I am often sent books on China by people who want me to review them and I always take the book (there is such a thing as a free lunch?), but explain that I am already a couple of books behind. What I really have always meant by that was that I read the book, China Shakes The World, by James Kynge around 8-10 months ago and before I can review any other book on this blog, I must first review that one. But I just could not do it.
My problem was that all I could ever think to say about the book was that “you must read it, it’s great.” Because it is.
The book is not difficult and it is not complex, but it is dense in the sense that it is packed with so much insight and value. I started out putting post-its on the pages I thought I would want to refer to later, but I had to stop when it became clear I was post-itting (if that is not a word, it certainly should be) just about every other page.
I just could not write the review.
But now, I no longer feel the need to do my own review of the book because Richard, over at the always formidable Peking Duck, has written the review I have been meaning to write. So instead of my needing to write my own, I will, to use legal terminology, fully incorporate his review as though written herein.
In addition to my full incorporation, I note the following highlights from Richard’s review and ask everyone to pretend I wrote them instead of Richard (that’s not a copyright violation, is it?).
Here goes with the quotes straight from the Peking Duck’s brilliant post:
This book is unsurpassed in terms of exploring and analyzing just how enormous an effect China is having on the entire world. And anyone who doesn’t acknowledge that China is shaking the world is either in a state of willful denial or is living in a cave.
What makes this book special is its approach to the subject, focusing on the effect of China’s rise on other countries and other peoples. It’s not just another roundup of stories about the “China miracle” and how much Western CEOs are loving doing business in China.
Looking over the book now, I see that I’ve dog-eared just about every page and written notes in many of the margins. There’s so much, it’s hard to condense it into a single blog post. So allow me simply to give some impressions of various points Kynge makes, in no particular order.
What Kynge manages to do better than any author I’ve read to date is to capture in words just how strange a trading partner China is, and how it resembles no other great power. Examples are plentiful – companies that make semiconductors and tomato catsup; companies that thrive on the theft of intellectual property; companies that produce an insane over-supply of products; companies that operate on an entirely different moral and cultural plane from their global counterparts. Kynge’s vivid anecdotes paint a picture of a country that in many ways is downright freakish and unbelievably unfair and corrupt. A country that is just so different.
And yet…. Kynge is always clear-headed and balanced to a fault. After enumerating the many bizarreries that make China seem so peculiar, he offers some important balance.
You come away from this book enraged at China and in awe of China, hating it and admiring it. Perhaps the most hackneyed phrase about China is that it’s a “land of contradictions,” but such phrases only become hackneyed because they contain a strong element of truth. Kynge brings us all the contradictions and spins them into a narrative that kept me turning from page to page throughout my flight to Munich [okay, so I read most of it on a flight to Seoul]. One story about a girl whose life is for all intents and purposes stolen from her by a corrupt official who stole her identity so his daughter could get into a good university will bring tears to your eyes. And stories of the sheer guile of Chinese workers , like those who dismantled the Dortmund steel mill, will make you smile.
And his description of just how inequitable the competition from China can be will leave you hopelessly frustrated:
The Chinese fixed the value of their currency against the US dollar, keeping it undervalued so as to give their exports greater competitiveness. They provided little or no welfare for their workers, so their costs were artificially low. There were no independent unions in China, so the safety standards…in Chinese factories would have been illegal in America. The state banking system provided cheap credit to state companies that could default without consequence. The central government gave generous value added tax rebates to exporters that were not available to US retailers. Restrictions on emissions were lax, so companies had to pay relatively little to keep the environment clean. Chinese companies routinely stole foreign intellectual property, but it was difficult to prosecute them because the courts were either corrupt or under government control. Finally, the state kept the price of various inputs, such as electricity and water, artificially low, thereby subsidizing industry.
But for all of China’s ruthlessness and seemingly unstoppable growth, crushing anything that gets in its path, Kynge leaves us more with a sense of doubt than of fear (though there’s plenty of fear, too). Doubt, because China’s problems (and here comes another hackneyed cliché) are so immense, so overwhelming that its ascension to the status of a global superpower still remains in question. And if it does join the superpower club, surely it will be the strangest member. There has never been a superpower quite like it.
In terms of balance, perspective and brilliant analysis of what China is today and where it is going tomorrow, this is the best book you can buy.
Yes, yes, yes.
The only thing I add to Richard’s post is that if you think this book is too “big-think” to be relevant to your own business with China or if you think this book has nothing to teach you about doing business with China, you are dead wrong. This book provides the best macroeconomic analysis of China I have yet seen and, by doing so, it provides invaluable knowledge on how to adjust/position your business to compete in China.
Oh yeah, and one more thing: It is a great book and you must read it.