a former Chrysler VP in China, now head of Synergistics Limited and, most importantly, a true expert on China's auto market. One of the things Bill told me during our meeting was that the Chinese would rather buy non-Chinese cars but buy Chinese cars based on price. That has always been my sense, but since I mostly hang out with Chinese attorneys who drive Buicks and Toyotas (mostly), I am not going to claim to have a representative sample.

But the big question regarding Chinese cars is when they will make their mark outside China and Bill Russo just came out with an extremely thorough and thoughtful piece on his blog that says, "not yet." The post is entitled, "The Path to Globalization of China’s Automotive Industry," and it says that China auto must achieve various intermediary benchmarks before it is ready for the world stage. If you have an interest in China's auto industry, this post is not to be missed.

A few weeks ago, I read a blog post from a Canada-US designer, Caroline Di Deigo, who traveled to China to, among other things, see the houses at The Commune at the Great Wall. She had been very excited to see these houses after having admired them in books, but upon seeing them up close, she was disappointed by their contstruction:

For several years I had been excited by images in architectural books of the houses at The Commune at the Great Wall, so this trip I made a detour from our group to see it for myself. The Commune at the Great Wall was developed by Zhang Xin between 1998 and 2002, when she commissioned 11 Asian designers each to design a house, situated in a rugged hilly location within view of the Great Wall. These houses, while privately owned, now function as a resort. In my opinion however, it is really a monument, or series of monuments, to design. At first glance it’s very impressive, with unique expressions of ‘house’, ‘home’, ‘dwelling’. On closer inspection though, I found them somewhat disappointing. Possibly due to their ultimate function, they lack much of a ‘residence’ feel, and seem a bit barren, very much like ‘public spaces’, vaguely ‘museum-like’. And to get really nit-picky, the quality of construction is unfortunately lacking, and from what one reads, certain of the designers were in fact quite disappointed with the implementation of their visions, as indeed I might have been.

Chinese cars are in many ways the same.

UPDATE: In his post, "Detroit, not Shanghai, is still the centre of the car universe,"
Posted Malcolm Moore, blogging for the Telegraph, agrees.

What do you think? Have Chinese cars arrived or are they three, five, seven, ten or more years away? When will a Chinese car brand have the reputation of Toyota, BMW or even Hyundai?

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A few months ago I was on a China panel at Northwestern's Kellogg Business School where, among other things, we were asked to list China's best opportunities. I stressed that because I am not a China business expert, I would have to answer the question based entirely on what I was seeing of my firm's clients and, based on that, I listed health care, technology, and food.

If I had to pick just one of the three, I would pick health care and technology (I know I said one, but hey, it's MY blog). I would pick these two now because even within just the last few months, China's government has made clear, both in its policy statements and in its spending, that it is going to be increasingly emphasizing these two during the next few years.

A couple years ago I did a post listing a whole slew of top China technology blogs and I plan to do another one soon. There is a surprising dearth of really good China food blogs and, as far as I know, no blog focuses on China's food business, which is too bad.

I am aware of only one blog with China's health care. It is called Asia Health Care Blog and I have been a regular reader for months. It is written by two Beijingers, Damjan DeNoble, who has a Public Policy B.A. with a certificate in Health Policy from Duke, and James Flanagan, who has a B.Com from McGill.

If you care about health care in China (and you should), I urge you to check out Asia Health Care Blog.

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@22tweets interviewed me via twitter the other day and that interview is now online here. Because it was on twitter, I was limited to 140 character answers (actually it was even less than that as some of the 140 characters went towards the address and the hashtag). 22tweets is run by the incomparable Lance Godard and it can be found here on Twitter.

It was really great fun and I can see where in real life it would make sense to limit people (especially lawyers) to such short responses. Not sure why 22tweets chose to emphasize my television and radio appearances in my background, but, hey, if you want to think I am a television star, that's alright by me.

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The title sums up my initial reaction to the news of Jackie Chan dissing the Chinese people by essentially saying they are too messed up to ever be able to handle democracy. I was going to write a blog post criticizing Chan for his comments and noting how the same thing has been said about other countries that are now democracies (the United States, Japan, West Germany, Italy, Spain and South Korea immediately come to mind). Then I decided I am not the right person to write such a post, so I didn't.

But today, over at The Useless Tree, I saw the post I would have written, if I were a thoughtful college professor of Chinese politics and decided to simply incorporate it as though I had written it myself. The post is entitled, "Jackie Chan does the Orientalist thing," and if you want to know why Jackie Chan should pretty much be ignored when it comes to world politics (just as anyone with any brains ignores Sean Penn, Woody Harrelson, and the various other Hollywood types when they talk about politics as though their simply being famous gives them a clue), you absolutely should read it.

For more on this, check out the following:
-- "Jackie Chan: A little bit of oppression may be good for the Chinese," in the Poli-Gazette;
-- "Chinese shouldn't get more freedom, says Jackie Chan,"in the Independent;
-- "No 'Rush Hour' for freedom," at TigerHawk

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About a month ago, I wrote a post, entitled, "China. Friend Or Foe? Opportunity Or Challenge? Or, Why Can't We All Just Get Along?" The post was on an unnamed client of mine who had written me an email regarding a wind energy project in which he had helped an Ohio company secure necessary parts from China. My client had written me an email regarding this project and of how he thought his handling the China outsourcing had saved American jobs. My post used my client's story to make the point that outsourcing products or components is not the same as outsourcing jobs.

Forbes Magazine liked my client's story and asked me for his name. After securing my client's permission, Forbes contacted him and the story has run, aptly entitled, "One Way To Save U.S. Manufacturing Jobs." It really does make for a great story and I particularly like it as it will probably be the only time I ever see Doug Smith (now named in the Forbes story) in a suit. Doug formed the first WFOE in Jining, an industrial city in Shandong Province, and he still bases his China operations there.

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One of the best/worst things about this blog is that just about every book that comes out on China finds its way to my desk, gratis. Most sit on my credenza for a few weeks, and then get moved to my bookcase, where I look at them from afar. I'm planning to read all of them eventually, but, you know....life just always seems to get in the way.

It has taken me forever to read the book, Flowing Waters Never Stale, by Mark Anthony Jones. On the one hand, I really wanted to read the book because Mark is a long time China Law Blog reader and a very thoughtful commenter here. On the other hand, I worried his book would be too intellectual and since it is subtitled, "Journeys Through China," I thought it would be too much the travel book. So it sat.

But I spent most of this weekend at the office on a big project and I started reading it as a diversion and I ended up hardly putting it down until I finished it. I wish I had read it sooner because I actually really liked it.

It is not so much a travel book as it is Mark's very thoughtful observations on much of what he saw in China while living there from 2002 to 2007. Mark looks closely at various aspects of China and (just as he does in his comments on this blog), he looks at them from various perspectives. It has no particular agenda on how one should view China, beyond seeking that we look at it fairly and in context. It often looks at things from both a Western and a Chinese perspective, with Mark's Chinese girlfriend, helping immensely on the Chinese side.

It really does make you feel like you are in China and I heartily recommend it.

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Fascinating two part interview with Bill Russo, Chrysler's "first Regional Vice President in Northeast Asia with over 20 years in the automotive industry"on the new and very promising Aimee Barnes blog. Post is entitled, "Link Up, Learn More: Interview with Bill Russo, Automotive Industry Expert" and part one is found here, with part two here. Big takeaway: Russo sees it being 5-10 years before Chinese cars start really showing up in the United States and EU.

Definitely recommended to anyone (and isn't that just about everyone?) interested in China's automotive industry.

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Domestic US lawyers frequently call my law firm asking us to help them enforce their just received US court judgment overseas. They are seeking to turn the US judgment into a judgment of the country where the defendant is located so they can, in turn, collect the money owed under the judgment. Way too often, however, these lawyers are operating under the assumption that all we need do is take the judgment to a foreign court and ask them to enter it as a new, local judgment.

My response on taking US judgments to China is that there is no reason to do so because they have no value there. This is less true for Europe, where if one plays the cards absolutely correctly from the very beginning of the US court action, it is sometimes possible to convert a US judgment into a local one.

My law partner, Nadja Vietz (who is a licensed attorney in Germany, Spain, and the United States -- think about that for just a minute!), just came out with a cover story for the Washington State Bar Journal, entitled, "Will Your US Judgment Be Enforced Abroad." It is a great article and I highly recommend you read it BEFORE starting a US action against a foreign company.

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Earlier this week, I participated in a most interesting podcast on China with Britain's most famous, most controversial, and most beloved law blogger, Charon QC. I used to always say that if and when I am ever reincarnated, I want to come back as a QC. Now I am thinking I would just settle for having a sophisticated British accent like Charon QC and the ability to write about my quasi-fictional self in the third person like this. cool whil.

Go here for the interview.

What do you think?

Oh and for all you numerologists, what meaning should be drawn from the fact this was podcast #111 and the number of the house in which I grew up was 111?

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The US-Asia Law Institute website has a webcast entitled, “China’s Changing Courts: Populist Vehicle or Party Puppet?” It features a truly stellar panel of China law scholars, including Prof. Ben Liebman of Columbia Law School, Prof. Xin “Frank” He of the City University of Hong Kong School of Law, Prof. Nicholas C. Howson of the University of Michigan School of Law, Prof. Carl Minzner of Washington University School of Law, and Rachel E. Stern, a Ph.D. candidate at the University of California, Berkeley.

The panelists will be answering questions submitted by Wednesday, February 25, 2009 to usasialaw@nyu.edu, with the subject line "Court Panel Question." Answers will be posted by March 2, 2009.

I have yet to listen to it, but I would love to hear from those who do.

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Unable to read either Mandarin or Chinglish well enough to recharge your China Mobile card? I recommend you read the China Ginger post, entitled, "How to recharge a China Mobile card in English," with step by step instructions (in English) on how to do exactly that. If this does not work, you can do what I usually do when I am in to China -- use someone else's phone or pay around $3.00 a minute on my AT&T iPhone.

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Loretta Chao and Andrew Batson of the Wall Street Journal have written an excellent piece on what is going on these days with China factories. The article is entitled, "China's Small Factories Struggle," and it is about factories closing, factories changing to meet changing demand, and about factories starting up. Not news breaking by any means, but a piece well worth reading to get a sense of what is going on with China's factories.

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Post over at I Only Like China, entitled, "Visa troubles: trials, tribulations and tomfoolery," does a nice job comparing the various China visas and setting out the machinations one often has to go through to get one. In defense of China on this securing a United States visa is no easier/better.

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The most recent issue of Supply & Demand Chain Executive Magazine has a really informative article by Steven Ganster on China. The article is entitled, "The China-ready Supply Chain: Key attributes to ensure a high degree of readiness for doing business well with China," and it does an excellent job setting out what foreign companies must be on the lookout for "doing business well with China and getting excellent performance from your supply chain."

The article very nicely sets out the following four key challenges to address to make your supply chain China-ready and then sets out to explain how to meet these four challenges:

-- China's vast and complex market landscape. China crams its 1.3 billion citizens (estimates of China's population range from 1.2 to 1.5 billion, the margin of error being the size of the United States) into a space the size of the continental United States, and it boasts more than 170 cities with a population exceeding 1 million residents. Almost 70 percent of economic, trade and investment activity is focused in a small group of provinces along the east coast, yet China's domestic infrastructure is very inefficient. As a result, moving goods within China takes time and costs a lot of money. Transport costs can be 40-50 percent higher than comparable figures in the West. There is a shortage of railway and river transport capacity, internal toll rates can be obscenely high, and the technology of the freight movers and handlers is pathetically low.

-- Opaque financial and legal systems. Those active in China know that things are often "gray." Many Chinese firms will have two or more sets of books, with the real numbers in the head of the owner. While many new laws are being promulgated, their interpretation (not to mention enforcement) leaves much to be desired. China is still a country of "rule by man" versus "rule by law." This lack of transparency makes it difficult to know what your real costs are and certainly makes it hard to know with whom to do business and, of course, whom to trust. As a result, financial planning must be done with an uncomfortable level of uncertainty.

-- Huge cultural and business system differences with the West. In the scale of human development, China's economy would be barely out of adolescence. Business systems are immature, and Western-style management experience is hard to find. This is coupled with sharp cultural differences with the West in terms of values, communication style, organizational hierarchy and even life experience. Understanding and appreciating the differences in business culture in China is one of the most underestimated challenges faced by Western management. Intertwined with these business and cultural differences is a pervasive level of corruption, either outright graft or more subtle gray tactics in business practices that often depend heavily upon relationships (guanxi). Progress in this area is taking place, such as in intellectual property protection, but it will take generations to fully eradicate the old ways of doing business.

-- Rapid pace of change. The constant dynamism in all aspects of China's economy only aggravates the above challenges. For example, within the last two years alone, China's currency has appreciated by 20 percent, the VAT rebate on exports was reduced to almost nothing, oil reached $150 a barrel before falling back again, and a new labor law has gone into effect. The combination of these changes has cost many Chinese exporters about 30 percent of margin. (Interestingly, as this article is being written, China is again raising the VAT rebate for a number of products in response to the duress of many Chinese exporters.) The ripple effect to Western companies' sourcing strategies has been equally disruptive as costs have gone up, suppliers have abandoned ship and transport costs from China to the West make current sourcing patterns questionable. Planning for China is like shooting at a moving target.

I recommend you check it out.

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Of those who comment on our blog, I never remember who agrees or disagrees with me on issues, but I always remember those who make me think. That is why I remember G.E. Anderson and that is why I was so happy to learn (from Professor Donald Clarke, the brains behind the Chinese Law Professor Blog) that G.E. Anderson has just started his own blog. Anderson's blog is ChinaBizGov and its tagline is "Highlighting interesting issues in business-government relations in Greater China."

Anderson describes himself as a "China specialist, former CFO, and PhD Candidate in Political Science at UCLA. Research focuses on state-owned enterprises, corporate governance and China's auto industry."

It took me only one post to know I was going to like this blog. The post is today's post, entitled, "Privatization of Central SASAC Assets," in which Anderson talks about a conversation he recently had with a journalist out of Beijing on whether China is moving away from privatization, without really making a conclusion one way or another. This is a great issue and one I too have been struggling with. I did a post a few weeks ago, entitled, "China And The US. Which Of Us Is The Most Capitalistic?" postulating that as the US moves away from rampant capitalism, China is moving towards it. Yet, within hours of having done that post, I started having doubts regarding China's moving toward capitalism.

Is China getting more or less capitalistic? Help me out here cause I dunno.

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"'You sit by yourself grasshopper. What do you think of?' -Master Po 'My mother, my father. Both gone. I am alone.' 'You hear the flock of birds flying overhead? You hear the fish? The beetle?' To all of this the young Caine nods. 'In this crowded place you feel alone. Which of us is the most blind?"

In his post, "Is China now more capitalist than the US?" Ed Morrissey over at HotAir has written what so many have been thinking [h/t to China Challenges]. As the US economy tanks, the US moves away from capitalism. As China's economy tanks, it moves towards capitalism. There is obvious irony here, but also a pretty good petri dish(es) to test which works better when things start going really wrong.

We will see.

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Above the Law (this is the site that had my firm merging with Baker & McKenzie???!), just did a post on how the Asian legal market is not as hot as the New York Times and other MSM have made it out to be. In other words, if you are a Western lawyer hoping to get hired in Asia, you had better have some credentials evidencing a serious Asia connection. The post is entitled, "The Asia Chronicles: Fish-Head Soup," and I recommend it to those hunting for law jobs in Asia.

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In its post, "China Not Brave Enough to Save the World," the always excellent China Economics Blog, makes the valid point that China (and by China I think we mean the China sovereign funds) is a terrible investor. Its history indicates that and according to this article, so will its future. Like so many new to the investing game, China seems to think the maxim is buy high sell low, rather than the reverse.

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EastSouthWestNorth. Is any English language China blog more influential? I don't think so.

Roland Song of ESWN was to give a speech at CNBloggercon, but was unable to attend due to a family emergency, so he has put online what he was going to say, entitled, "Reflections of a Bridge Blogger." (h/t to Lost Loawai) It beautifully sets out the evolving history of the "treatment" of China "social incidents" and the role the internet has played in this. It makes for great reading.

CnReviews does an amazing job, here, of summarizing CNBloggercon.

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David Dayton of Silk Road International has a fascinating, though disquieting post, entitled, "Another Trip to the Healthy Department." Dayton's father was a doctor and Dayton tells us (in vivid detail) why he thinks it better never ever ever to go to a hospital in China, which hospitals he describes (based on a far amount of international experience) as being the worst he has ever seen.

For what it is worth (quite little, I daresay)I have been to a hospital in Yantai, China, Dubrovnik, Yugoslavia, Yuzhno-Sakhalinsk, Russia, and just about EVERY emergency room in Seattle, Washington and I would rank them in the following order of best to worst, in terms of cleanliness:

1. Seattle
2. Yuzhno
3. Dubrovnik
4. Yantai

But what do I know? My father was an English professor.

Would love to hear your hospital stories.....

UPDATE: Found in China did an interesting post recently on a trip to a Chinese hospital, entitled, "Medical Examinations In China: A Laowai Exposed."

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Elliot Ng over at CnReviews just came out with a very thoughtful post analyzing China's economy. The post is entitled, "Global financial crisis will hurt China much more than the US," and it says China's economy is based on a three legged stool, two of which are weak. The three legs are "export-led growth," "real property growth," and "government spending." Right now, only government spending is still strong. The post pulls from a number of leading economists and analysts to conclude that China's economic future will not be good and that we can expect China's economy to slow to 5-6 percent yearly growth.

I tend to agree with the analysis of this post, but whenever dealing with economic predictions, I always feel compelled to throw in the caveat that they only tend to be accurate if all assumptions hold true, which they hardly ever do. I was one class short of an economics major, which means I studied just enough to know that economist's predictions are correct about half the time.

On a somewhat less gloomy note:

An economist, a physicist and a chemist are stranded on an island with one unopened can of food. The physicist suggests they roll the can down a hill where it will strike a rock which will pierce the can and release the food. The chemist suggests they cool the can in the ocean then heat it in the sun so as to cause the can to burst. The economist suggests they assume they have a can opener.

Let's hope for the can opener.

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Google just came out with millions of photographs from the archives of Life Magazine and, as anyone who has seen Life Magazine would know, they are riveting (h/t Shanghaiist), I have been checking out photos of old Shanghai and Beijing (a/k/a Peking). I am, however, a bit disappointed at how my searches of Qingdao, Dalian, Chongqing, Chengdu, Xiamen and Tianjin all came up empty. I highly recommend you check it out.

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Fascinating post over at China Economics Blog, entitled, "The geographic similarities between China and the US." The post is on a recent Financial Times (FT) article, entitled, "How China can be more than 350 Albanias," that starts out noting all kinds of similarities between China and the US, but concludes by pointing out that China's per capita income is still less than that of Albania, though with 350 times the population. So do we view China as we view the US, or is it just Albania times 350? I say both.

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There is a strange dearth of materials out there for foreign companies seeking the nuts and bolts of how to get into selling their products online in and into China. I was recently alerted to an paper written on this very subject by Lisa Conklin, for her MBA degree at Fudan University. I enjoyed the article and thought it would be helpful to our readers and so I requested Ms. Conklin get it up on the internet to facilitate my linking over to it. That has been done and if you click here, you will see the article, entitled, "Chinese E-Commerce 2008: An Introduction and How-To for US SMEs." [pdf]

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The Green Leap Forward recently did a comprehensive overview of the Singapore-China eco-city going up on a massive scale just outside Tianjin. If you have any interest in eco-development, you should check it this post, entitled, "Creating A Better Life: A Closer Look at the Sino-Singapore Tianjin Eco-City Project."

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The China Observer blog has been up for about two months now and I have already become a regular reader. The blog is written by Joel Backaler, who describes himself as follows:

Joel Backaler (周乐达) first traveled to Beijing in 2001 and has since returned to the capital city where he works as the only non-Chinese analyst for a leading multinational IT and management consulting firm. Joel has accumulated over six years of China market experience through positions in venture capital, new media entrepreneurship, independent consulting and research.

Joel holds a Bachelor of Arts degree in Economics and East Asian Studies from Connecticut College. He was awarded the prestigious U.S. State Department sponsored Fulbright Fellowship to work and study in Taiwan. Upon completion of his Fulbright grant Joel studied under the academic year program at the Stanford/IUP Center intensive language training program hosted by Beijing’s Tsinghua University.

Joel is a native English speaker. He speaks, reads and writes fluent Mandarin Chinese; and is conversationally fluent in Spanish.

Joel is using his blog to chronicle what he is seeing in China, which is "the next big thing":

China is the next big thing.”

Every visit home, friends and family all make the same observation: “You’re in the right place. China is the next big thing.”

When asked why, most offer anecdotal evidence about China’s rapid economic growth and the outsourcing of American jobs. They just don’t get it.

Back in Beijing, I am surrounded by many friends and colleagues, both expat and Chinese, who do get it. Like me, these dynamic and diverse professionals live in China and understand the language, culture, and business environment. Innovators write blogs about the latest happenings, emerging businesses and all aspects of China’s ongoing transformation. Silicon Hutong, China Digital Watch, and China Law Blog are just a few of my favorites.

What is missing, however, is a bridge connecting these two groups (what I define as Outside Observers and Inside Observers). Someone to take key local observations from within China and share them with the greater global community. The China Observer Blog presents readers with the essential information on companies you need to know, best business practices and cultural factors that drive the Chinese marketplace. Only through analysis of these factors can one begin to truly understand why and how the focus of the global economy has shifted away from the U.S. and other traditionally “strong” economies.

* * * *

The ultimate goal of The China Observer Blog is to educate and offer readers a source of current and comprehensive information about the business world in China. My aim is to be an educator across borders and cultures. In today’s business world, if you don’t know about what is happening on the ground in China, then you will inevitably be left behind.

Yes, I agree: China really is “the next big thing.” I don’t feel this way because of what I have heard from the mass media, or because of the stories I’ve been told by friends impressed by China’s dramatic growth. I base my opinion on first hand observations made while living here in China. The China Observer Blog presents these local observations to you and gives you the opportunity to see what today’s China is really all about.

Despite Joel's gargantuan ambitions for his blog (ah, youth), of which I do not believe any one blog can achieve, the blog does fill a very nice niche. Many of the posts start with Joel's observing a China business or industry, then explaining how that industry works in China and what we can expect of it in the future. He does this with China's online gaming industry, China's plastic surgery industry, and China's beauty products industry, among others. To complement his industry observations, Joel also throws in an occasional post on what I would call the cultural ramifications of technology in China.

I urge all readers to check out The China Observer.

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Very thoughtful piece on The Hypermodern on how China cannot take its position and status in the world for granted. The post is entitled, "The Loss of Soft Power," and it is well worth a read.

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The Joint US - China Cooperation on Clean Energy Forum (JUCCCE -- Is that pronounced Juicy?) recently ended and China Environmental Law was there and has posted on it, in its aptly named post, "The Morning After." This post nicely summarizes went transpired and links over to various other sites for those who just can't get enough clean with their tech.

The post includes the following money quote, which near as I can tell from the many clients of my firm that are in the China cleantech business, could not be more true:

China will continue to be a “pilot program” heaven: if you have a technology, product, or service, you would like to test in a low-cost environment, you will probably be able to find a partner in China (as long as it doesn’t cost them anything) to help you test it. But remember, China still doesn’t have that IP protection thing down pat yet.

Do check it out.

UPDATE: In its post, "JUCCCE Clean Energy Forum–Closing Summary," The Green Leap Forward,' provides a transcript of the excellent and inspiring (that is the first time I have used that word on this blog) closing speech by Julian Wong, who is the author of The Green Leap Forward.

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The Wu Way blog, provides the best analysis I have seen on how China views last night's election of Barack Obama as America's next president. The post is entitled, "How does China view an Obama Presidency…what does China think of Obama?" and it sees China (to the extent one can generalize about 1.3+ billion people) as "excited about the election as a historic moment, but also cautious in their concern that he may be more protectionist."

It is well worth a read.

UPDATE: China Beat also does an excellent job on this in its post, "Obama Elected, China Reacts."

FURTHER UPDATE: This does not exactly fit here, but I liked it so much and it is election related, so here goes. I just read an excellent article over at Spot-On, by Jeanne Jackson, entitled, "The Day After." The article, and, in particular, the following paragraphs, summed up better my feelings than even my own feelings, and certainly better than anything I could write myself:

Perhaps you are celebrating today. Or, perhaps, you are annoyed. I certainly hope, whether you backed the winner or loser, you are being gracious about the outcome. I will almost sell my first-born to purchase a one-way ticket for the first moron who sneers about moving to Canada because his candidate lost.

It is, perhaps, an old-fashioned idea, but I've always had a certain amount of respect for the office of the presidency, no matter who occupies it. Granted, over the centuries we've had our share of . . . um. . .characters. And, believe me, I've been a victim of presidential policy more times than I've benefitted.

But I am in awe of the process and its relatively peaceful outcome. I am in awe of the fact that there are two people willing to risk the biggest, most public of all losses and always do so with class and dignity. For that reason, I can't hate a president (though I can pray to a merciful God for deliverance from incompetence).

Damn, that's some good stuff.

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As good a foreign policy article as you will find in a US newspaper is a piece is by Washington Post "World Columnist," Robert Kagan, entitled, "Still No. 1." I learned of this article from foreign policy expert Thomas P.M. Barnett, who stated he agreed "with it 100%." I do too.

What do you think?

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Laurel Delaney of The Global Small Business Blog was on blogtalkradio the other day talking about 10 ways to take your business global. Ms. Delaney is one of the foremost experts on taking small businesses global and she shares a lot of good information in her thirty minutes here.

Ms. Delaney then summarized and added to her talk on her blog, as follows:

Reasons for going global (not covered on the show): • Increases sales and profits. • Augments competitiveness. • Earns a greater return from a set of core competencies. • Generates economies of scale in production. • Enhances local competitiveness and opens up the way to larger, more lucrative customers. • Create jobs, productivity growth, and wealth. • Enlarges the pie of potential investors. • Insulates seasonal domestic (local) sales by finding new foreign markets and selling excess production capacity. • Cuts costs through global outsourcing. • Reduces dependence on existing markets. • Capitalizes on tax advantages.

Ways to go global:

1. Build a website.
2. Create a blog (Blogger.com, Wordpress, Typepad).
3. Start a wiki (PB Wiki or Wetpaint).
4. Launch a social media platform similar to Facebook but outside of Facebook (try Ning.com)
5. Offer lots of free stuff -- meaning, best practice PDF files, white papers or articles covering what you are good at -- and place it on all your media platforms.
6. Start communicating with business reporters (WSJ, NY Times, International Herald) who cover your business beat.
7. Join like-minded social media platforms (Small Business Trends blog or OPEN Forum by American Express or here!) and comment wherever and whenever you can in areas that touch on your expertise.
8. Work-it. You have to really work-it as they say. Nothing comes easy. Dedication breeds passion, enthusiasm and people wanting to connect with you to buy whatever it is you are selling (books, products, services, etc.).
9. Partner with the big guys. Once you are established, think of ways to partner, or form a strategic global alliance (SGA), with a business that has already penetrated an overseas market you want to enter.
10. Look to your customers for referrals to other parts of the world. After all, without them, there is no global business.

Places to go for help:

www.globetrade.com
www.exim.gov/smallbiz/index.html
www.ups.com/globaladvisor
www.buyusa.org
www.us.smetoolkit.org/us/en

Also important but not mentioned:

Before you go global, establish a BOGA: Board of Global Advisors who comprise of:

International lawyer
International tax accountant
International logistics expert

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China Business Blog and Podcast has a great post up on what it calls China's pre-consolidation stage. The post is entitled, "Signs: Observing the pre-consolidation stage in China," and its gist is as follows:

But I think there are some signs that are quite clear that are telling us what stage we are at in China’s growth — and one of the defining features of this stage is what I call “pre-consolidation,” meaning, generally, that many industrial sectors in China are still very diverse, fragmented and messy but are in the process of becoming more aligned and streamlined. Instead of trying to further describe this stage, I would like to look at four “signs” that define what I am calling “pre-consolidation” and signal that we might be coming to a crossroads.

First of all, the biggest sign — and the easiest to recognize — is simply the number of players in many market sectors in China. One of the features of a more mature economy is that there have emerged several large players in a particular sector and other players have either fallen away or have been gobbled up (and that’s how the big players got that way, growth by acquisition). The auto industry is a good example — in the early 1900s, there were dozens and dozens of car companies in the U.S.; today, there are only three (and if the talks GM is reportedly having with Chrysler come to fruition, there will only be two!). China is on the other end of this spectrum. There are over 54 different car companies operating in China and well over 100 brands. Given time, consolidation will happen, but for now, China is in the “pre-consolidation” stage.

This post does a superb job explaining China's economy from a business perspective and I strongly recommend anyone with any interest in China business read it (or listen to the podcast) -- it is that good . . . .though quoting Billy Joel really ought to be verboten.

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Chris Carr over at Cal Poly MBA Blog just did a post on trade shows in China, with a lot of really good and helpful links regarding the same. The post is entitled, "Visting a Trade Show in China," and in it, Chris rightly points out how "trade shows are a much, much more prominent marketing and promotion channel [in China] than in the US" and how "when that day comes when you have the opportunity to attend a trade show in Asia, you MUST grab that opportunity.' All I will say is that I have done my time.

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There are two kinds of people. Those who hate going grocery shopping, and those who love it. I fit into the second category.

I love it for various reasons. I love food. Going to the grocery store is for me what going to a stereo store is for an audiophile or going to a book store for a bibliophile.

But I also like grocery stores for what they reveal. A Whole Foods executive once told me that Whole Foods chooses locations with a high level of educational attainment. So just seeing a Whole Foods tells you there are a lot of people with advanced degrees living nearby. But going into one will tell you a whole lot more. My "home" Whole Foods here in Seattle has a massive seafood selection. The one in my brother's Houston neighborhood has a smaller fish section, but a much larger meat section. From this I conclude that educated Seattleites eat more fish than educated Houstonians, while the reverse is true for meat.

I went into "my" Whole Foods this evening and I noticed two things. One, it was less crowded than probably any other Sunday at around that time, and two, there seemed to be more of an emphasis on the "value" of items and their sale prices. Shucks, if I hadn't gone shopping this evening, I would never have known we are in the midst of a financial crisis.

Seriously though, whenever I go somewhere new, I love going to the grocery store. It gives me a better feel for the local culture and the local economy.

So I was delighted to learn of a relatively new blog out there that feels as I do regarding grocery stores and food in general. The blog is Beijing Gourmand and its subtitle is just perfect: "Understanding China through its stomach and my own." It further describes itself as looking "at not only what and where to eat in Beijing and China, but also examines the social and economic aspects of our food and where it comes from." I like that and I like the blog. I also know have known "Benjamin," the force behind this blog, for years and know him to be a very thoughtful guy and an excellent writer.

Some of my favorite posts:

1. "Like a (kaoya) Virgin," which waxed so poetic (along with photos) about a Peking Duck restaurant that it had me momentarily reconsidering my decision to give up meat more than 15 years ago.

2. "China's Crops Challenge," which does an excellent job explaining why China's agriculture policies are progressive.

3. "Lau Kin-Wai: Decline of Chinese Cuisine Since the 1950s," explaining how the old ways of cooking were better, yet are fading out due to it being so time consuming.

I just added Beijing Gourmand to our blogroll.

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Absolutely excellent article on the Council for Foreign Relations website on China food and drug safety. The article is entitled, "China's Troubled Food and Drug Trade" and it does a superb job explaining the food safety issues surrounding China food and drugs.

The lawyer in me sees the following as the "money" quotes:

Some families have moved to sue the companies involved, though China's tort system only allows for direct economic damages. Such amounts are likely to be far smaller than the massive punitive damages allowed in the United States that often serve as a deterrent to companies. Market forces can still play a role in China. People's unwillingness to buy milk products over fear of which producers to trust has been a huge blow to the country's dairy industry.

* * * *

Liability issues for international companies using Chinese supplies are a growing concern. Jerome A. Cohen, a CFR adjunct senior fellow, writes that the liability for New Zealand firm Fonterra, a major investor in the Sanlu Group, is unclear. Cohen says the case offers a lesson for other foreign investors. Experts are also quick to point out that China's food problems mirror those that other nations have experienced, including the United States. They add, however, that China's massive growth in trade and the realities of globalization makes the country an exceptional case, increasing the urgency for Beijing to tackle its food problems.

The US consumer in me sees the following as the key:

In the United States, consumer groups have called for greater scrutiny of food imports by the U.S. Food and Drug Administration (FDA). The FDA currently inspects only a small portion (PDF) of food and drug imports. An FDA official told Congress in 2008 that the agency was moving to improve safety measures (PDF), particularly against terrorist threats from those who might purposely adulterate food. The official added that the FDA is working with the Chinese government to increase inspections.

Of the inspections the FDA does conduct, food from India is more likely to fail than food from China. Illnesses from food in the United States more often originate domestically, U.S. congressional investigators said. The United States allows no imports of meat and poultry from China because U.S. law requires importers to meet the same standards as U.S. producers. The U.S. House Energy and Commerce subcommittee investigative report concluded that such a standard could not be imposed on all imported food but notes the import process can be made safer. The report also points to Japan and Hong Kong's import models as possible alternatives to the U.S. system. Japan, for example, inspects up to 16 percent of food from China and allows in food that originates only from a small number of certified farms and plants. But more stringent inspection regimes are not fool-proof. In 2008, hundreds of people in Japan fell ill from Chinese-made dumplings laced with pesticides, and Hong Kong found melamine-laden in milk products imported from the Chinese mainland.

The law firm marketer in me sees the need to call out the following paragraph as well:

In the United States, food safety is also enforced through a variety of other means, including a punitive torts system, independent media, and vigorous civil society organizations. These institutions in China are not nearly as powerful, though some analysts see signs of change. Steven M. Dickinson, a partner in the international law firm Harris & Moure who has spent the last five years in China, says local media played an unprecedented role informing the public during the 2008 milk scandal. Some critics, however, say the milk incident could have been dealt with months earlier and blame the country's focus on the Olympics for stifling early warnings.

It is truly a must read.

And for those (like me) interested in food safety, I highly recommend the Barf Blog, which describes itself as "Musings About Food Safety and Things that Make You Barf." It makes salmonella and e.coli fun. I also recommend the MarlerBlog, written by renowned Seattle food safety litigator, Bill Marler.

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David Wolf of Silicon Hutong has a very thoughtful post up on innovation in China. The post is entitled "Searching for China's Soul of innovation," and it nicely takes us through China's interrupted history of innovation and posits whether China will become a great innovator again, what it might take for that to happen, and what that might mean if it does.

I agree with Wolf that China innovation is going to be with Chinese characteristics, not just some knock-off of US methods:

So much of what is written about China and innovation today, whether by foreign or Chinese observers, is patronizingly prescriptive. If China wants to innovate, it must imitate - it must recreate the conditions that exist in high-tech hothouses of Silicon Valley, Boston's Route 128 corridor, Austin, and Seattle. There is some truth in that, but there seems something unnatural about trying to graft San Jose onto Shanghai, or Federal Way onto Tianjin.

* * * *

Perhaps the answer for China is to search for an answer to the independent innovation challenge in its own history, applying foreign lessons where appropriate.

Federal Way? Here in Seattle, Federal Way (a small city located between Seattle and Tacoma) is known more for its Wild Waves Theme Park and used car lots than for any innovation. Did you mean Redmond, home of Microsoft and many other tech companies?

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I am just so glad James Fallows is writing about China. One hundred years from now, when the West is looking at why China is where it is, historians will read Fallows.

In the most recent issue of Atlantic Monthly, in an article entitled, "Their Own Worst Enemy," Fallows does a great job explaining the disconnect between how the West sees China and how it really is. The article's subtitle is "As China prepares to take its place as the world’s dominant power, it faces confounding obstacles: its insularity and sheer stupidity in delivering the genuine good news about its own progress."

China PR guru, ImageThief, in his post, "The tragedy of China's international communication," has this to say about Fallows' article and about China's lack of PR prowess:

Fallows' point --and I agree with it-- is that the great tragedy of this is that there is much positive happening in China and many good stories to tell, but that they often get lost among the time-warp rhetoric, self-destructive mistakes and ham-fisted attempts at total control. That's a shame, because the essence of good PR is to find the good stories and tell them well. Fallows also points out that the government's domestic communication abilities far outstrip its international ones. As someone who lives in China and likes it, I sympathize with the need for better external communication. As a PR man, however, I often cringe at the attempts.

I agree and will raise both Fallows and ImageThief one by pointing out how ultimately dangerous Western misconceptions of China can be. The US needs allies in the world right now and we should be making nice with countries that are seeking to build, rather than destroy, seeking to grow their wealth, rather than to terrorize others, and seeking to move towards freedom, rather than towards increasing repression. For all its faults, China is moving (yes, slowly) on the right path and we should be working WITH it as it does so.

Oh, and the reason I titled this post as I have is because I have yet to speak with someone who has gone to China who was not shocked at how much "better" and "freer" it is than they expected.

Please read Fallows and then let us know what you think.

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Benjamin Joffe of Plus Eight Star has put up his Powerpoint presentation from the recently completed OpenWebAsia08 conference in Seoul. The Powerpoint is entitled, "Collaboration Beyond Culture" and it is on innovation in Asia and the tendency of the West to ignore it, at its own peril. The presentation is quite persuasive, and as a sushi addict, I particularly appreciated Benjamin's inclusion of sushi as one of Asia's top inventions. Check it out.

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McKinsey is just out with a new and very comprehensive survey and analysis of the Chinese consumer, entitled, "What's new with the Chinese consumer" (free registration required). Its subtitle is that "It’s hard for brand managers to keep pace with the shifting attitudes of Chinese consumers. But some trends can be discerned amid the noise."

The upshot is that brand loyalty seems to be weakening in China and word of mouth is more important than television ads. Unfortunately, this survey was before the Sanlu milk scandal which must have impacted consumer sentiment.

Go here to learn all.

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The fastest I have ever gone on ground was in the Shanghai Maglev. It really is pretty amazing to be going past cars on a highway as though the cars are standing still. In its post, "Ride with me on the Shanghai Maglev," the Little Red Blog, shows us video of a Shanghai Maglev ride. It really is the next best thing to being there. Check it out.

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Asia Logistics Wrap is on part two of a very thoughtful seven part series on Asian supply chain challenges. For those involved in moving products into, within, or out of Asia, I strongly urge you to start reading this series. Part I is here and Part II is here.

Asia Logistics Wrap's post stems from this post on Bob Ferrari's Supply Chain Matters Blog.

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Very interesting article in Esquire Magazine, entitled, "The New American" and subtitled, "Young entrepreneurial Americans are doing something they have not done much before. They are leaving. And even more than our government, our military, or our movies, they are expanding American influence in the world. Even in a crazy place like Shanghai." (h/t to All Roads)

The article is about Barrett Comiskey of the Nicobar Group, (full disclosure: Nicobar is a long-time client of my firm) and how he and his company have adapted so well to China. The article does a great job conveying Shanghai's excitement (both good and bad) and explaining why so many young Americans/Westerners are going there to make their mark.

It's Esquire Magazine and it makes for a great read.

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Not for anything he has said or done on the bailout, on which even those of us who agree it was necessary cannot truly be happy about. No, I like him for his opinions on what the United States must do in terms of its relations with China.

Paulson just came out with a very thoughtful piece in Foreign Affairs Magazine, entitled, "A Strategic Economic Engagement: Strengthening U.S.-Chinese Ties." The summary nicely summarizes the article as follows: "The prosperity of the United States and China depends on helping China further integrate into the global economic system." (h/t to The Black China Hand)

Paulson says that no matter how one views China, engagement is the best policy:

Some people suggest that China is a threat that must be countered or contained. Others argue that its growth is an opportunity for the U.S. economy and that Washington should manage this rising power through engagement. I believe that engagement is the only path to success.

This is the kind of article that can and should change minds.

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Interesting Washington Post article by Ariana Cha, on how Shanghai might eventually replace New York as a world financial center. The article is entitled, "Financial Hubs See an Opening Up at the Top: Wall Street's Long, Dominant Run Is Fading, Global Financiers Say," and it talks about how Wall Street is falling and others are rising, and it devotes much of its ink to Shanghai. Trendsniff also has a good post on this.

I do not see Shanghai becoming a top tier financial center within the next ten years. In ten years, New York and London will still be the World financial centers and Singapore, Hong Kong and Tokyo will still be the big three in Asia. I could write a long post on why I think this is true, but it would be far easier for me to simply state that I see knocking New York and London off their thrones as the equivalent of knocking Mercedes and BMW off theirs -- it is just too difficult.

Will Shanghai be a top one, two or three financial center within the next ten years? What do you think and why?

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I admit it. I think I like China Smack. I know I drop by there every once in a while and though I often feel like taking a shower afterwards, I keep going back. Truth From Facts does a good job describing what China Smack is all about and, in doing so, explains its appeal:

ChinaSMACK is one of my favorite new China blogs. It translates some of the hot topics in China’s online forums and bulletin boards, complete with pictures, video, and numerous reader comments translated from the original Chinese posts. The author seems to favor the more lurid stories, such as a confrontation in Wuhan between a Wuhan bus driver and several passengers.

Half of me feels like I am learning more about real life in China by reading China Smack, but the other half just flat out finds it fascinating. Its most recent post is on a handicapped street artist and like so many of its posts, the comments are equally riveting. The commenters bemoan the lack of opportunity for the handicapped in China.

Check it out and let me know what you think.

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China Comment tells us, here. Problem is that what is happening right this minute may not be what happens next week. If the US bailout fails to occur or to stick, I fear we are all going down.

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China Financial Markets Blog poses this question in its post, "Is China Safe?" Go there for both the post itself and for its long list of very thoughtful comments.

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ImageThief is just out with a great post on the Sanlu melamine crisis. The post does an amazing job giving a history of China's food safety problems, dissecting the current one, and discussing in real world terms Fonterra (the New Zealand company involved in a joint venture with Sanlu) has handled it, and how Fonterra should have handled it.

The post is entitled, "Melamine in Sanlu milk powder? Now that's a crisis!" and it is a must read.

UPDATE: Peter Ford over at the Christian Science Monitor did an excellent story, entitled, "Behind bad baby milk, an ethical gap in China's business."

I know this is not what non-lawyers want to hear, but unless and until any and all companies tied in with incidents like this are forced to pay by way of huge court verdicts, this sort of thing is going to continue.

ADDITIONAL UPDATE: Will Lewis over at Experience Not Logic (a really good blog, BTW) tries to explain the whys of this in his post, "Why the %$#@ is Melamine Added to Food?!?"

Why aren't US and EU food producers doing this? If China's analogue is the US in the late 19th/early 20th century, check out The Jungle. Basically, we've got stricter regulations, better testing equipment, and, in the US, a tort system that will make you pay dearly for these failures. These are just things that come with time and the maturity of the legal system. And, if you look at US jurisprudence from the good 'ole days you'll find that industry, especially railroads, got a lot of breaks in the days before judges determined that industry was robust enough to pay for its mistakes. China, of course, has a heavy-handed criminal judiciary, but I'm hoping somebody's filing some torts on behalf of the, at least, 1,253 families in China that have suffered.

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I bring this to our readers as a public service, along with the warning that if you read either one while lying down, odds are you will fall asleep before you get to the second one. Anyway, I give you McCain and Obama, in their own words, on China, written for AmCham.

The summary of both is that China has done great things (duh!), still has a ways to go (duh!), and the US should cooperate, except where it does not make sense to do so (duh!). Yada, yada, yada.

One can hardly blame America for focusing more on Sarah Palin's glasses?

UPDATE: Check out China Rises for an in depth review of the China policies of McCain and Obama.

FURTHER UPDATE: Asia Logistics Wrap does an incredible job analyzing the positions of the two candidates on Asia, including China, in a post entitled, "US Presidential Candidates on Foreign Affairs/Trade with Northeast Asia."

FURTHER UPDATE: China Esquire weighs in and says that because of Obama's overheated rhetoric he thinks McCain is the better choice for those favoring improved US-China relations.

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Leave it to Fouad Ajami to put out the best article I have yet seen on the differences between McCain and Obama on foreign policy. Entitled, "The Foreign Policy Difference," it makes no claim as to which foreign policy framework is better, nor do I, but if you want to get to the heart of the very different ways in which McCain and Obama see America's role in the world, you should read this article.

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The Useless Tree has a very long, very thoughtful post on what constitutes Chinese and where China is going in terms of becoming a multicultural society. The post is entitled, "Can A Black Man Become Chinese?" and it is well worth a read.

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You have to check out Danwei's post, entitled, "It's not easy for a migrant worker in the legislature." I don't even want to tell you what it is about, because I see it being about so many things, some of which go well beyond China.

You just will have to trust me that this is a must read.

What do you think?

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China Comment has a nice piece up, entititled, "China and the American Election," analyzing which side (Obama/Biden vs. McCain/Palin) would be better for US-China relations and concludes McCain likely would be, by a slim margin.

What do you think?

NOTE: Silk Road International just came out with its own advice regarding the candidates' positions on China: don't believe "anything" you hear. Will Lewis over at Experience Not Logic, in a post entitled, "Obama's Acceptance Speech & China," calls himself an Obama supporter, but dissaproves of Obama's China comments at the Democratic convention, but notes that "this political race has greater implications than trade with China and I'm mostly willing to overlook what Obama is currently saying about China, and hope that it is still just campaign rhetoric."

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Black and White Cat does a great job showing how China's media sanitizes foreign media articles on China, in its post entitled, "How the New York Times (should have) covered the Olympics." I am "speechless" not because I am surprised (I am not), but because the post speaks volumes all by itself. Read it. (h/t to Peking Duck)

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Very good article on China Success Stories on why and how to sell and market in and to China. Article is written by Beijing-based advertising guru Dan Mintz and is entitled "Sagging Markets? Look To China: Wealthy Chinese consumers are ripe for the pitching, but approach with caution." Selling and marketing in China 101. Check it out.

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"If you want to make an omelet, you must be willing to break a few eggs." Vladmir Lenin

"Power tends to corrupt, and absolute power corrupts absolutely.." Lord Acton

Phillip Pan, former Washington Post Beijing bureau chief has written a great book on China, entitled, "Out of Mao's Shadow: The Struggle for the Soul of a New China." The book profiles 11 Chinese, mostly present day, and by doing so, it very nicely provides a not very pretty snapshot on China's political development.

Pan was in China from 2000 to 2007 and one gets the distinct impression he was working on many of these profiles the entire time. Pan clearly views the people of whom he writes as markers on where China is now and where it likely will be heading. Pan takes a decidedly pessimistic view of the party's ability to reform from within and is overall rather negative on the idea of China's growing economy automatically leading to a corresponding growth in the political arena.

I agree and I disagree. I too do not consider the party capable of instituting full on reform, but at the same time, I believe as China's economy continues to grow, continuing reform is inevitable.

The Washington Post, in an article entitled, Battle Lines: Portraits of people seeking, and resisting, change in China, accurately describes the book:

The 10 or so intersecting stories he tells here are gritty and real. This is not a big-theme book about the "true" China but a concrete, closely observed encounter with particular people, places and events.

* * * *

Yet some big truths emerge.

Read this book for its beautifully crafted and moving profiles of 11 individuals and to garner big truths about China.

UPDATE: Richard over at Peking Duck, the best China book reviewer on the blogosphere, just came out with an absolutely glowing review.

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Foreign Policy Magazine is out with a fascinating and very well done list of China's 10 worst laws (damn, why didn't I think of that). (h/t to Jeremiah over at Peking Duck)

I certainly agree with most of those on the list, but I hardly think it fair to put the New Property Rights Law on there. Here's what Foreign Policy has to say about it:

What it says: A first, this law granted the right to property ownership by private persons.

What it does: Although one can own buildings and fixtures on land, the land itself still belongs to the state. The Chinese government also has a right to seize private property for “a public purpose,” a vague standard that is often exploited by commercial interests. The state must “provide compensation” for such seizures, but it usually offers a menial amount. Some analysts think that giving peasants in particular the right to sell their land would have tamped down rural unrest and helped millions find work and overcome poverty, but such a dramatic step was apparently too much for the Communist Party.

Though this law is not perfect, it is a giant advancement for China.

For an in-depth examination of that law, check out the following:

Part I, Introduction, is here. Part II, General Principles, is here. Part III, Rules Of Real Property Ownership, is here. Part IV, Real Property Use Rights, is here.

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Nothing new here (near as I can tell), but nice collection of facts and figures regarding China's internet can be found on Trendspotting by going here. (h/t to China Venture News)

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As regular readers well know, I am not a big fan of predictions regarding China or its economy. Their overall accuracy is too low. But I am linking over to one now, entitled, "Chinese and Starbucks Late Stage Growth Obesity," for two reasons. First, I know the author, Vitaliy Katsenelson, and he is one smart dude. Second, it does a nice job of analyzing the situation. But while I agree with much of the analysis (though I sure as hell would not describe Singapore as a lower cost country than China!), I aggressively take absolutely no position on the conclusion: China's economy is going to fall and fall hard.

It does make for interesting reading.

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I wasn't going to do it, I swear. I had told myself not to say anything about the Olympics, figuring all those who are interested could watch it themselves, but Brendan O'Kane's post on it is just too damn funny and snarky (I am using that word for the first time on here just to seem hip) to pass up. I recommend you read it.

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Really excellent article by John Kamm over at the Washington Post, analyzing the reality behind the recent Pew Survey numbers on China. The article is entitled, "Blinded By the Firewall: Why the Chinese Think The World Loves China," and if you want to understand how China views itself and why, you should check it out.

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Too damn funny to pass up: Today's Doonesbury on Beijing (h/t to Boulder2Beijing)

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Very well done blog post over at MNBC's World blog on the current state of religion in China. The post is entitled, "Exuberance at One of Beijing's State-Sponsored Churches," and it is well worth a read. UPDATE: Just came across this China Herald post with a very interesting video setting out how the glass is still half empty.

Speaking of half full glasses, President Bush's deft handling of China and the Olympics has to go down as one of the few things he has done right on foreign policy.

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Simon Elegant has a great post up over at the Time China Blog, entitled, "A Reporter's Guide To Covering The Olympics." The post is a tongue in cheek guide on how to hit every cliché when reporting on China. Sadly, much of it does read almost line for line of what passes for coverage in so many Western publications. Fortunately, the entire Western daily press does not follow this guide and if you want coverage of China that consistently goes beyond this guide, I suggest you read the following newspapers:

1. Wall Street Journal;
2. Washington Post;
3. Financial Times;
4. New York Times. (though its headlines seem oftentimes tend to follow Elegant's guide).
5. The Times (Thanks FOARP)
6. The Guardian (Thanks FOARP, again)

Any others? FOARP has helped on the British side. What about Canada and/or Australia?

Oh, and one more thing, Beijing's air is that bad. Sorry.

UPDATE: Kaiser Kuo at Ogilvy China's Digital Watch does an absolutely masterful job listing the cliches reporters in Beijing would do well to avoid, in his post, entitled, "Forbidden Cliches: A Guide for Visiting Journalists." May we live in interesting times.

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China Business Blog and Podcast just did a post on a CNBC television appearance this morning by Technomic Asia's Steve Ganster. Because so many of my firm's clients are in the international food business and because I see China as a tremendous market for Western food companies, Steve's analysis is of particular interest to me.

The key takeaway from Steve's interview is this from the China Business Blog post:

As companies are learning that what works at home won’t necessarily work abroad in the Chinese marketplace, they’re finding new ways to cater specifically to the needs and desires of Chinese people — rather than shoe-horning American products into a distinctly non-American set of tastes.

Check it out.

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I am usually not interested in trying to divine whether or not China is going to become a superpower. My lack of interest stems both from the inherent vagueness of the term "superpower" and from the fact that all such predictions are based on today's facts, rather than on some supernatural ability to predict the future. Having thrown out these caveats, I have to admit there is a really interesting and thoughtful "debate" going on right now between John Pomfret (whose knowledge of China I greatly respect) and the China Comment blog (whose knowledge of China I also greatly respect.

Pomfret is in the China will not be a superpower corner, while China Comment says it will. Pomfret puts forth his views in a recent Washington Post article, entitled, "A Long Wait at the Gate to Greatness" and China Comment rebuts them in a post, entitled, "A Weak China?"

What I see as important is not so much their positions on the will it or won't it issue, but rather their excellent analysis of China's situation today and how that situation may shape its future. Greatly simplified, Pomfret and China Comment disagree on the following:

Demographics. Pomfret says China's demographic situation is dire. China Comment says China's labor force has plenty of room to expand.

The Economy. Pomfret says it is overrated. China Comment says look at purchasing power growth.

The Environment. Pomfret says it is bad. China Comment says it can improve.

Ideology. Pomfret says China has none. China Comment says China is in the process of developing its mission.

The glass is both half full and half empty and both are worth a read.

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+8* blog (a consistently interesting Asia/China tech blog written by Benjamin Joffe) just posted on Asian internet and mobile companies seeking to go global. The post is entitled "From Asia to the world: going global in a digital world," and it describes what it will take for Asia to go "global in a digital world." Great stuff for those interested in innovation or high-tech and I urge you to check it out.

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Okay, so I didn't really write this, but I have thought this so many times in my head that somehow my thoughts must have transferred nearly 1 to 1 to this post. The post is "Utter Idiots and Why the United States Will Not Boycott the Beijing Olympics" and with two very minor variations, it conveys my thinking, exactly. The two changes are that I would use a word weaker than idiot so as to offend a bit less and I am not as frustrated as the actual writer, Kai Pan. I also should credit Kai Pan for the history lesson regarding China's role in the 1984 Olympics; I have to admit I was not aware of that.

During my first year blogging, those who accused me of being a Panda licker or a China hater angered me. During my second year of blogging they frustrated me. I am now indifferent, figuring those who make such comments either know not whereof they speak or simply have not been reading this blog long enough to know our actual views. Once I achieved indifference, I realized the overwhelming majority of our readers (I would guess something close to 99%) do want to listen and debate, not just hurl invective. So the word "idiots" is not directed at any of you.

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Maybe I have been watching too much Lost (all that remains is the Season 4 finale), but in response to a barrage of demand (one email suggestion around a year ago), I have decided it is time I come out with my list of the five China blogs I would want to be able to read were I to be stranded on a deserted island for the next year or two. Now remember, this list is not meant to be the best five blogs or the most enjoyable five blogs or even the most important five blogs. It is a list of the five blogs I would want were I to be stranded without any other reading material. That all of these blogs have daily or near daily postings (oftentimes multiple postings per day) is a big plus as I figure I will have plenty of time to fill. It would be a cop out were I too list anything even resembling a blog aggregator (like Chinalyst or China Digital Times or Virtual Review China) so I will not.

So without further ado, and in no particular order, and with just a bit of explanation, here goes:

1. Peking Duck. Why? Because this blog best captures the zeitgeist of China's expat community. Plus, it is fun.

2. Danwei. Why? Because there is something worth reading on there every day and every week or so there is something on there that is completely original and of critical importance.

3. EastSouthWestNorth (a/k/a ESWN). Why? Because it tells exactly what is happening in China and when it really matters, it gets in depth with it.

4. Shanghaiist. Why? See Danwei explanation above.

5. ImageThief. Why? Because it deals with the big issues as well as anyone and the writing is just so damn good.

What do you think?

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Just came across a very interesting new blog, entitled, Mei-Zhong Guan-Xi (h/t to Danwei), which accurately describes itself as follows:

Analysis and translations published by an American living in Shanghai.

The goal of this site is twofold. First, through translations, allow non-Chinese speakers access to editorials in China’s domestic media in order to increase understanding of the Chinese viewpoint. Second, through analysis, express my own views on certain China-related issues.

On average, I will try to publish one translation each weekday, and one analysis piece each week.

Mei-Zhong Guanxi is Chinese for US-Sino relations.

All posts by Anton Lee Wishik II

Check it out.

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Fascinating discussion over at Blogging for China on what makes one Chinese. Post is entitled, "What Does it Mean to be Chinese," and it and its 161+ comments, unflinchingly address what is required to be Chinese.

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Well, within limits.

Bizcult has an interesting post up on the basics of lobbying the Chinese government. The post is entitled, "How to Lobby the Chinese Government," and it is based on Scott Kennedy's book The Business of Lobbying in China.

According to Kennedy, Chinese policy arises from three things:

1) bargaining between elite politicians and various bureaucracies, 2) expertise provided by intellectuals that include economists, lawyers and researchers in government-sponsored research institutes, 3) National People’s Congress legislation.

To lobby effectively, you need to concentrate on these three processes and the policies they create. Lobbying by foreigners is commonly done in China and the most successful lobbyists are those who communicate and make personal visits regularly. Kennedy has the following to say about where and how to lobby:

"Lobbying via Chinese trade associations can have mixed results." There are many such associations, but only some of them have any real power.

"Forget about the Communist Party." Kennedy sees the party as "unimportant" for business purposes and he suggests lobbying "the ministries and commissions responsible for daily management and regulation of business policy" where regulation actually occurs.

"Don’t cultivate clientelist relationships (read: don’t bribe bureaucrats)." Buying the influence of one local official probably will not help.

I agree with all of the above, particularly the point about constant contact with government officials. If you are going to impact Chinese governmental officials (and this is true of government officials outside China as well), the best way to do it is through a real relationship, not just by running to them with your latest immediate problem. Regular readers of this blog know our position on bribery is to just say no. No both because the person you bribe today may be out of power tomorrow and no because you could get caught and put in jail, either in China or in your home country.

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Or "nucular," as President Bush calls it.

China Comment (an excellent, relatively new blog) did a pretty amazing post, entitled, "China's Nuclear Power," detailing (and that is the right word) China's nuclear power industry. If you want to know about nuclear power in China, I recommend you read it.

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Very interesting and insightful article on skateboarding in China, dude. The article is written by college junior, Jonathan Chow, and is entitled, "Skateboarding With Chinese Characteristics." Its money quote and why the article itself is important is as follows:

"Forget soybeans, aircrafts, and pharmaceuticals. Popular culture is America's most influential export."

It's tagline is that "As extreme sports emerge in China, skateboarding leads the way." BTW, am I the only person over 25 who both watches and loves Rob & Big?

More than once, someone from Russia has told me that despite all the anti-American propaganda to which they were constantly subjected, they never hated the United States because they liked our music so much. I have a very close friend (the guy who sent me to Papua New Guinea, actually) from Sakhalin Island, Russia, who taught himself English by listening to US and British Rock & Roll on Japanese radio stations.

On a barely related note (I cannot resist the plug here), one of our gaming clients will this week be releasing an unbelievably cool video game based on the TV show, The Deadliest Catch. The game [check out the video at this Amazon link] involves crab fishing, but I mention it here because though crab catching is obviously a very serious business, the game itself plays more like an extreme sports game, which should be no surprise because the people behind it were also behind the award winning and hugely popular Greg Hastings Tournament Paintball MAX'D game.

It is a good article.

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Travelpod has the most comprehensive analysis of China's present visa situation I have seen (h/t to ImageThief). It explains the current situation with respect to all sorts of China visas. If you have any questions regarding what it takes these days to secure the various types of China visas, I urge you to check it out.

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Matthew Harrison of B2B International China has a nice post up on China Success Stories, entitled, "Marketing and Selling to Chinese Businesses." For me, the big takeaway (and surprise) was the importance of conferences and exhibitions. Now of course I knew that China puts a big one of these on just about every week, but I did not realize how truly important they are for securing business. I do not purport to be an expert in marketing to Western companies, but I have to believe such events are of far less importance than in China. Anyway, it makes for a very informative read.

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When two preeminent China techno-geeks (Kaiser Kuo at Ogilvy Digital Watch and David Wolf at Silicon Hutong) tell us we should be looking to newly created OpenWebAsia.com for sources on China and Asia tech, all I can do is listen and repeat.

OpenWebAsia describes itself as follows:

The OpenWeb.Asia Workgroup is a network of premium blogs focus on Asian Web industry. These sites build efficient channels between Asia web and global industry, and also enhance the inter-communication of local Internet markets. If you would like to subscribe to all of these blogs, you can download and import the OPML file into your favorite RSS reader.

Check it out.

While on the subject of excellent sites that "build efficient chanels," I also highly recommend Alltop.com, an excellent blog aggregator with a China section. Alltop is the brainchild of Guy Kawasaki, who himself has a great blog on tech and more.

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Mega consulting firm AT Kearney just came out with its 2008 Global Retail Development Index and China came out as the fourth most attractive country, behind India, Vietnam, and Russia. The report has all kinds of fascinating statistics, rankings and graphs and I would urge anyone either in or thinking of going into international retailing to check it out.

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Two excellent posts on Confucianism as THE ideology for China. The first, by Xujun Eberlein, writing at China Beat, is entitled, "China: Democracy, or Confucianism?" Greatly oversimplified, its thesis is, essentially, as follows:

It seems typical of American thinking to regard either a republic or parliamentary democracy as absolutely the only right model for all countries. For a political system to succeed, however, it needs to be rooted in the particular country's cultural history. Throughout thousands of years, China has never lacked great thinkers, political or philosophical. Which poses an interesting question: why does China need to adopt a Western model for its political system, be it Marxist communism or capitalist democracy?

Ms. Eberlein then goes on to call out Confucius as China's last great folk thinker in "quite some time."

Professor Crane over at The Useless Tree responds to Ms. Eberlein's post by, among other things, making three very strong points. The first point, and one on which I whole-heartedly agree, is that it is unfair and dismissive to refer to democracy as "simply a 'Western' thing":

Two things come to mind here, by way of critique. First, while it is true that certain institutions and practices of modern democratic politics can be said to have arisen and developed in something called "the West," it is not true that democracy is simply a "Western" thing. "West" is as problematic a construction as "East" or "Orient." It operates on too abstract a level of historical analysis to be very useful in analyzing and understanding political dynamics. And it is as politicized as any other such generalization. It is used by critics of democracy to link popular demands for more open and participatory politics with imperialism. It thus frames Chinese or Vietnamese or North Korean democrats as unpatriotic (I do not mean to suggest that his is Jiang Qing's intention; but the broader discourse of "The West" creates this effect). A further ramification of the use of "The West" is to distract attention away from historical and contemporary democratic practices in Asia (are Taiwanese not "Chinese"? Are Koreans not "Easterners"? Are Indians not "Asian"?) and also glosses over the history and current manifestations of anti-democracy in the "West." Overall, a high cost to pay intellectually for a fatuous over-generalization.

His second point is that China is too diverse and too globalized to become harnessed by a "singular state ideology:

Confucianism cannot serve as the singular state ideology because no system of thought or philosophy can so serve. Confucianism can provide us with a unique perspective on modern issues but it cannot capture the totality of modernity. Neither can socialism or liberalism (which is not, by the way, the "state ideology" of the US) or conservatism or whatever have you. Globalization, which brings constant movement of ideas and cultural practices, makes this even more impossible.

Why not democracy with Chinese characteristics?

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As regular readers know, China Law Blog loves the Danone-Wahaha dispute, having written the following posts on it:

-- China's Joint Venture Jeopardy
-- Danone v. Wahaha -- Which Of Us Is The Most China Rookie?
-- Danone and China's Wahaha: A Lecture on How (Not) to Make Allies Enemies
-- New York Times And Steve Dickinson On The Danone Wahaha China Dispute And On Avoiding Your Own
-- Danone v. Wahaha: China Business/Law Lessons To Be Learned
-- Danone vs. Wahaha. Danone vs. China Law Blog. Ogilvy vs. Steve Dickinson. Have I Missed Anyone?
-- Danone- Wahaha: An Update
-- China's Danone-Wahaha Fight -- The Law Journal Version

We love that dispute because within it lies just about every China business or business law issue one might confront. It is, as a lawyer friend of mine so succinctly put it, "China writ large." We are not the only ones with that view.

Jingzhou Tao, an attorney in JonesDay's Beijing office, and Edward Hillier, a JonesDay paralegal and loyal CLB reader, co-wrote a superb article on the Danone-Wahaha dispute for China Business Review, entitled, "A Tale of Two Companies." The article is appropriately subtitled: "The Danone-Wahaha partnership once seemed ideal, but the companies’ relationship has deteriorated. What lessons can be learned from the dispute?" Tao and Hillier see this dispute as illustrating "issues that foreign-invested enterprises may face in China and the direction of China’s development."

This article does a nice job of explaining the dispute, putting it into context, and putting forth lessons to be learned from it. It also does the best job yet in terms of listing out all of the cases around the world between the two warring companies. Who knew that in addition to cases in Sweden, France, Italy, California, China, and the British Virgin Islands, Danone and Wahaha also went at it against each other in the Samoan courts? I particularly liked the writers' sidebar of "Dispute Resolution Tips in China" (though I think they apply just about everywhere):

- Stay calm and do not get involved with personal invective. This will nearly always backfire in the PRC media.

- Say as little as possible about the dispute. Any comment can be counter-productive.

- Lobbying high-level government officials may not help resolve a dispute because it can give lower-level officials an excuse to do nothing.

- Any strategy must be carefully and pragmatically planned based on the circumstances of the dispute. There is no magic formula.

One thing I would add to this (and again, this is true everywhere, not just China), is that if you are in a litigation dispute that is being covered by the press, you must retain top quality outside public relations counsel. The company involved in the dispute is not going to be objective enough to handle the public relations' aspects (even if it has its own in-house public relations people) and we lawyers (despite thinking otherwise) are just not very good at it.

Do check it out and let us know what you think.

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Fascinating and insightful post over at Richard Spencer's blog, entitled, "When Corruption Works." The post posits that one of the reasons there were so many poorly constructed schools in Sichuan province is because there were so many schools and the reason there were so many schools was due, at least in part to corruption. Interesting analysis and well worth a read.

Post also talks about the long-held view of corruption in Asia, as opposed to in Africa:

Others who have studied these things in more detail have pointed out that, for better or worse, Chinese corruption has a distinguishing feature: because it is so long associated with bureaucratic control, local officials are rather successful at ensuring that corruption can be something of a win-win situation for all sides.

Take off too big a percentage of any given project to which you apply your government chop, and you discourage investment and growth: this is precisely what happens in too many less successful countries in Africa and Asia. Projects get run into the ground as the money supposed to pay for them gets siphoned off into foreign bank accounts.

Reminds me of the following parable:

An Asian and an African Minister of Infrastructure ... become friends during their conferences. The Asian minister invites to his home the African, who marvels at its beauty and asks how the Asian could afford it. “See that bridge over there?” said the Asian minister. “That’s right. 10%. 10%.” In the next year it is the Asian minister’s turn to visit the African and to marvel at his even more grandiose home. “See that bridge over there?” the African minister asks, and the Asian replies, “What bridge?” “That’s right,” the African answers, “100%. 100%.”

Anyway, do check it out.

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Brendan O'Kane is widely regarded as one of the brightest and best writers in the China blogosphere and I regularly check out his posts for their bon mots. Today, however, Brendan's post consists of a picture about which all I can do is repeat the by now trite phrase that a picture is worth a thousand words and urge you to go see it here.

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"Freedom's just another word for nothing left to lose."
Janis Joplin

Stupid Pig's China Blog has a very interesting post, entitled, "Freedom in China," on how the Chinese typically view the meaning of freedom differently than those in the West:

The west has generally perceived China to be a country without freedom. That’s why there’s always this talk about no human rights, police brutality, and government regulations over every little thing you do. When someone says this to a Chinese person, they would generally get a reply about how China is free and they never feel repressed.

So what gives? Is the west just stupid and know nothing about China or are the Chinese people brainwashed into believing that they are free?

I think the reason why there cannot be agreement between the two sides is because they’re talking about different types of freedoms. When the west criticizes China on this issue, they basically point to censorship, restrictions on public assembly, limited freedom of speech, and the repression of independent religious groups. However, when the Chinese people talk about the freedoms that they have, they’re thinking of how they can talk about whatever they want in the privacy of their own homes, how they can go out and walk around in the streets of Beijing at night without fear of getting killed, and the ability to go out and spend their money however they want.

Stupid Pig sees China's increasing wealth as eventually leading to greater "higher" freedoms and I agree.

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The always worthwhile China Beat has a great post up by Leslie T. Chang. Ms. Chang is a former WSJ reporter who just wrote a book called Factory Girls: From Village to City in a Changing China, due out in October. This post both previews the book and highlights the differences between writing for the Wall Street Journal and writing a book.

If these two paragraphs from the book are any indication, I expect the book will be riveting:

When you met a girl from another factory, you quickly took her measure. “What year are you?” you asked each other, as if speaking not of human beings but of the makes of cars. “How much a month? Including room and board? How much for overtime?” Then you might ask what province she was from. You never asked her name.

To have a true friend inside the factory was not easy. Girls slept twelve to a room, and in the tight confines of the dorm it was better to keep your secrets. Some girls joined the factory with borrowed ID cards and never told anyone their real names. Some spoke only to those from their home provinces, but that had risks: Gossip traveled quickly from factory to village, and when you went home every auntie and granny would know how much you made and how much you saved and whether you went out with boys.

The post certainly is.

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Whenever I come across a really good China blog that has been around for more than a few months, I get irritated. I get irritated at myself and at those who are supposed to be assisting me on this blog for not having discovered it sooner. I also get irritated at the Chinese blogosphere for not having linked over to it. The known is always easy.

I am irritated today because I just came across an excellent China-ish blog that has been around since late last year and, as far as I know, has yet to be cited. Whoops. I just ran a Google blog search and I see that my friend Richard over at Peking Duck beat me to it on this. Kudos to Richard for reducing my irritation a bit.

Inside-out China is written by Xujun Eberlein, who describes herself as follows:

Xujun Eberlein grew up in Chongqing, China, and moved to the United States in the summer of 1988. After receiving a Ph.D. from MIT in the spring of 1995, and winning an award for her dissertation, she joined a small but ambitious high tech company. On Thanksgiving 2003, she gave up tech for writing. She has since won many literary awards. Her stories and personal essays have been published in the United States, Canada, England, Kenya, and Hong Kong, in magazines such as AGNI, Walrus, PRISM International, StoryQuarterly, Stand and Kwani. Her debut story collection Apologies Forthcoming won the 2007 Tartt Fiction Award and will be published in May 2008. She hosts the literary and cultural blog Inside-out China.

She is the author of the recently published book, Apologies Forthcoming, which is described as follows:

Four decades ago China was embroiled in the Cultural Revolution, a period that turned the country on end and defined the generation of Chinese now coming to power. This collection of stories opens a different door to life during and after that time.

When I recommended Blogging for China just last week, I talked about the dearth of well written China blogs in English by those with a China perspective:

One of the things that has surprised me about this blog (China Law Blog) is how seldom people seek to take us to task on our blogroll. If I were a reader, I would have long ago complained about our failure to include China blogs with more of a Chinese perspective. My explanation is that I tend to be pretty intolerant of blogs that are not well written and, let's face it, it is very difficult to write well in a foreign language. Blogging for China is an exception in this regard because it is plenty well writtten. From whence do its writers come?

Inside-out China, though about way more than just China, is both insightful and well written and I have added it to our blogroll.

Just as an aside, Ms. Eberlein has a Chinese saying on her site that I just love: "As long as the green mountains remain, don't worry about firewood."

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Heart of Beijing has a good post up, discussing the changes the Sichuan earthquake has brought to China and, in particular, to how China views itself and how China views how outsiders view China. The post is entitled "Time's Cover Story," and it uses Time Magazine's article, entitled, "Helping Hands," as its springboard. Both the post and the article itself are well worth a read.

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Law Professor Donald Clarke, of Chinese Law Prof Blog fame, has compiled an extremely helpful compilation of views on the pros and cons of Westerners' securing an advanced law degree, or LLM, from a Chinese law school. The compilation can be found here (h/t to China Esquire).

What do you all think?

Along these same lines, Above the Law just did a post, entitled, "The Asia Chronicles: Picking a Firm," describing what to look for in an Asian international law firm at which to work.

UPDATE: Stan Abrams over at China Hearsay has just weighed in with what sounds to me like excellent advice regarding Chinese LLMs, in a post entitled, "The Value of a China LLM."

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My friend and fellow Grinnell alum, “Sunny” Seong-hyon Lee emailed me the other day to express his regrets for having been out of both Beijing and Seoul (where he usually is) when I was in both cities last month. More correspondence revealed he had just returned from Chengdu. Sunny wrote an amazing account of what he saw there for Harvard Magazine, (where he got his masters degree) The article is entitled "Hope amid destruction in Chengdu," and though I am sure most of you have already read countless articles on the quake, I urge you to read one more.

Much of the article chronicles what Sunny sees at a makeshift hospital for new and expectant mothers, but it also veers off into discussing the politics:

One reason why the Chinese government has proactively provided candid disaster information and allowed media access to the site is to prevent unfounded rumors from wreaking even more havoc, a taxi driver, Mr. Liu, explains. “Besides, this is such a big disaster that people will find out about it sooner or later. If you suppress information, rumors will be rampant,” he says. “Besides, given the massive financial loss here, the government will need to turn to the public to raise money,” he says.

Overall, Mr. Liu gives the government high marks for its disaster response. “Premier Wen Jiabao rushed to the disaster-stricken sites early on to oversee rescue efforts. That was a good move,” he says. “The radio is also doing a good job of providing information 24 hours a day. Yesterday, I was listening to FM 91.4 and the radio announcer kept talking for more than four hours straight in the evening. I am sure she didn’t have dinner. It was touching.”

By the time the taxi arrives at Xinhua Park, a voice on the radio says: “Dear comrades, please don’t panic. Please don’t listen to groundless rumors. Trust what the government says.”

Check it out.

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New blog out there of which CLB readers should be aware. It's called Blogging for China and it usually takes a decidedly pro-China view on most issues.

Though pro-China, it is not at all ridiculously so and that means it puts forth very well reasoned and thoughtful arguments and is duly respectful of opposing viewpoints. Pro-China, but not strident or jingoistic.

In particular, it has written often and well on T1b*t, and I particularly urge anyone who thinks this is a simple issue to read those posts. Blogging is at its best when it creates a true marketplace of ideas and, without exception, all the top China bloggers who take on the tough issues (blogs like The Peking Duck, Image Thief, Danwei, Shanghaiist, China Hearsay, Cup of Cha, Mutant Palm, and Zhongnanhai succeed both because they strongly express their own views and because they are respectful of (and I suspect even sometimes impressed with) the views of those with whom they diverge. Though none of these blogs are lacking in forceful opinions, their strength comes from focusing on quality and import, not on relentlessly pounding out an ideology.

The bloggers for whom I have no time are those who believe they have a lock on the truth and any deviation from their truth is an abomination. I will refrain from mentioning those blogs because the last thing I want to do is drive traffic to them, particularly since, as far as I can tell, none of them get more than a few viewers a day, and (judging by the comments) those few viewers seem to consist of the already anointed. These are the blogs written by "ends justify the means" type zealots who purport to have the answer to every question regarding China and believe any blogger who does not enthusiastically toe their line on every single China issue deserves vilification. To quote Ali G. "There is so little respek in the world that if you look it up in the dictionary, then it's not even there."

One of the things that has surprised me about this blog (China Law Blog) is how seldom people seek to take us to task on our blogroll. If I were a reader, I would have long ago complained about our failure to include China blogs with more of a Chinese perspective. My explanation is that I tend to be pretty intolerant of blogs that are not well written and, let's face it, it is very difficult to write well in a foreign language. Blogging for China is an exception in this regard because it is plenty well writtten. From whence do its writers come?

Do check it out and let us know what you think.

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China Financial Markets (a very serious and numbers oriented China economics blog) has a fascinating post, entitled, "Demographic projections and trade implications," on the interaction between China's birth rate and age demographics and its economic and trade future. Marketers and futurists ought to be able to have a field day with this information and I urge anyone interested in these topics to check it out.

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Cn Reviews has the most comprehensive guide for donations to earthquake victims I have seen. (h/t to Black and White Cat) The post is entitled, "China Earthquake Donation Guide: 24+ ways to give," and it lists more than 24 charities involved with the China earthquake, along with descriptions and links. It is all very impressive and for those interested in assisting, I urge you to check it out.

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Uber reporter Tim Johnson over at his perennially superb China Rises Blog has a post up entitled, "China By The Numbers," which consists nearly entirely of a list of interesting numbers from this Independent article highlighting China's rapid change. Both the post and the full article are well worth a read, particularly if you are a numbers geek like me.

What's the deal with The Independent anyway? I don't remember noticing it until a year or so ago and now I am finding all kinds of interesting China and non-China articles in it?

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US Public Broadcasting Service (PBS) did a pretty good (though somewhat bombastic as is PBS's wont) series a while back, entitled, "China From the Inside." For those of you who did not have access to it or missed it, All Roads Lead to China just put up (via YouTube) the episode on China's environment. Nothing terribly new or earth shattering in it, but it does do a really good job in bringing China's environment to life, in a way television can and should. Go here to watch it.

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China Daily has an article that nicely summarizes the evolution of China's environmental laws, entitled, "A Legal Leap Forward." Makes for a good primer on the basics. (h/t to The Green Leap Forward).

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Very good Washington Post article by very good WaPo reporter Ariana Eunjung Cha on the impact of China's new labor contract law. The article is entitled "New Law Gives Chinese Workers Power, Gives Businesses Nightmares" and it presents a fair and balanced view of what this new law is doing to the employer-employee relationship in China. (h/t to Thomas P.M. Barnett)

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This Washington Monthly article, entitled, "Confessions of a Sweatshop Inspector" does a really good job conveying what really goes on in China's factories. (h/t to All Roads Lead to China) I admit to having spent very little time in Chinese factories, but this article certainly jibes with what I have been told by those who have and with what I have read on the subject. If you are outsourcing product manufacturing to China, it would behoove you to read this article.

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Every so often I will get an email from an English teacher in China who is owed money by the school for which he works. Typically the letter will state the case and then ask "do I have a case." I nearly always answer by saying that "based on the facts you have conveyed to me, it certainly does sound as though you have a case," but you really need to ask yourself whether it is worth your time and money and all the hassle and stress to pursue your case for $300 to $700. These emails are the sum total of what I know about teaching in China.

Despite this, I every once in a while also get emails from people asking me what I think about teaching English in China. I respond to these by saying that I think it is a good thing for everyone to learn English. Next time I will also mention this post, "Teaching English in China," on the Stupid Pig's China Blog because it is the only thing on the web of which I am aware that talks about teaching English in China. If you are interested in teaching English in China, please do not email me, just check out this post.

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Kevin Brown has a post up on the OpenDemocracy site that is either brilliant or completely tongue in cheek and I am too dense to tell which. Anyway, the post is entitled, "China's Olympics -- the lull after the storm," and it posits that China has been doing a heckuva good job with Olympics public relations by following the basic PR rule of getting the bad news out first. Brown sees the Olympics running smoothly from here on out and the Chinese just kicking back and enjoying it.

I vacillate between thinking Brown is dead on and thinking he has lost his mind. What do you think?

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Second year SMU law student, Jing "Brad" Luo, recently had an article of his on China lawyer ethics published in China Law & Practice Magazine. A law student getting an article published in such a prestigious magazine (in his second language, no less) is really quite a feat. The article is entitled, "Chinese Law on Lawyers Amended: Progress Made and to Be Made," and though a subscription is required to see the whole article on the China Law & Practice site, Brad nicely summarizes it on his own blog, with a post, entitled, "Legal Ethics, In Chinese Style."

My gross summary of Brad's summary is that China's new ethical rules for lawyers expand a bit on both the scope of confidentiality of client information and on what constitutes a conflict of interest, but on neither front have the rules gone far enough to make Western clients feel terribly comfortable. I previously wrote on why this discomfort is necessary in a post, entitled, "China Lawyer Ethics -- Perils And Pitfalls For Foreign Companies," which post, in turn, was based on two of Brad's previous posts (here and here) on China lawyer ethics.

Now I know you non-lawyers (if you have even gotten this far) are thinking that none of this has anything to do with you, you are going to just have to trust me that if you have ever hired a Chinese lawyer or law firm or are even contemplating doing so, you need to read the above posts.

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Professor Donald C. Clarke of George Washington University Law School (a former law school professor of CLB's own Steve Dickinson and the prof behind the Chinese Law Prof Blog) recently had his paper published, entitled, "China: Creating a Legal System for a Market Economy."

The abstract describes the paper as follows:

Since the early 1990s, China has come a long way in legislating the foundational rules for its reformed economy. Virtually all of the important areas-contracts, business organizations, securities, bankruptcy, and secured transactions, to name a few - are now covered by national legislation as well as lower-level regulations. Yet an important feature of a legal structure suited to a market economy is missing: the ability of the system to generate from below solutions to problems not adequately dealt with by existing legislation. The top-down model that has dominated Chinese law reform efforts to date can only do so much. What is needed now is a more welcoming attitude to market-generated solutions to the gaps and other problems that will invariably exist in legislation. The state's distrust of civil-society institutions and other bottom-up initiatives suggests, however, that this different approach will not come easily.

Professor Clarke is absolutely right. China has come a long way in passing a whole slew of really well crafted business laws, but once these laws get enacted, Beijing so often becomes paralyzed and cannot seem to come out with regulations fast enough to tell those of us in the field how we are actually supposed to work within the "big laws." So instead of businesses knowing exactly what they need to do to comply, they are oftentimes left wondering when the regulations will come out and what exactly they will say. This is absolutely typical of nearly every law referenced in the abstract above and is true of the new labor law as well. In other words, "what is needed now is a more welcoming attitude to market-generated solutions to the gaps and other problems that will invariably exist in legislation."

Professor Clarke's article makes for very interesting reading.

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Craig Maginness at the Going Global Blog has an extremely thoughtful post up analyzing the global trade positions of Hillary Clinton, John McCain, and Barrack Obama, entitled, "Presidential Primary Edition -- The Candidates, the Parties and Their Positions on Global Trade." His somewhat upbeat conclusion:

Fortunately, each of the 3 remaining serious candidates seem to be bright worldly people. I have to believe that whatever they may say in the nominating process to appeal to their party's extremes, when faced with the responsibility of leading the free world, they will recognize the benefits to the US of being fully engaged in international commerce and global competition.

Check it out.

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The Foundation for Law, Justice and Society has come out with a report (free online here) entitled, Regulating Enterprise: The Regulatory Impact on Doing Business in China. (h/t to AsiaBizBlog)

The report is described as follows:

This special report adopts an interdisciplinary, socio-legal approach to reveal the actual encounter between law and the social environment, exploring problems of implementation, and the implications for China’s future policy initiatives and economic development. Collectively, the briefs demonstrate that while China’s transition to a market economy governed by the rule of law is far from complete, the dynamic reform process is, on the whole, producing a more secure and transparent environment for investment.

It consists of the following chapters, written by the following people:

Introduction: Randall Peerenboom

Enforcement of Intellectual Property Rights
Policy Brief 1: Andrew Mertha

Recent Policy Changes in China’s Real Estate Sector
Policy Brief 2: Lou Jianbo

The Making of China’s Corporate Bankruptcy Law
Policy Brief 3: Terence C. Halliday

Competition Policy and Law
Policy Brief 4: Mark Williams

Development of a Legal and Policy Framework on Competition
Policy Brief 5: Peng Xiaohua

Labour Law: Trends and Practices in China
Policy Brief 6: James Zimmerman

Courts as Legislators
Policy Brief 7: Randall Peerenboom

The Impact of the World Trade Organization on the Chinese Legal System

Policy Brief 8: Yuka Kobayashi

The Foundation has also come out with a report entitled, Developments in Dispute Resolution in China, which can be found here, described as follows:

There have been dramatic changes in the nature and incidence of disputes, conflicts, and social disturbances, and the mechanisms for addressing them over the last twenty-five years in China. Drawing on recent empirical work, these policy briefs and reports examine the ways conflicts are addressed across a range of public and private fora, while exploring the development and limitations of mechanisms that seek to address citizen complaints and concerns. The briefs shed light on ongoing debates concerning the role of law and dispute resolution with respect to economic development (efficiency) and social justice (equity), and provide feasible policy recommendations for enhancing both justice and efficiency.

This report consists of the following:

Dispute Resolution in China: Patterns, Causes and Prognosis Report: Randall Peerenboom and He Xin

Constitutional Conflict and the Role of the NPC
Policy Brief 1: Wang Zhenmin

China Labour Dispute Resolution
Policy Brief 2: Ron Brown

The Enforcement of Commercial Judgments in China
Policy Brief 3: He Xin

Shareholders' Litigation and Anti-Dumping Investigation in China
Policy Brief 4: Wang Jiangyu

CIETAC as a Forum for Resolving Business Disputes
Policy Brief 5: Cao Lijun

Popular Attitudes Towards Dispute Processing in Urban and Rural China
Policy Brief 6: Ethan Michelson

I confess I have yet to read either book, but because both are written by such highly regarded China law scholars, I have no doubt both will be well worth the read. I fully intend to read both books, but in the meantime, I would love to hear back from anyone who reads either.

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The One Eyed Panda attended AmCham's very recent seminar on China visas and he left with a whole slew of good notes. So if you are wondering about the latest regarding China visas, I urge you to go his post, China Visa Update as it is very helpful. Note that the word is that this "new" system is going to remain in place even after the Olympics. In other words, if you want to make sure you can stay in China for business, you need a Z visa. For more on Z visas, check out, "China Visa Certainty: Z (employee) Visas Are Z Best."

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Go ahead and call me a Luddite, but I generally am not a big fan of podcasts because they take too long. We lawyers can read (or skim) documents at a much faster speed than mere mortals. Podcasts take away that edge.

But for those who like podcasts....

Rick Martin over at The Little Red Blog just compiled a great list on the top China podcasting sites, entitled, "China in your ear."

Rick's list consists of the following:

The Cool Aid, which describes itself as being about "surprising personal experiences in China business." Cool Aid is part of BizCult, which is a very good blog.

CBC Search Engine. CBC is the Canadian Broadcasting Corporation and this show is about "how technology is affecting society, and understandably, the conversation often includes a discussion of China."

The China Business Network. This one is excellent.

Danwei.fm. This one is part of the rightfully venerated Danwei blogging empire.

MarketPlace Public Radio. Rick advises us to "see its Asia category, which is dominated by stories on China." Scott Teng, npr's lead guy in Shanghai does always keep it interesting.

China Business Blog and Podcast. This is done by Kent Kedl of Technomic Asia and I too am a huge fan.

Any others deserving mention?

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The China Economic Review is just out with an article by CLB's own Steve Dickinson on the wholesale changes China has made to its VAT (Value Added Tax) system. The article is entitled, "VAT’s all folks: How changes in the tax system reflect an evolving approach to foreign investment." The article is on how China has changed its VAT rebate system to bring it in line with its policy of encouring higher value, lower pollution, industries, or as Steve puts it,“quality not quantity.”

Check it out.

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Until a few weeks ago, I actually thought there was little need for a blog focused solely on the upcoming Olympics. Silly me. For those seeking a one stop blog on China's Olympics, I heartily recommend the Beijing Olympics Blog, which describes itself as "An unofficial look at China & the Beijing Olympic Games." It is nicely done and, hey, it has even become somewhat relevant.

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There is so much great stuff out there on the Olympics; I could devote the next few months to nothing but that on this blog. Though I have studiously sought to avoid covering these issues too often, I could not resist saying something about this post on Shanghai Scrap, entitled, "The Protests, the Olympics, and Race." It is damn good and it is hugely thought provoking.

So what do you think? The comment lines are open, but please confine yourself to commenting on the issues raised in the article itself.

I will start it off by saying I am troubled by how quickly people are willing to just write off 1. 3 billion people as "brainwashed" and I think that is ignorance at best, racism at worst.

I will be getting on a long airplane flight shortly so please be patient in waiting for your comments to appear.

UPDATE: Just came across another "damn good" and "thought provoking" piece along these same lines. This one is by Brendan O'Neill on his personal blog and it is entitled, "Invasion of the robotic thugs," with this explanatory byline: "The attacks on the 'horrible, ominous, retarded' Chinese men guarding the Olympic flame are historical prejudice repeated as farce."

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You want to know the reality about the evolution of human rights in China? Go here.

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I hate the title, "Ten Reasons Why China Matters to You," and I also think some of the ten were tossed out just to get to ten.

But because Thomas P.M. Barnett is one of the best international strategists out there, and because the analysis behind the items is so good, I am recommending you check out this list on Good Magazine (h/t to Thomas P.M. Barnett :: Weblog)

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The force behind the Sun Bin blog has been to the big city in T1be*t and he is putting up some very good writing on his trip. Not that I should have to say this, but on this topic I fear I do, but my saying he has some very good writing does not mean I agree or disagree with any particular percentage of it, just that I find it thoughtful and informative.

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As a huge fan of John Pomfret, based on his excellent book, Chinese Lessons (for my review of that book, go to my post not so subtly entitled, "John Pomfret's Chinese Lessons -- LOVED IT!"), I was happy to learn from Danwei that Pomfret is just starting a blog on China for the Washington Post. It took all of two posts for him to come out with a big money quote that I have to repeat. The quote is from the post, "Don't Expect Protests to Hurt Chinese Regime," regarding the impact of foreigners putting the heat on China for its conduct in THAT Western Region getting so much press lately:

So is this going to weaken China’s government? On the contrary. The more pressure the Chinese get from foreigners and barbarians – which are actually synonymous in ancient Chinese – the stronger the system becomes. Indeed, China’s system feeds off this kind of adversity. The Communist regime has a peculiar genius for turning these types of threats into opportunities.

He is, of course, absolutely right and this is pretty much what I said when interviewed a few weeks back on BBC Radio. If the goal is to effect positive change in China, back channel diplomacy is the way to go. Do you agree?

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Joe Nocera of the New York Times just did an article, entitled, "Seeing the Sights of Industrial China: 2 Factories, 2 Futures," contrasting a textile factory with a manufacturer of silicon wafers for use in solar panels. The textile manufacturer is sinking fast due to the rising Yuan, rising labor costs, and China's policy of "moving up the value chain. This is in direct contrast to the silicon wafer manufacturer for whom these factors either do not much matter or are actually a plus.

I do not see China just deciding to "move up the value chain" and then getting there six months from now, but this article does on a micro level nicely describe what is happening in China manufacturing.

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My knowledge of currency hedging is based mostly on the following:

1. I am right now wearing a Swiss watch I bought in Korea at the height of the 1997 Asian crash. When I bought it, I was getting about 2000 Korean Won to the Dollar and Korea's economy was in such bad shape, the Jeweler sold it to me for half the regular Won price. I took it to a jeweler in Seattle to get a link taken out of the band and the jeweler told me that what I had paid for the watch with the band was less than they charged for the band alone.

2. Much of my firm's growth over the last six months has come from European companies retaining us to handle their legal needs in China and elswhere in Asia and from Asian companies coming into the United States, mostly to buy up American companies and properties. I am always saying these companies "laugh at" our fees because they are so low in comparison to what they pay their lawyers in countries with a stronger currency.

3. I have seen countless clients both get burned and make fortunes from currency valuation shifts. Changes in currency values can determine whether a business deal is profitable or not.

4. It is always a good idea to be clear on the currency in your contracts. Many years ago a client came to us for assistance in collecting on a contract our client claimed was in US dollars and the other side claimed was in Hong Kong dollars. Big difference.

This is all just a rather long preface to a very short point. CNReviews.com just came out with an excellent and very thorough internet review, entitled, "Links: RMB appreciation and the emergence of a new Asian reserve currency," on where the dollar/Yuan exchange rate is going and what businesses can and should be doing about it. The post warns that it is "another long post on RMB appreciation that will be boring for those not interested in this topic," but I see it as full of helpful links and I urge those who deal with Yuan Dollar exchange issues to check it out.

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Great post up over at Jeremy Gordon's China Business Services Blog on the reality Best Buy has been facing in trying to bring its retail concept into China. If you are thinking of bringing your retail business into China, read Jeremy's post, entitled, "Retail Reality." It concludes with two oft-heard tips on doing business in China, but two points well worth reiterating:

-- government policy and regulation can change quickly, with a big impact on business

-- board level support from HQ is a must

Check it out.

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All work and no play makes Jack a dull boy.

Check out this article in the China Daily, entitled, "http://www.chinadaily.com.cn/opinion/2008-02/15/content_6458887.htmMental Health Master Plan," on the stress China's children face from parents who want them studying constantly and reading only that which is prescribed by adults (h/t One-Eyed Panda's Journal).

This has to impact innovation/independent thinking, don't you think?

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Though I know very little about marketing (and even less about marketing to China's consumers), I know enough to know that Mastercard's "Brand Preference of the Chinese Affluent"[pdf] is chock full of helpful information and -- by extention -- great insight into the Chinese consumer. If you are selling a product or service in China or thinking of doing so, I urge you to read this report.

My main takeaways from the Mastercard report are the following:

1. Affluent Chinese consumers prefer foreign brands because they see them as an assurance of quality.

2. Affluent Chinese will buy Chinese brands with good reputations (e.g. Haier, Lenovo)

3. Affluent Chinese seem surprisingly free of nationalist sentiment when it comes to choosing their favorite brands.

4. Affluent Chinese rank their favorite wines in the following order: French, Italian, Spanish, Chinese, Australian, German. Noticeably absent are American wines, lending credence to my theory that American wineries are being far too reticent about going into China and are on the verge of missing out on China's rising wine consumption.

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Time Magazine's Shanghai correspondent, Bill Powell, (also of Time's China Blog) did a great story, entitled, "The Short March," on his family's move to a Shanghai suburb (h/t to The Yuan Also Rises). Good article on the suburbanization of China, but even better article on how growth affects China and on why continued growth is so necessary.

My favorite paragraph:

And that's where the simple comparison to the U.S. after 1945 breaks down. Journalist turned businessman Jim McGregor, one of the most astute observers of modern China, says that the country is cramming three different eras of U.S. history into one. In U.S. terms, the postwar prosperity that fueled the flight to the suburbs is happening at the same time as the 19th century Industrial Revolution that lured people from the farm to the cities, and also as Progressive Era efforts to rein in the worst abuses of capitalism take shape. I asked Guo if he agreed. He nodded, but added a caveat: "What's different about China is the sheer scale of things. The simple fact is there are still 800-900 million people living in poor, agricultural provinces. That's about three times the population of the United States."

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Nothing earth shattering or even new in this article, but "Dealmaking in China: Getting In on the Action," by George D. Martin at Faegre & Benson LLP and Dave Sampsell, associate general counsel at ADC Telecommunications, Inc., does an excellent job setting out where mergers and acquisitions (M&A) will be going in China and on the basics of doing one.

A gross summarization of this article (and of the advice we give our own clients) is that the basic questions to ask (due diligence) when doing a China acquisition are really not much different from those asked in a domestic US deal. The difficult and distinctive part comes in finding the answers.

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Paul Denlinger (of China Vortex) just did a guest review of the book, Managing the Dragon, on Lost Loawai, which book I glowingly reviewed last week, in my post, "Managing The Dragon. The Best, Jerry. The Best." Paul provides some excellent insights on the book that are very much applicable to doing business in China today.

Paul sets out the following list of things that "come through in the book":

● He [the book's author, Jack Perkowski] was keenly aware that there were different ways to do things in China, and he did not try to force down only one vision “because that’s the way that it’s done in America”

● He did not try to negotiate from a superior position, but instead negotiated as an equal partner committed to China’s long-term growth.

● He has a curious mind and is always willing to learn.

● He and his family now live happily in China, which in the eyes of the Chinese government and many Chinese, shows his commitment to the country’s development.

● He was keenly aware that there were different ways to do things in China, and he did not try to force down only one vision “because that’s the way that it’s done in America.”

Yes, yes, yes, yes, and yes. One of the things I have learned in my many years of international law practice is that those who succeed internationally typically have a certain mentality. If I had to pick one word to describe those who succeed (as opposed to those who do not), that word would be curiosity. Those who succeed are more curious than judgmental. They want to know how things are done in the foreign country and they want to fully understand it. Only then do they start analyzing and judging. The unsuccessful businessperson instantly deems the foreign way inferior before really taking it all in.

Paul rightly states that "Perkowski shows that China is really not that mysterious, but it takes time to learn and understand how it works. If one is willing to make that investment, then one day, you will get a good return on your investment." Paul then issues a few relevant caveats against expropriating Perkowski's strategies wholesale:

If there is only one warning I would make, it is that many of the strategies and scenarios Perkowski outlines work well with highly capitalized manufacturing businesses. He had an advantage in dealing with Chinese officials because he had $150 million to invest. For smaller investors say, in the service sector, it would be quite different. Also, after joining the WTO in 2001, Chinese regulations have opened up considerably for non-Chinese investors. As for joint ventures, very few companies consider them anymore, so they are mostly off the table.

Yes again. Paul is right to note how Perkowski had enough capital to garner the assistance of Chinese officials and many small companies going into China simply do not. Paul is also right to note how very few companies consider joint venturing today, simply because WTO has made it so that entity structure is required much less often. However, I will note that Perkowski himself counseled against joint ventures in most situations.

UPDATE: ThinkChina just came out with a very positive review of the book as well.

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Brilliant and insightful (two different words that still seem redundant) piece by Robert Kagan on how despite its gloss of modernity, entitled, "Behind the 'Modern' China." (h/t to China Digital) China is still rife with "19th-century" ideas:

China can go for great stretches these days looking like the model of a postmodern, 21st-century power. Visitors to Shanghai see soaring skyscrapers and a booming economy. Conference-goers at Davos and other international confabs see sophisticated Chinese diplomats talking about "win-win" instead of "zero-sum." Western leaders meet their Chinese counterparts and see earnest technocrats trying to avoid the many pitfalls on the path to economic modernization.

But occasionally the mask slips, and the other side of China is revealed. For China is also a 19th-century power, filled with nationalist pride, ambitions and resentments; consumed with questions of territorial sovereignty; hanging on repressively to old conquered lands in its interior; and threatening war against a small island country off its coast.

Kagan goes on to say these 19th-century elements of China "does not seem to change," even as China becomes wealthier:

But can a determinedly autocratic government really join a liberal international order? Can a nation with a 19th-century soul enter a 21st-century system? Some China watchers imagine the nations of East Asia gradually becoming a kind of European Union-style international entity, with China, presumably, in the role of Germany. But does the German government treat dissent the way China does, and could the European Union exist if it did?

China, after all, is not the only country dealing with restless, ind*p-nd*ce-minded peoples. In Europe, all kinds of subnational movements aspire to greater a*t*n-my or even ind*p-nd*ce from their national governments, and with less justification than ... [THE Western Region] or Taiwan: the Catalans in Spain, for instance, or the Flemish in Belgium, or even the Scots in the United Kingdom. Yet no war threatens in Barcelona, no troops are sent to Antwerp and no one clears the international press out of Edinburgh. But that is the difference between a 21st-century postmodern mentality and a nation still fighting battles for empire and prestige left over from a distant past.

These days, China watchers talk about it becoming a "responsible stakeholder" in the international system. But perhaps we should not expect too much. The interests of the world's autocracies are not the same as those of the democracies. We want to make the world safe for democracy. They want to make the world safe, if not for all autocracies at least for their own. People talk about how pragmatic Chinese rulers are, but like all autocrats what they are most pragmatic about is keeping themselves in power. We may want to keep that in mind as we try to bring them into our liberal international order.

Kagan is dead on in his descriptions of modern day China, but he cheats us by ending his article without telling us what all this means. Does Kagan believe that in light of the above, the West should just walk away from China? Does Kagan believe China will never become "postmodern?"

I think Kagan is wrong on two implicit points. First I think China is making progress, just not as quickly as most would like nor as quickly as most of us thought it would. I am not prepared to write China off. It took (and is still taking) Korea and Japan a long time to become "postmodern" (Kagan's term, not mine). And in hindsight, whatever made us think China would get there so quickly?

Second, I think Kagan is wrong to think any country is "postmodern" (again, Kagan's term, not mine). As much I would like to believe the European Union is capable of relinquishing the nationalistic tendencies of its nation-states, I think that experiment is far too new for us to conclude that has been accomplished. I also think Kagan is wrong to assume that the Chinese technocrats preaching "win-win" are not "postmodern." Is it not possible that, just as is true in the United States and in Europe, there are some who are "postmodern" (whatever the hell that really means) and some who are not?

China is getting there. Be patient. Very patient.

UPDATE: For one of the reasons this will take such a long time, check out this post, "The De-flowering of a Chinese Patriot."

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Interesting article in Business Week (h/t to China Challenges) entitled, "World Sneezes, China's Just Fine: Economists say a global slowdown will largely spare a mainland economy still based on domestic consumption and cushioned by vast cash reserves." Article says much of China's economic growth comes from increasing domestic consumption, which will not be much influenced by slowdowns elsewhere. Most interesting to me though was that the article says the whole notion of China's economy "de-coupling" from the worldwide economy is a misnomer as China was never all that "coupled" in the first place.

It is well worth a read.

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ImageThief seems to have recovered fully from a recent bout of spousal childbirth and has been churning out great post after great post of late, rising today to the level of profundity in analyzing the gulf of expectations surrounding the upcoming Olympics:

This extremely gloomy scenario made me think a little about the vast gulf between foreign and Chinese expectations for what the Beijing Olympics would accomplish. The Chinese expected the Olympics to change foreign perceptions of China for the better. Foreigners expected the Olympics to change China for the better.

In fact, these are both attainable goals, but they are interdependent. They will either both be right, or both be wrong. It doesn't work any other way. The unfortunate thing is that if both are wrong, especially along the lines sketched out by Ozanian, the Olympics will have achieved the opposite of what each party had hoped for. That would be a tragedy, and I hope for a better outcome.

The full post can be found here.

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When something big happens somewhere in the world, my first instinct is to seek to learn more by looking at what was written before it happened. I have been reading up on two things this weekend, Barack Obama's long standing and close relationship with the pastor he refers to as his "mentor" and recent "incidents" in China's Western region. I learned a considerable amount about "the feelings" surrounding you know what by reading a 1999 article written by Peter Hessler (he of Oracle Bones and River Town fame) (h/t to Crossing Cultures blog).

Hessler's article is described as follows:

Many Chinese working in ... [this region] regard themselves as idealistic missionaries of progress, rejecting the Western idea of them as agents of cultural imperialism. In truth, they are inescapably both.

Part 1 is here, Part 2 is here, and Part 3 is here. A very thoughtful and very sad read. Definite analogies to Bury My Heart at Wounded Knee.

Please be forewarned that I am going to be very careful about the comments. I am going to be much more discerning about what I keep and I also am reserving the right to make changes, as necessary. I want to keep this blog online in China.

Go here for more.

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Interesting post on the Seeking Alpha blog, by Steve Christ, entitled, "Why It's Not Too Late to Short China." Grossly simplified, it says inflation is doing in China's economy and it is not too late to profit from this by shorting China stocks. The way to short China stocks is to buy the UltraShort FTSE/Xinhua China 25 Proshare ETF, listed on the AMEX exchange under the symbol FXP, which has done very well indeed over the last few weeks.

Interesting idea. What do you think?

Full disclosure: I have no position in this fund, but I am seriously thinking of getting one.

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When we started China Law Blog more than two years ago, there was really only one other China law blog: Chinese Law Prof Blog, written by Professor Donald Clarke. Now, in addition to the two of us, the China Law Blogosphere now also includes the following English language blogs by foreign lawyers and law students, in roughly descending order of seniority:

1. China Hearsay, by Stan Abrams. My humble apologies for having forgotten this one initially, which is pretty inexcusable on at least three counts: One, this is a great blog. Two, this blog, if you count a long hiatus, has been around longer than just about any China law blog, including CLB. And Three, I consider Stan a friend. China Hearsay tends to focus on China IP and big think trade issues.

2. IP Dragon. Just as its name implies, this blog focuses on China intellectual property law issues. IT does a very good job.

3. Chinese Law and Politics Blog, by Carl Minzer, a Chinese Law professor at Washington University. This blog focuses on macro law issues, mostly involving politics and governance.

4. China Business Law Blog, by Brad Luo, who describes himself as "a law student at Southern Methodist University.... [whose legal interests] include U.S. & Chinese franchise regulations, foreign investment in China, international trade compliance, intellectual property protection, transnational transactions and international dispute resolution." What I would like to know is how someone can list both Lonesome Dove (cool) and Forrest Gump (totally uncool) among their favorite movies.

5. Experience Not Logic, by Will Lewis, who describes himself as a law student at University of San Diego School of Law who, "over the past summer in Shanghai, studied Chinese law and worked at a Chinese law firm." The purpose of Will's blog is "to explore the business and legal culture of China."

6. China Esquire, by Thomas Chow, a San Francisco based attorney who "practices in the areas of business transactions, corporate law and general business litigation. Mr. Chow's professional experience includes handling all stages of pre-trial civil litigation in both federal and state courts, as well as mediation, arbitration, and bankruptcy court practice. In addition to business litigation, Mr. Chow has represented clients in matters involving intellectual property, products liability, unfair competition and securities fraud." This blog focuses on "Chinese law, business, and society… and anything else remotely interesting."

7. Boulder2Beijing, written by two American law school graduates (a married couple) who are studying law in China. Often references very interesting scholarly articles on China law.

8. China Environmental Law, written by Charlie McElwee, an environmental and energy lawyer at Squire Sanders & Dempsey's Shanghai office. This blog "(as the name suggests) focuses on China’s laws, regulations, and policies regarding the environment and energy." This blog promises daily updates on China's environmental situation.

Two other blogs also deserve mention. China Case Law blog is written in English by lawyers at AllenJohn, a Chinese law firm based in Shanghai. This blog describes itself as primarily addressing "the practical issues of China business tax, China labor disputes, China intellectual property protection, China JV & WFOE operation, China real estate investment and China product liability through analysis of judicial interpretation of the Supreme Court of People’s Republic of China and provincial high courts, the decisions of local courts, the verdicts of International Arbitration Committee, and relating China government administrative regulations and rules. The other is China Blawg, put out by a number of attorneys at the Lehman, Lee & Xu law firm. I hesitate to consider this site a blog, both because it does not appear to have a working RSS feed and because it does not have its own separate domain.

Did I miss any?

Next week, I will do my quasi-yearly posting on China technology blogs. So if you have any suggestions there, please leave them in the comments, which I will not publish, but will certainly consider.

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Got an email the other day from blogger extraordinaire Dave Porter, saying, "I know you tend not to like big picture stuff about China, but check out the last half of Berkeley economics professor Brad DeLong’s post on "Free Trade Fair Trade" the last half of which says":

Think of it this way: Consider a world that contains one country that is a true superpower. It is preeminent--economically, technologically, politically, culturally, and militarily. But it lies at the east edge of a vast ocean. And across the ocean is another country--a country with more resources in the long-run, a country that looks likely to in the end supplant the current superpower. What should the superpower's long-run national security strategy be?

I think the answer is clear: if possible, the current superpower should embrace its possible successor. It should bind it as closely as possible with ties of blood, commerce, and culture--so that should the emerging superpower come to its full strength, it will to as great an extent possible share the world view of and regard itself as part of the same civilization as its predecessor: Romans to their Greeks.

In 1877, the rising superpower to the west across the ocean was the United States. The preeminent superpower was Britain. Today the preeminent superpower is the United States. The rising superpower to the west across the ocean is China. that was the rising superpower across the ocean to the west of the world's industrial and military leader. Today it is China.

Throughout the twentieth century it has been greatly to Britain's economic benefit that America has regarded it as a trading partner--a source of opportunities--rather than a politico-military-industrial competitor to be isolated and squashed. And in 1917 and again in 1941 it was to Britain's immeasurable benefit--its veruy soul was on the line--that America regarded it as a friend and an ally rather than as a competitor and an enemy. A world run by those whom de Gaulle called les Anglo-Saxons is a much more comfortable world for Britain than the other possibility--the world in which Europe were run by Adolf Hitler's Saxon-Saxons.

There is a good chance that China is now on the same path to world preeminence that America walked 130 years ago. Come 2047 and again in 2071 and in the years after 2075, America is going to need China. There is nothing more dangerous for America's future national security, nothing more destructive to America's future prosperity, than for Chinese schoolchildren to be taught in 2047 and 2071 and in the years after 2075 that America tried to keep the Chinese as poor as possible for as long as possible.

I generally agree, but does this analysis call for trade with every nation, no matter how rogue? Where is the line?

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The Absurdity, Allegory and China blog has a nice post up on the Olympics, entitled, "The Deck." Nothing terribly new here, but this is a very well put together post asserting that "International Olympic Committee (IOC) president Jacques Rogge is maintaining a "‘deck chairs on the Titanic" charade.

It makes for a good read.

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Jeremiah Jenne, of Granite Studio fame, has a great post up on the China Beat blog, dealing with why the Chinese tend to be so sensitive to foreign criticism of China. In the post, entitled, "Prejudice Made Plausible? Foreign criticism and Chinese sensitivity," Jeremiah, who is getting dangerously close to a Ph.D in Chinese History, does as good a job explaining Chinese sensitivity as I have seen. Makes for a very worthwhile read, particularly as the Olympics draw near.

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Anyone who has been doing business in China for a long time has heard/seen this story a million times. But that is why it is so important. Check out this post, entitled, "The China Price: Fishing for Fast Change."

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Chinese Law Prof Blog has a post, entitled, "Bibliography of Western-language works on Chinese law." It links over to some really good China law bibliographies compiled by Knut Benjamin Pissler of the Max Planck Institute for Foreign Private Law and Private International Law in Hamburg. The bibliographies, dating from 2002, list Western-language works on Chinese law, with a German slant. Mr. Pissler is working on the 2007 edition, which Chinese Law Prof promises to post on when done. Click here for the 2006 bibliography, which, I cannot resist noting, includes Das neue GmbH-Recht der Volksrepublik China, written by co-blogger Steve Dickinson and Harris & Moure German/Spanish/US lawyer, Nadja Vietz, on China's company law.

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When I was a young associate at a Chicago mega firm, I worked on a huge breach of contract case involving two massive utilities. As part of that case, I had to drive down to Southern Ilinois to tour a coal mine. I cannot even remember why it was necessary for me to do this, but I do remember my supervising attorney telling me it would take five hours and that I absolutely had to get there on time to avoid drawing the ire of a very punctual client.

So I left my apartment at 4:00 am and started driving. At maybe 6:00 a.m. (after having exceeded the speed limit by at least ten miles per hour so far) I saw a mileage sign indicating that if I were to go anything even near the speed limit the rest of the way, I would be seriously late. So I got my car up to triple digits where it stayed the rest of the way as I fretted about being late or getting detected by radar. I was not caught (those who have been to rural Ilinois can understand this) but I arrived about five minutes late to a client who very coldly noted this fact in front of a decent sized gathering.

We then went into the coal mine, which meant going down an open air elevator into total darkness; the only light coming from the flashlight on our helmets. The mine height was about five and a half feet (1.68 meters), which meant I had to walk hunched over. We were down there for about an hour and ready to come up when we were alerted that the elevator was not working. We all sat down and waited. Maybe an hour or two later, the elevator was fixed. I drove home, we ended up winning more than $300 million in the case, but I still have an aversion to coal.

Despite that aversion, the importance of the issue requires me to point out an excellent post at Managing the Dragon, entitled, "Price of Coal Triples: Spikes 34 percent in Wake of Weather Disaster in China." This post nicely details how China's increased demand for coal is impacting world coal prices and it explains why coal prices are rising and why even those of us who want nothing to do with coal should care about this.

I recommend it.

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Very helpful/relevant post on China Vortex, entitled, "Business and Social Context Isn’t Important; It’s Everything," on foreign companies' management mistakes in China. Biggest mistake: not recognizing the need for local help. Money quote, with which I completely agree: "Now more companies are going into the Chinese tier 2 and 3 cities and they are realizing that Beijing and Shanghai have more in common with New York, London or Tokyo than with other Chinese cities."

Very thoughtful piece, but wrong to think Chinese companies are not making the same mistakes as they go international. Post talks about how Chinese companies in Africa are not dictating terms "from Beijing," yet my experience with Chinese companies in the United States is that all instructions come from China.

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Jean-Pierre Lehmann, a Professor of International Political Economy at International Institute for Management Development (IMD), has written a very interesting six part series on China from the inside, beginning in the 1950s and running right up to the present and beyond (h/t to China Economics Blog). The series is entitled, China in my life and it consists of the following:

The 1950s
The 1960s
The 1970s
The 1980s
The 21st Century
Exploring China's Future

Fascinating reading.

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I was going to do a post surveying the blogosphere on Steven Spielberg's decision to pull out of the Olympics. My post was going to highlight Mutant Palm'sand Silicon Hutong's posts because I know the writers behind those two blogs really understand China and because I found their posts extremely interesting and thoughtful.

But ImageThief has completely beaten me to it in his post, "Steven Spielberg pulls out of the Olympics - Updated." And since he has done a better job than I would have done, I am just going to say that if you are interested in seeing different perspectives on Spielberg's Darfur decision, you have to go here.

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Interesting online poll just starting up over at The Globalist (look right).

Asks "what is the most daunting challenge facing China today?" and gives the following four choices:

A still-sizable poor population that has been left behind

The adverse environmental effects of its rapid industrialization

Overwhelming pressure to create enough jobs to reduce unemployment

A yearning for democracy that cannot be suppressed

I picked the adverse environmental effects of its rapid industrialization but thought about picking the jobs one.

How about you? Why?

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Very interesting article, entitled, "China returns to communist-style controls to cool inflation in market economy," in the International Herald Tribune on the efforts Beijing is making to try to cool China's inflation.

Will it work?

I wish it would, but I don't think it will.

Ariana Eunjung Cha at the Washington Post has an interesting article, entitled, "Rising Costs in China Seep Into U.S. Market: Importers Pay More or Cancel Orders," on how manufactured goods prices in China just keep rising and on how some are opting out for other countries like Cambodia.

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Excellent post up on Sam Flemming's China IWOM Blog, entitled, "Dell finds closure to Processor Gate and 'Dell Hell' in China." It is on how Dell uses its China internet presence deftly to speak to the Chinese consumer in its own voice. This is a must read article for any business looking for assistance on how to convey their company voice online in China

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Just came across a very interesting and informative article in the China Business Review (a really good publication put out by the US-China Business Council) that nicely sets out China's environmental laws, China's increasing enforcement of those laws, and, most importantly, what foreign companies in China should be doing to stay on the right side of those laws. The article is by Charles R. McElwee II (I always thought seconds were juniors, but what do I know?), an attorney with Squire Sanders, and it is entitled "Who's Cleaning Up This Mess?"

It is well worth a read.

UPDATE: Just received a very nice email from Mr. McElwee, with the following explanation of his name: "As I understand it (and Lord knows I've never looked it up- where would you look it up?) "II" indicates that you are named after your grandfather rather than your father. Having said that I am not not named after my grandfather, but my father. My parents were concerned that if I was designated as "Jr." people would call me "Junior" (a distinct possibility in West Virginia where I grew up) so they designated me the "II." So there you have it."

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Very worthwhile post up on the Experience Not Logic blog, entitled, "Energy: Learning From the Mistakes of Others," nicely laying out how in formulating its energy policies, China should be mindful of and ready to learn from the Enron debacle in the United States.

Full Disclosure: Like a complete idiot, I bought Enron stock after it had dropped to around $3 a share, figuring it would never really go completely under. Guess that is another lesson that can be learned from Enron.

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This is so far outside my expertise that I cannot say anything beyond that it does look very helpful to those seeking to sell to consumer goods in China. The "it" to which I am referring is a 54 page Ogilvy PowerPoint report on Chinese consumers, emphasizing the consumers outside the first tier cities of Shanghai, Beijing, Chongqing, Tianjin, Changchun, Chengdu, Guangzhou, Hangzhou, Harbin, Jinan, Nanjing, Shenyang, Wuhan, Xi'an, Dalian, Qingdao, Shenzhen, and Xiamen (h/t to China Vortex).

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The Black And White Cat does a phenomenal job dissecting how Xinhua changed a Christian Science Monitor article to suit China's own purposes. The post is entitled, "Lost in translation: a one-edged double-edged sword," and it makes for fascinating reading. (h/t to Peking Duck, who hat tips Danwei).

Gosh, who would have thunk it?

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Just came across for the first time, a most interesting China blog. It is called Absurdity, Allegory, and China, and it is hard to describe. I know, however, that I like it and that it is quite literary. It also clicks through to some great photographs.

Near as I can tell, it is written by an English teacher (though I might be wrong about that) out of Tianjin (though I could also be wrong about that) named Jim Gourley (I am pretty sure I am right about that), who also goes by "Rudenoon."

Anyway, this guy has serious insight and his blog is well worth a read. I urge you to read it all, but if you are going to be selective, I particularly liked the following posts:

1. "Here Come The Rats" -- History lives on in the present and that is why though the West sees this as the Chinese century, the Chinese themselves are less certain. A truly brilliant piece.

2. "Confucius Redux?" -- Best blog post yet on China's ant farm scandal. “China is a civilization pretending to be a state. Official corruption and its very selective prosecution underscores this point as well as exposing the Deadwood nature of the place."

3. "Thank You." -- Posts like this should be the best counter to people like nanheyangrouchuan, who sometimes seem so caught up in their own propaganda as to be blind to the fact that among China's 1.3 billion plus people exist real human beings.

Two suggestions though. One, move from Blogspot. Two, allow comments and trackbacks.

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In its post, "Hu Jintao Needs to 'Get Retarded'" the always original Mutant Palm Blog convincingly argues how China's plan to use its cultural industries to advance China's soft power worldwide is doomed to failure.

The post pulls the following quote from Hu Jintao's call for developing China's cultural industry:

“[we must] create more excellent, popular works that reflect the people’s principal position in the country and their real life... vigorously develop the cultural industry, launch major projects to lead the industry as a whole, speed up development of cultural industry bases and clusters of cultural industries with regional features, nurture key enterprises and strategic investors, create a thriving cultural market and enhance the industry’s international competitiveness.”

It then notes how this cultural propagation must be done under "correct guidance" and how "suppression, macro-meddling, nationalism and cultural snobbery" are a poor "recipe for a cultural renaissance." The post uses the Black Eyed Peas and the popularity of their song, "Let's Get Retarded," as proof. Pop is what sells:

Pop music and movies are where it's at (and comic books, but they totally botched the 5155 Project, which just proves how doomed these campaigns are). And globally, nothing sells like booty shaking and giant robots. But all that is going to be too low brow for the Chinese state-dominated media. China's not going to have much cultural soft power until the State Council loosens up. Which ought to be some time around, oh, never.

Mutant Palm is absolutely right. Governments can get away with telling their own people what to do. Governments can even rarely get away with telling their own people what to like. But no government has influence enough to dictate the music, movies, TV, plays, or art to which those outside its borders will listen or watch. Government edict cannot lead to a flowering of Chinese culture worldwide, but government restrictions can certainly stifle it.

China's artistic culture is going to spread and it is going to influence. But those portions of it that spread and influence are not likely to be those mandated or manipulated, or even encouraged, by the state.

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One of my favorite blogs, Jottings From the Granite Studio, has a superb post up on Zhou Enlai, entitled, "This date in history: The Death of Zhou Enlai. Peking Duck rightly describes this post as "blogging at its very best" and additional kudos to the always formidable Danwei for spotting it first and for pulling out the following, which I too see as the key to the post:

Is our lasting image of Zhou Enlai to be the smooth, urbane diplomat showing up for talks in Geneva in a tailored-suit, silk tie, and fedora? Or will it be the Zhou Enlai standing on top of Tiananmen with a red armband and a little red book, screeching in a high-pitched hysterical frenzy, "Long Live Chairman Mao!" as hordes of fanatical teenagers chant in the square and the Chairman looks on in approval?

I am unable to provide a reasonably intelligent answer to that question and I am not even sure if it is because of my own shortcomings on Chinese history or if it is because it is still too soon to be able to jduge dispassionately.

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Since I had promised myself I would never devote a post to Beijing's pollution, please consider this to be on government manipulation of statistics and the perpetual need to examine Chinese government reporting. The International Herald Tribune just did an article, entitled, "Air Quality Improvements in Beijing Challenged," on a study claiming the sole basis for Beijing's claimed air pollution improvements rest on its no longer "including readings from two stations in polluted areas and [its now] ... using readings in three other stations in less polluted locales (h/t to China Challenges)

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Fascinating NY Times article on China's "class of '77," entitled, "1977 Exam Opened Escape Route Into China’s Elite." Article is on the huge successes of those who passed China's first nationwide university entrance exam since 1965 (h/t to my friend Chris Carr, over at the CalPolyMBA Blog). Check it out.

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Came upon an excellent article in Prospect Magazine, thanks to the China Bystander's post entitled, "Getting Off The Bottom Rung In India And China." China Bystander had this to say on the article, itself entitled, "The Silicon Valley of China":

Here is one of those snapshot statistics that throws into sharp relief an entire economy, or two in this case. It comes via journalist Rob Gifford, writing about Hefei in Prospect magazine.

The is one crucial difference between China and India, and a perfect example of it is coated in black tarmac and runs east and west through Hefei. China is a brutal place to live if you are on the bottom rung, but there is an exit. And, just as important, there is a real possibility of a job at the other end. India’s 1.1bn population is rapidly catching up with China’s 1.3bn. But India has only about 10m manufacturing jobs, compared with about 150m in China. So there are simply more opportunities in China to improve your life

The Prospect article is itself fascinating for its portrayal of Hefei's (misguided?) aspirations to become China's Silicon Valley. If I had to name the ten places in China likeliest to become China's Silicon Valley or even something close to Silicon Valley, Hefei would not be on that list.

Are there more opportunities to improve your life in China than in India? What about five years ago and what about five years from now? And does anyone have any experience with Hefei as an up and coming IT center?

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Very good, very interesting, article in today's Washington Post by Ariana Eunjung Cha, entitled, "Tech Boom Sweeps China, But Some Sense a Bubble." General thesis is that there are plenty of good places in China for venture capital (VC) funds to put their money, but valuations are sky high right now:

Some fund managers are wary of what lies ahead in the short term, however, and worry that China is creating a tech bubble similar to the one that burst in the United States at the start of the decade. But venture capitalists, entrepreneurs and competitors point out that Silicon Valley remains a prominent tech center, despite the bust. They say the tech sector in China, which has an estimated 162 million Internet users, will be a force to be reckoned with.

I think all of this is true.

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Just read a post on the Asia Business Intelligence Blog, entitled, "Recommended Blog: China's Scientific and Academic Integrity Watch." The post is on the Scientific & Academic Integrity Watch, which is a blog laser focused on plagiarism in China's scientific and academic community. The blog has taken on the crusade against plagiarism in China, made famous on the net by Fang Zhouzi.

Asia Business Intelligence is right to describe this blog as "of very great interest to the general reader on China" as it really deals with the state of morality in today's China. I urge you to check it out.

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"China Being Poisoned by Its Food Industry, Says Author".

Read it.

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Eyes East has up a most impressive post, entitled, "Citizen journalism for an unharmonious world." The post is on the role citizen journalists and bloggers play in getting out the news in and from countries with a less than rigorous/vigorous media. It is an excellent post and it concludes with what I see as its "money quote:"

I shouldn’t even have to say this at the end of 2007, but seriously, where else am I getting what Global Voices is producing? Or Danwei? Or ESWN?

Yes.

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Regular readers of this blog know the Danone-Wahaha battle to be one of our favorite topics, mostly because of the myriad lessons it teaches. I wrote an op-ed for the Wall Street Journal on it and Steve Dickinson was quoted on it in the New York Times and the International Herald Tribune, and then gave a speech on it for JP Morgan and wrote on it for the China Economic Review . We have also been known to write a post or two on it, including the following:

A lawyer I know referred to it as "China writ large" and though I do not know exactly what that means, it sounds so good I have to agree. I am guessing the good folks over at the Boulder2Beijing blog would agree also as they have written a fourteen page law journal article on what can be learned about Chinese law from the dispute. Having already graduated from law school, I have a fairly strong aversion to reading law journal articles outside of work, but I did skim this one [you will need to download it in pdf format] and it looks quite interesting and quite thoughtful. It is entitled "Wahaha as Pedagogy" and it is written by Micah Schwalb. I was particularly impressed by its diversity and depth of source material. For those with an in-depth law journal level interest in the Danone Wahaha dispute, particularly as it relates to Chinese company law, I strongly urge you to check out Mr. Schwalb's article.

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A beautiful (yes, that's the right word) post on Wangjianshuo's blog (h/t to Think China), entitled, "Not Be Afraid Of Grace And Beauty," lamenting how China's rapid economic rising so often substitutes for and takes precedence over beauty.

John F. Kennedy comes in by way of a quote from him on the South Wall of the J.F.Kennedy Center for Performing Art, but I am pulling the same line from a 1963 speech Kennedy gave at Amherst College:

I look forward to a great future for America, a future in which our country will match its military strength with our moral restraint, its wealth with our wisdom, its power with our purpose. I look forward to an America which will not be afraid of grace and beauty, which will protect the beauty of our natural environment, which will preserve the great old American houses and squares and parks of our national past, and which will build handsome and balanced cities for our future.

I admit to being a sucker for anything JFK, but can anyone even conceivably imagine any of the candidates running for President now, or any President since JFK, saying anything even close to that? And who is saying this for China?

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No legitimate historian doubts massive and horrible slaughters went on in Nanjing (f/k/a Nanking). And every person of conscience knows Japan has not done enough to fess up to it. Incidents like that can never be forgotten, nor should they be. In that light, I have gathered together the following collection of well written and hard hitting posts and articles that can help us come closer to grasper the enormity of the Rape of Nanking and its continuing implications.

Lost Laowai -- "Nanjing -- Listen up and put it to bed"

Der Speigel -- "China's Trauma: Seventy Years After the Rape of Nanking"

CSmonitor -- "In Japan, denial over Nanjing still holds sway after 70 years"

Democratic Central -- "December 13, 1937 -- Rape of Nanking begins" (very good with the historical background)

IntLawGrrls -- "Read On! The Rape of Nanking"

Chinese in Vancouver -- "Film remembers writer who insisted Nanking not be forgotten"

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Paul Kedrosky at the eminently readable Infectious Greed blog did a quick post, appropriately entitled, "Understanding China," linking over to the Journal of Indexes. The Journal of Indexes, in turn, has a whole slew of articles explaining China's economy and stock market. Plenty of good reading there.

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Leave it to ImageThief to do a great job distilling what has been transpiring on the blogosphere regarding a recent LA Times story on CCTV anchorman Edwin Maher and leave to ImageThief to imbue his post with brutal honesty. If you want to read an excellent analysis of the moral issues faced by those involved with China's media and by ALL of us who do business with China, check out "What to make of Edwin Maher?" Be sure to follow all of the links (in particular those to Black and White Cat and Zhongnanhai) and read all of the comments.

It all makes for a most impressive discussion by people very knowledgeable about media.

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Very interesting column in the International Herald Tribune by Jerome A. Cohen, widely considered a leading figure in Chinese law. The article is entitled "A just legal system" and Cohen's thesis is that though "China now has hundreds of thousands of able and increasingly well-trained legal specialists eager to build a credible legal system - one that can meet the demands of a more sophisticated economy and society," China still has a long way to go in legal reform.

It is Well worth the read.

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We have added China Success Stories to our blogroll. Now usually when I add a site to the roll, I drone on somewhat endlessly on how much I like it and on how it is a great source for such and such. I am not going to do that here as my feelings about the site are mixed.

The site describes itself as follows:

China Success Stories is a Dutch company, founded by four China-enthusiasts, out of sheer interest in the Chinese market, and the way it is currently developing itself. Studying the Chinese ‘miracle’ however, we discovered that information on the internet today is shattered, cluttered and even worse, we found a lot of opportunistic stories. In order to unravel the true Chinese story we set foot to simplify doing business with China for everyone. As a first step to fulfilling that mission we will centralize relevant data on this web site. And we created a weekly free newsletter, packed with useful insights, powerful tips and unique first hand experiences of people just like you: enjoying Chinese Success Stories!

Because the site is a collection of posts from various authors its quality is inherently variable. Of course, the quality of posts varies on every site, but more so on sites with unlimited outside authors. So though China Success puts up posts from highly knowledgeable China people like Shaun Rein, Sam Flemming and Jack Perkowski, that should not be missed, it also puts up many posts that should be.

Overall though it definitely does far more good than harm so onto the blogroll it goes and I do urge you to check it out.

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Okay, so that's a bit of an exaggeration. Just a bit though.

Must read post over at Cup of Cha regarding how the Chinese people view various Chinese bloggers. Post is entitled "What Chinese People are Saying About our Blogs" and it is based on Josh's (Cup of Cha's) reviews of China internet forums. The results are fascinating.

We (CLB) are described as "Dan's blog" -- which is unfair as at least half of our deeply substantive posts are written by co-blogger Steve Dickinson and Steve also has input into most of my posts as well. The view on us is as follows:

Dan sees China as having the same kinds of problems as other societies. ZXiang argues that Dan understands China better than other foreigners because CLB makes the case that the West needs to give China more time to do things their own way (presumably reform).

I do see much criticism of China as more out of context than anything else; or at least the context by which I view China. My perspective of China is heavily imbued by my having been intensely involved (including living in) with emerging market countries for the last 25 years. My life experiences with Turkey, Korea, Russia tell me China is both unique and not unique (how's that for a lawyer sentence?), with its non-uniqueness carrying the trump. China is not unique in that so much of what it is criticized for is a natural offshoot of its developmental stage and not much different from the way other countries developed. China is uniquely subject to scrutiny though in that its development is happening in the internet age, at what seems to be an an accelerated pace, and in such a large and important country.

Cup of Cha concludes his post by urging people vote for us in the pending ABA Journal best blog competition. Now if I could just capture 1% of that 1.3 billion....

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I have written almost nothing on Yahoo's China issues because for me to add any real insight I would need to read reams and reams of stories on it and I am not prepared to do so. But, when someone as knowledgeable on China's media/internet as Will Moss writes on the Yahoo issue, I feel I should at least pass it on.

Here's Will's post on Yahoo from his blog ImageThief. The post comes from Will's column in the China Economic Review, here.

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I take no position one way or the other on any Chinese stock market crash, but I am certainly impressed by the analysis in this Asia Times article written by Martin Hutchinson of the Prudent Bear (h/t to the China Economics Blog). The article is entitled, "The Coming China Crash" and it claims a crash is "imminent" due in large measure to China's "lack of a rational system of capital allocation."

China Matters also has a very thoughtful gloom and doom post entitled, "We Interrupt This Blog To Announce the End of the World." The post is based on this Roubini post asserting that China is not decoupled from the US economy.

Of course, not everyone agrees.

I was one class short of an economics major, which means I studied just enough to know that economist's predictions are correct about half the time.

On a somewhat less gloomy note:

An economist, a physicist and a chemist are stranded on an island with one unopened can of food. The physicist suggests they roll the can down a hill where it will strike a rock which will pierce the can and release the food. The chemist suggests they cool the can in the ocean then heat it in the sun so as to cause the can to burst. The economist suggests they assume they have a can opener.

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David Dayton over at the Silk Road Blog has for quite some time been churning out really good posts focused on China sourcing. The only reason I have not put this blog on our blogroll is because it is so difficult to navigate, due in large part (I suspect) to it being part of the company website. A few weeks ago, I told David (with whom my firm has worked on a number of projects) that if he would just make his site easier to navigate I would put it on our blogroll. He assured me he eventually would.

Then I blinked.

I went to the Silk Road Blog today and realized there is simply too much good stuff there to put form over substance, so on it goes.

I just love his post, "Random thoughts from 5 non-stop days in 7 factories in three provinces in China." The post is nine thoughts, with the following three being my favorites:

1. "Factory owner and millionaire, 35 years old, tells me that the road out in front of his factory he built with his own hands when he was in high-school. The local govt required all households to provide unpaid labor for specific lengths of the new road. His father was a teacher and away at school and his mother was over 40 and the only one home. So he had to miss much of one year of high school to fill the State-mandated labor quota. These are the type of people that you’re dealing with in China—you need to know that they can wait you out. They are not intimidated by your pressure. They know they can dump your product in the local markets if you back out. You need to understand that you’re probably not nearly as important to these many factories as you think you are." I have had clients think their Chinese supplier will never let them go and then have to pay a very steep price to learn otherwise.

2. "Except for Beijing, all airports built in China in the last 15 years are exactly the same. Some just have more gates than others. One large room divided by check-in and security counters, (cold) metal and glass, blue, silver/grey and white are the only acceptable colors, rounded-girders or stretched “mountain-tops” roof design. The same crappy shops with over-priced luggage and the choice of Haggendas, noodles, Dove chocolate, Pepsi, local dried fruits/meats and knock-off electronics. 90% of the travelers are Chinese men in dark suits, 8 % are foreign men in jeans and polo shirts, the other 2% are young women, almost no kids. All airport customer service employees are women, departures on the top floor, arrivals on the bottom." Never noticed this, but I am certain more than 2% are young women (even assuming a bias).

3. "Unless specifically contracted otherwise “good enough” is the going rate for production standards in China. Doesn’t matter what you're making. If good enough isn’t, you’d better make sure you spec out exactly what is acceptable." This is absolutely true.

Another excellent post, entitled, "Things That Make China Prices Rise," details a conversation Dayton had with a client unpleasantly surprised by China's pricing:

Just a few days ago I had a client ask me about some (factory direct) prices, saying: “I thought China was supposed to be a great deal?!” Well sure, it can be. But not everything every time is going to be blow-your-socks-off cheap and fast. It often depends on a number of different factors, some you can and some you cannot control.

For example if you’ve got small quantities and lots of SKU’s, as does this client, there really isn’t going to be a great bargain anywhere. One of the keys to “China pricing” is millions of the same widgets, not hundreds of different widgets.

Another key is having a real reason to be here—are you here just because everyone else is? Can you do smaller runs just as cheaply at home without the hassle of overseas production? Unless there is clear bottom line (or other) reasons to be here, you don't have to be here.

A third key is to do your research UP FRONT. Don't make the transition to China and then see if it is cost effective to have done so. Finding and qualifying the best supplier possible will save you TONS of money, problems and headaches later.

David Dayton really knows his stuff and for interesting and highly informative posts on China sourcing, I urge you to check out the Silk Road Blog.

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Rebecca McKinnon, who knows and understands China's internet better than just about any other Westerner, is out with a pretty comprehensive post on how Web 2.0 has not delivered the speech goods many predicted for it. Have to be intentionally vague here (you will know why when you get to her blog), but I can assure you that Rebecca's post is well worth the read and I urge you to check it out.

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China Matters is out with a long post on the Kitty Hawk affair, entitled "Beating a Hawk in the Water." Thesis of the post is that China's Thanksgiving snub of the Kitty Hawk was no misunderstanding, but rather, a strong message. I have not kept up enough with the incident to agree or disagree with this post, but I do know it engages in very credible analysis and it is certainly well worth a read.

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About a month ago, I did a post on The China Game blog and the China Vortex blog, calling them "promising." They have both passed this blog's three month in existence rule for making our blogroll and their promise has been fulfilled.

In my initial post on these two blogs, I said the following:

Two good new China blogs out there by two already pretty well known China hands.

Paul Midler (who I believe coined the phrase China fade, referring to the diminishing quality of China products) has started a blog called The China Game. Paul has been involved with China manufacturing for more than 15 years and many of his posts focus on China manufacturing. Paul has an MBA from Wharton Business School and he speaks Mandarin. More importantly, his B.A. comes from my alma mater, Grinnell College. He currently heads up China