News from China

I went to the 6th annual LSE SU China Development forum yesterday – this is my third visit to the forum with my son Oliver – who is fascinated by all things Chinese. What stood out this time ?

Liberalisation and opening up ? 

last year there was much excited anticipation about the upcoming third plenum when new premier Xi would lay out his reform agenda. These may be ambitious but do not appear to include a freer media:-

-250,000 journalists have to sit an exam in “Marxism news value”is they are to get accreditation- in other words they will find it difficult to work without having studied the 700 page manual that goes with the course.

-New deans of the top journalism schools are mainly party officials

-Those investigative journalists-who expose malpractice, corruption and incompetence-have to be very brave souls and face harassment or worse :which necessarily reduces the numbers who will do this kind of work.

Certainly there has been a technological revolution with mass penetration of internet access and use of blogs and microblogs. But these are still monitored closely. It is an ambiguous world in which truth tellers have to intuit how close they can sale to the wind and read the shifting sands of official sanction.

Chinese Soft Power- perceptions of China abroad

Sir Christopher Hum, former ambassador to PRC, gave his scorecard on how China was doing on soft power.

He noted that much soft power in China is government sponsored – which may not be a recipe for success.

Good things he noted were

-Chinese art market – booming exciting and creative and thoroughly free of the state

-Confucian institutes to promote language and culture – they do just that and are not used as mouthpieces of government

-Chinese diplomats have got much better at dealing with the media

Not so good

-Chinese films- after a flurry of excitement over a decade ago with the likes of Crouching Tiger Hidden Dragon  Chinese film has stalled because the good recent films by the likes of Jia Jhang-ke ( see The World which is very good in a bleak way and Platform) tend to present a “realistic” view of Chinese society and so incur official displeasure. A recent Chinese film festival in london exited very little interests as it did not showcase this more challenging work.

-Official media abroad :CCTV and Xinhua have expanded their operations but are too “stiff” and to self evidently government mouthpieces to win big audiences. They need more independence and better journalism – take a leaf out of Al-Jezeera’s book

-Leadership’s new big idea- The China Dream is big in China but has little traction abroad. China politically abroad reflects two ideas of “guided capitalism” and “a one party state”. This has not exported well. The American Dream of a land of freedom and opportunity is still much more appealing to populations around the world ( if not their politicians).

-Foriegn relations and domestic security: China’s approach in its own back yard and regionally excites apprehension and anxiety.

Treatment of Tibet, Falun Gong and Liu Xiaobo reflect the insecurities of a security driven state.

This of course is partly real – China is still encircled by alliances made by USA with Japan and Taiwan after WW2. Just because you are paranoid it does not mean that people are not out to get you. The USA is widely thought to have planted malware in Chinese computer systems to be activated in the event of conflict.

– Chinese (and Japanese leaders) have failed to move on from the “mutual hatred” – the phrase was used by a former US diplomat- created by WW2 atrocities. Chinese  leaders are all to ready to use nationalist sentiments as a way of shoring up their position. This looks like weakness not strength and people see it for what it is.

Chinese Business goes abroad in order to come back home stronger

M&A is booming- up from $1bn in transactions a decade ago to $50bn last year- 10 years ago it was all about securing energy and now it is across the board-consumer, industrial etc

One of the big motivations for Chinese companies is not so much to penetrate foreign markets as to buy the expertise and brand reputations too help them gain an edge in the (potentially huge) home market- they “go out in order to come back”

Good examples are Geely buying Volvo , Lenovo buying IBM’s PC and now Motorola’s mobile division (from Google) and Bright Food’s purchase of Weetabix. Example financial services M&A to follow as Chinese banks follow Chinese business investment around the world.

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