China’s expansion numbers are ambivalent, but the poor diffusion of its model is unequivocal. By now, breaking records is one of Beijing’s specialties; an impressive sequence of results has undeniably projected it into a leading role in the global theater. In any case, there are signals of slowing growth, like the greatly reduced acquisitions of German Mittelstand businesses, the high quality small-medium enterprises that would be valuable for China’s technological improvement (we wrote about this in last week’s post). Even Chinese investments in the US are languishing, entangled in politics and national security issues, despite ideal economic conditions. Not surprising are the obstacles hindering China’s approach to Japan, the third region—after Europe and North America—where China could find the innovation it needs. The numbers reveal that Chinese capital has been deferred, and negotiations to sign bilateral accords are still in the deep water. On the contrary, investments in countries that produce raw materials continue; they are generally weaker politically and economically underdeveloped. London is one exception, but it involves the real estate market where selling assets to Chinese investors is less challenging.
The recession is palpable in the real economy, more in terms of lost opportunities than what statistics reveal. There’s a mixed attitude of rejection, suspicion, disinterest, and disillusionment toward business partnerships with China. People that work between Europe and China have an undeniable perception of this. Business, law offices, and communication firms are closing their China desks. Setting up business meetings required more time and effort, as if you were forcing the involved parties into an undesired interaction. Even curiosity concerning the Middle Kingdom is waning, as if economic transactions had exhausted other spheres of knowledge. Sociologists teach us that expatriated Chinese communities don’t integrate, and that students studying in the best universities don’t bring the cross-cultural knowledge expect by such high-level programs. Ironically, in a globalized world, China continues to assert its differences. But, this inspires continually less sympathy. The economy is running the risk of souring relationships, but in turn it’s risking losing sight of its objectives, which are profit opportunities. Essentially, China is missing two central aspects needed to affirm itself in the business world: an endearing soft power, and a network of services to accompany its economic might. It’s not enough to have production capacity or reserves to spend. It is necessary to confirm the trust of your partners, maintain business etiquette, and instill hope rather than fear. The great Chinese culture should be a springboard for the future, not a mantra for justifying any kind of behavior. Furthermore, a framework of services would support the economy: legal offices that recognize international laws, respected consulting agencies, business ethics that marry power relationships, and assuming international responsibilities that go beyond the country’s interests. All of this is still insufficient, and in any case, not in line with China’s dimensions and the expectations that its success generated. There are no ideological foreclosures toward China because its entrance into the globalized world is beyond refuted. China should not dissipate the respect that in acquired though hard work, perseverance, and dedication. The last two generations in China experience hardship, the challenges of reconstruction, and the deprivations of underdevelopment. The results achieved have attracted huge and deserved admiration. Instead, attitudes prevail today that are frequently contrary to modesty and frugality. The road to complete redemption is still long, and those that have the country’s reigns in their hands know that international collaboration is indispensable and that it needs to be cultivated with humility and dedication, not only with the adoration of power, even if they tend in China’s favor now.