Elizabeth Economy just did a Washington Post article on how and why China is blaming foreign companies for China’s own pollution problems. Entitled, A Blame Game China Needs to Stop, it discusses how China is seeking to diffuse international criticism of its environmental record by “launching a political campaign that lays much of the blame for the country’s mounting environmental problems squarely on the shoulders of foreigners.”
We told you so.
Ten months ago, in a post, entitled, Is China Going Green? — Part VII — Doesn’t Matter Because You Should No Matter What, we wrote how “people often get very emotional about the environment and I can see Chinese citizens getting very angry at a foreign company whose units in China are less environmentally sound than their units in the United States or elsewhere.”
That day is now.
The Washington Post article notes “growing international and popular discontent over the country’s environmental crisis,” has led China’s leaders to tap “into anti-foreign and nationalist sentiments to deflect attention from their own failures”:
In late October a top environmental official, Pan Yue, accused the developed countries of “environmental colonialism”: of transferring resource-intensive, polluting industries to China and bearing as little environmental responsibility as possible. At the same time, a leading member of China’s National People’s Congress claimed that foreign companies were not only exporting their waste but also underpaying Chinese workers. When a Chinese nongovernmental organization released a list of 2,700 companies cited for violations of China’s water regulations in late October, the ensuing media frenzy focused exclusively on the 33 multinationals, including 3M, Panasonic, PepsiCo and DuPont, and ignored the more than 2,600 Chinese companies similarly cited. Not surprisingly, Chinese bloggers have taken up the call, discussing the “eco-colonialist” policies of multinationals and calling for “eco-compensation.” Even environmental activists who have worked closely with multinationals have accused these corporations of not practicing what they preach.
As the article notes, “scapegoating foreigners can be an attractive policy option.”
It most certainly is.
As we have written previously, and as those doing business in China well know, forcing foreign businesses to abide by Chinese laws that either do not apply to domestic companies, or which domestic companies ignore, is going on across the board. Foreign companies are to unionize, while domestic companies are not generally required to do so. Foreign companies are to pay their taxes, while domestic companies often do not. Foreign companies must operate fully legally, while domestic companies typically need not.
When Westerners proclaim (as they fairly often do) to our China lawyers that China’s laws are essentially the same for foreign companies doing business in China and Chinese companies doing business in China, we typically respond with something like, “and that means what in real life?”
So what’s a foreign company doing business in China to do? You can get Beijing to change its policies and become even-handed — just kidding.
Or, you can come clean by following all rules. Register your company in China; the crackdown on this is already in full force. Pay your taxes in China. Do not pay bribes. Ever. Follow international environmental standards. In other words, forget about the so-called “Chinese way,” as that never really applied to you anyway, and it certainly does not apply to you now. Complain all you like, but the wise thing to do is to heed the advice of our own Steve Dickinson, and start recognizing there is a “new paradigm” in town and you as a foreign business must abide by it.
For more on the Chinese government’s distinguishing between foreign and domestic businesses, check out, China Policy — Let Mikey (Foreigners) Do It and China’s Corporate Tax System to Become Unified — Someday.