Archives: foreign company

As I mentioned previously, I expect to be writing a number of posts arising from issues that were discussed at the recent Doing Business in China seminar I co-moderated last week.  At lunch, one of the attendees told me that they had been told by a higher up at a big U.S. retailer that they would not be going into China because they did not trust the government not to shut them down.

I pooh-poohed that, saying that the more likely reason was because this retailer knew that it would have no particular advantage in China and that it would be better off expanding elsewhere.  I then thought for a moment and added that I was not aware of a single foreign company that had been shut down in China when it was operating legally.  That evening I asked a number of the other speakers whether they were aware of an instance where the Chinese government had shut down a foreign company that had been operating legally in China and they too were not.  The odds of getting shut down in China are minimal if you are operating legally there.

Yes, China is and has been for some time stepping up its shut-downs of companies that are not operating legally there, but I just am not aware of an instance where it has done so to a foreign company that is abiding by its laws.

Are you?

I have never bought into the notion that China’s government seeks an economic slowdown nor do I believe it has sufficient power over the country to orchestrate one even if it tried. I am not even certain a slowdown is right for China or the world at this time.

That is why I like this article, entitled, China economy may accelerate. It says forget about a China slowdown in 2007 and just expect another year of rapid growth. China needs jobs and a booming economy for the 2008 Olympics and that is what it will get.

In other words, if you are a foreign company doing business in China, expect 2007 to be a very good year. China’s growth in 2007 will be 2006, redux. You heard it here second.