Entries Tagged as 'Thailand'

The more things change…

…the more they stay the same.

Shocker: Official and unofficial numbers for China 2012 economy are not the same!!!  And, hold your breath…..the official numbers not only aren’t accurate they’ve erred on the side of making last year’s downturn less dramatic and the upturn more impressive.  Amazing how it always seems to happen that way for the govt. fighting for social stability.

All irony aside, the numbers show that growth, while slightly better is not at the 7.5-8% levels that just 5 years ago Beijing was claiming MUST be maintained at all costs to keep employment where is needed to be (one of the arguments for not floating the currency).  Growth at 5.5% this next year without significant reforms for the 400 million still not urbanized and poor job prospects for the recent college grads will mean continuing frustrations for the CCP (especially as housing prices start to tick back up again).

New Business Insight: Don’t transfer Western business practices to China directly without some cultural/market specific adaptations.  Do MBA’s learn anything other than numbers in grad school?  Surely they have to take a couple of OB or corporate culture classes, right?  I’m no accountant, I’ll be the first to admit.  But if I needed one, I’d hire one rather than think that I could do it myself.  Why don’t accountants (not picking on accountants specifically, just making a point) hire Chinese consultants before moving to China?

Amazing Thailand: A Buddhist country steeped in centuries of political corruption and a face-conscious culture chooses the middle ground to keep the economy going and wait out the end of the King’s reign.

Red Shirts and Business as Usual

The protests in BKK have put the Thai government and the Thai people in an awkward position.  The protests are no longer about if the government will change.  Rather they are about when will the govt step down, how will it come about, and what will Thailand do afterward.

The reality is that the Red Shirts have won.  Like it or not, they have been in the streets too long and have too many people shutting down too much of the city to be physically moved or cajoled out.  The government has ordered them out, has issued summons for arrest of the leaders and still they fill the streets and shut down multiple shopping malls, hotels and intersections.

The govt looks both weak and indecisive even though they have the law on their side.  They probably have about ½ of the populace on their side and business leaders are putting pressure on them to do something too.  But they have done nothing.

But to be fair, the govt have few if any choices left to them.  They can use force and push out the Red SHirts and then have a full scale riot on their hands—this will garner support from people on the fence and be condemned by all the int’l press and foreign govts.

Or they can negotiate—which just means that the Red Shirts get more and more leverage the longer they can hold out.

The military doesn’t want to step in either.  This is evidenced by the fact that there are NO police or military on the streets at all (police offices near the protests are closed!).  Even though there is a State of Emergency in effect, laws specifically regarding mass assemblies have been breached and there have been more than 40 bomb threats in the last 3 weeks—even injured policemen–there is NO security presence visible at all in the main protest area (Radjaprasong Dist.).

So if the military aren’t going to stop the protests will they force a coup?

They are stuck here too.  If they force a new govt on the people then they’ve simply recreated the same problem they are facing now—a non-elected government that the people do not accept.

This is a crisis of faith in the system, not just a partisan political move at this point.  The Thai people have to choose: if the government is dissolved and a new election occurs, will they accept democracy regardless of whom is elected or will the next government also face mass protests from the opposition?

If it was just the position of the PM in Thailand that was in question this might be just an academic question.  For example, Military kicks out Abhisit and sets up a temporary govt for 2-3 months to set up new elections and then the democratic vote ends the problem.  But it’s much more serious than that.

It is no secret that corruption in Thailand (and China, and Vietnam, etc., etc.) is a historical and cultural problem that affects not just governments but businesses and everyday life of almost everyone living in it’s wake. The Thai courts, the military, the freedom of press, the relationships/influence of business and powerful families are all in question.

So what if the government is replaced but the courts are still controlled by the military?  So what if a new PM is elected democratically if he again has big business ties (as Thaksin did)?  So what if Thailand gets a new government but a large enough percentage of the population decides they’re not going to accept it no matter what (and protest until the choice is, again, force or absolving yet another )?

Regardless of who wins this round Thai’s have some ethical decisions to make about what’s next for the land of smiles.  And these decisions will specifically affect business as well as politics, hopefully for the better.

On a lighter note, the best piece of political commentary I’ve ever heard came from a speech given by a UDD leader yesterday.  In talking about policies that look good on the surface he said (Using the word for transvestite as the personal pronoun) “It may look pretty, but until you see which bathroom it walks into you don’t really know what it is.”

And I bought a great shirt t00.  It says: “Have you gagged-down-like-a-dog enough yet?”  Very vulgar Thai verb for eat that you don’t use for people.

Also, the Red Shirts were the most polite group of protesters I’ve ever seen.  They offered me food, drinks and a place to sit and listen (relative close to the stage).  I must have had polite conversations with 10-15 different people attending the rallies last night–all from BKK (as opposed to the afternoon folk which are mostly bussed in from the provinces and paid around 65B/day)–to a person they were interested in what I understood and hoped that I would support their cause.  But they weren’t pushy about it.

Finally, just by chance I ran into a buddy from grad school who was also watching the protests.  What are the odds?!  Two Americans, that speak Thai, who went to school together, in the midst of a crowed of more than 10,000 people, at night, run into each other!

Books to read if you’re coming to China

I apologize for not posting for a while.  I was completing a year-long goal of losing 50lbs and running a triathlon, the Laguna Phuket Triathlon, this last week.  I have never been so proud of 618th place in my life!

I’ve also been incredible busy–I’m writing this from Vietnam. 5 countries in the last week and the contrast in national “personalities” is just striking–I’m literally overlooking a huge street party in HCM city right now.  Vietnam just won the Asian Games football gold.  Thailand was a vacation (whether we wanted it or not) and China is 24/7 business–we were gone for only a week and came back to a new building that had previously just been cement, with a totally new glass face.  Taiwan seems more and more depressing each time I go and Hong Kong is still amazing.   And as we’re heading back to the US for Christmas (country #6 in 10 days), this will be the last post of the year too–other than the annual year-end review of the most popular posts.

Thanks for reading and commenting.  Merry Christmas and Happy New Year.

At the last Global Sources show in Hong Kong I was asked after my presentation: “So is there anything else that you think we (people new to business in China) should know?”  I answered, “Yea, tons!  Do you have a year?”

my bookself Here’s the longer answer to that question.  These are my suggestions based on the books that I’ve read over the last few years.  These are all books that I liked and found to be of value, or at least to be of interest.  I tried to focus the list and limit the qtty to what I expected is a manageable amount of reading for someone who is busy moving to another country.

Of course, this list is in no way exhaustive.  Feel free to add to it.

I’ve divided the suggestions into different categories based loosely on the situation of the coming reader.  The first link is to SRI’s book review (if I wrote one), and the second is to Amazon–you’re welcome.  My favorites are numbered (1-10).

First, Business Professionals—meaning people that are going to be working in China in a more or less completely Chinese environment full time.

(4) Inside Chinese Business, by Ming-Jer Chen

(3) Chinese Business Etiquette, by Scott D. Seligman

(7) The China Price, by Alexandra Harney

The Chinese, by Jasper Becker

Managing the Dragon, by Jack Perkowski and (8) Mr. China, by Tim Clissold

Business Leadership in China, by Frank T. Gallo

(5) The Coming Collapse of China, by Gordon G. Chang

(Yes, there are a ton of other books that could go here–feel free to add to the list below–but these are the ones that I thought were the best.)

Sub category: Importers—people trying to build their own brands and markets within China.

All of the Business books above, plus:

Luxury China, by Michel Chevalier and Pierre Xiao Lu

(6) Elite China, by Pierre Xiao Lu

Where East Eats West, by Sam Goodman

Sub category: Buyers—these are people that are here irregularly, but still have significant in-China experience.

All of the Business books above, plus:

Poorly Made in China, by Paul Midler

Factory Girls, by Leslie T. Chang

All the Tea in China, by Jeremy Haft

One Billion Customers, by James McGregor

Second, non-business types. Maybe spouses of professionals and/or English teachers or students (non-business focus).

(9) River Town, by Peter Hessler

Oracle Bones, by Peter Hessler

The Rape of Nanking, by Iris Chang

Will the Boat Sink the Water, by Chen Guidi and Wu Chuntao

Wild Swans, Jung Chang

Life and Death in Shanghai, by Nien Cheng

Soul Mountain, by Gao Xingjian

Chinese Lessons, by John Pomfret

China Hands, by James R. Lilley and Jeffery Lilley

Lonely Planet China, here’s the web site too.

Sub category: Politics and/or higher education

(10) China: Fragile Superpower, by Susan L. Shirk

The Tiananmen Papers, by Liang Zhang, Andrew J. Nathan, Perry Link, and Orville Schell

(1)Gifts Favors and Banquets (anthropology), by Mayfair Mei-Hui Yang

(2) Capitalism with Chinese Characteristics, by Yasheng Huang

The Great Wall, China Against the World, by Julia Lovell

What does China Think?, by Mark Leonard

The Search for Modern China (history), by Jonathan D. Spence

Chinese Religiosities (anthropology), by Mayfair Mei-Hui Yang

Thailand—to visit or not to visit?

Update 13th May: Thailand tourist numbers 1/2 of last year’s numbers.

—————————–

If you only read/watch the news on the major sites then you’d probably concede that tourists in Thailand are in a world of danger because of the ongoing political protests there.  But talking with people on the ground, I find that quite the opposite is true.  I have one friend on holiday there now.  No problems.  Ditto multiple friends that live and work right in downtown BKK.  This article would agree with their experiences.

Certainly the long term consequences of the color coded temper tantrums will be significant.  Even disastrous.  But fears of physical harm to tourists are overplayed by the media looking for a story and subsequent over-reacting governments issuing travel warnings based on “news” reports.  (By the way, is there anything more overvalued by it’s own people and less valued by the rest of the world nowadays than the MSM?)  You should be much more worried about being poisoned by a mistress/hooker or beat up by a bootlegger than being caught up in political violence.  Even the Thai’s with color-coded blinders realized how stupid it was to shut the airport down, so that’s not much of a fear anymore.  The point is, you’re in about as much danger as you put your self in.

Further to the point that the media has to make up work for it’s employees, when I was a student in Israel in ’94 my parents were freaking out watching the news each day just sure that I was going to get blown up while shopping.  Other than a few limes thrown at us and a few rocks thrown at our buss, nothing happened for an entire semester.  Indeed, the “news” stories that my parents were seeing I’d not even heard about!  And I was living there!

One more example and then I’ll let the poor horse die.  I was in Chongqing in ’95 when China was shooting missiles into the Taiwan Strait.  Once again, we got a number of phone calls and letters (no email at that our “Communications University” yet, but they’d all read books about it!) full of concern that we were either being bombed or going to be thrown in the gulag and never allowed to leave.  If we hadn’t had the riveting and insightful CCTV and the People’s Daily we wouldn’t have even have known it was happening.

Now is a great time to go to Thailand; it hasn’t started raining yet and you’ll have the place all to yourself!  And if there are any more political problems this year, Christmas in Thailand is going to be a fantastic time to take long walks on totally empty beaches too!  Foreigners can buy homes/apartments there too and, like most places, it’s a buyers market right now. (No, I don’t get paid if you go there.)

Just remember to get an on-the-ground perspective before you cancel your factory visit or your beach vacation to Thailand.

Bits and Pieces From This Week in China

1. Factories out the Wazoo!

I’ve been in 7 different factories in the last 10 days.  Factories making everything from furniture to molded metal office suppliers, from clothing to candle holders, and from offset printing to silk screening.  Despite their different industries/products they all had a few things in common.

One, they all had over 100 and under 300 employees—about ½ of what they all claim to have had this time last year.  Two, they were all working at way under capacity—two of them doing nothing but our orders this week.  Three, they all had some version of the same story: western client XYZ didn’t pay/canceled order/can’t take delivery—do we want to buy their product?

I was really amazed that there really wasn’t more anger.  They were all very matter of fact about it, though many were hurting.  I suspect that more than one of them will not be in business this time next year.  They were all still fishing for export orders and didn’t plan on looking for more domestic clients.  I asked if the domestic orders had increase at all and to a man they all said they had gone down as well.  They didn’t see the local market being able to step in and offer any significant replacement orders.  Just read this on CLB about Chinese stereotyping too.

By far the weirdest comment I heard last week was from one manager who claims that the US will soon start a war with China so that it doesn’t have to pay back any of the debt that China has purchased over the last two decades.  He told me wars were generally good for the economy and a war with China would be doubly good (for the US) since the US could stimulate the economy and write of billions of dollars in debt at the same time.  He was serious about it too.

I responded as politely as possible and shared a couple of jokes to try to lighten him up a bit—I told him that (thanks to the Vizzini the Sicilian) Americans know to “never get involved in a land war in Asia” and that two countries with McDonald’s had never fought a war.  More seriously, I tried to explain that our economies are too interdependent and that the physical, human and economic costs of these two huge economies going to war was a far greater loss than not paying back the whatever hundreds of billions in treasury debt that the US owes China.  He responded by saying that of course I would that, I’m doing business here.  But then left me with the oft-heard chilling factoid “China would win because we have more people and we don’t care about going back for the dead bodies” I was left with little room to respond.

2. Reading about China

While I travel back and forth from factories I have a lot of time to read.  I finished a couple of books about managing organizations/people in China this month and have a few thoughts that I think are important apart from the forthcoming reviews of the books themselves.

First, “entrepreneurial” and “innovative” are not the same thing.  I agree with Jack Perkowski that “the Chinese are among the most entrepreneurial people in the world,” but I add that they have not yet shown the same successes in innovation.  Can they?  Yes, certainly.  Will they?  I don’t know, but I surely wouldn’t bet against them.  The larger point really is that in many books (especially by Chinese themselves) the two concepts are used as synonyms.  Which they are not.  If they were, I wouldn’t have a job and Chinese brand names and/or new products would be seen much more in world markets.  Indeed, at least 50% of my time in China is spent putting out fires and solving problems (another 40% is spent setting and enforcing standards).  Creative and effective solutions to problems are by far the most valuable and rare commodity to me in China today.

One of the reasons, and the second important idea here, is that there isn’t a single locally-educated manager (MBA) with more than 15 years of experience in China today.  The first MBA program was only just started in 1991.  Think about what that means for any company in China—either your management team are all under 40, or they are foreigners or they were western educated, or they simply don’t have the education that most international business expect.  (I do not mean that without an MBA there are no great managers in China over or under 40.)  How many millions (?) of Chinese companies are just doing things “their own way,” or “like they’ve always been done,” or by will of the owner’s personality?!  This is a big part of the reason why it’s so hard to get international standard product on a regular basis from domestic level factories.  Perkowski says that “China has a shortage of more than seventy-five thousand “globally competent” managers.” And “the need for local managers is only going to increase.”

Great take on the current Chinese comments on world economics on Jack Perkowski’s blog today too.

And a couple of good articles on Taiwan and the continuation of corruption in China.

3. Chinese traffic and Hospitals, part 3,476.

I have a friend (overseas Chinese) who, over the weekend, fell while getting off the bus.  (It’s tough for most people, especially ladies in skirts and high heels, to get off a lurching vehicle that’s supposed to be stopped.)  She fell and was hurt pretty badly and had to be taken to a local hospital.  The bus company admitted responsibility.

She had some people help her check in and see an MD at the nearest hospital.  First MD says that she has a broken pelvis and a broken femur and will have to stay in the hospital in intensive care for at least a week (with expensive meds) and then have bed rest with hospital care and physical therapy for another 3-4 weeks.  She decides that although she is in pain she wants a second opinion.  The bus company wants her to get a second opinion too, they don’t want to pay for all the time in the hospital.  By the way, any guesses what the bus company’s compensation for a hospital stay is?  50RMB a day.  Since my friend was a “housewife” that is her official economic value–$7.32 per day.

So she goes to a second hospital and gets a second opinion, this time with x-rays.  Final prognoses?  Bruises.  She’s sore, at home and walking now.  No broken bones, nothing but standard pain meds.  No physical therapy necessary.  Just sit on a pillow and move slowly for a few weeks.

Like you’re doing with your factories here— bring your own translators and double check everything.

Car Crash

Next (believe it or not), I saw another dead body on the way to a factory in Panyu.  The accident was on the Guang-Shen Expressway at the Chang An off-ramp about 8AM Saturday.  There were not yet any police or emergency vehicles on the scene yet.  The bus I was on drove by just minutes after it happened, before traffic was even backed up much.  Don’t know exactly how it happened, but the car had been smashed by a bus.  It looked like the driver’s side had been hit by the front right corner of the bus.  Which probably means the lady driving the car didn’t check her blind spot (what blind spot?!) when changing lanes.  As we drove past we could see her neck at a bad angle, no airbag and lots of blood on her face.  Really sad.

So, like last time, just be careful.  That’s the point here.  (If you comment on this part of the post, your comments will not be posted—so there!  ttthhhbbbbtt)

F4

And so we don’t end this section on a bad note, here is a much nicer bit about cars and faces.  Ferrari F4 for sale here at a show in Coco Park.  Asking price?  About $500,000 USD.  Not sure where you could safely drive an F4 here.  It seems to me that owning one in China would be like being the Far Side deer with the bad birthmark.  (“Bummer of a birthmark, Hal.)  But I’d much rather have these faces stuck in my head than the other one!!

4. Thailand–bad and getting worse.

Not only is it bad in Thailand but it was twice as bad in February ‘09 as it was in November ‘08.  Ouch!  At least the government is taking measures that will help both now (investment monies) and later (re-education/training), unlike the US which is spending money that won’t help now or later!  And an interesting look at how factory closings are affecting individuals.  And another bit on increasingly bad bank loans this year too.

I guess it’s time for me to suck it up and go to Phuket and see what I can personally do to help stimulate the local economy.  Anyone else up for sacrificing a weekend in the name of global altruism?  I really think that it’s the least we can do.