Please activate JavaScript!
Please install Adobe Flash Player, click here for download


24 D+C  e-Paper  December 2015 Doris Fischer holds a chair in China Business and Economics at the University of Würzburg. [email protected] Huawai stand at trade fair in Sao Paulo. China’s central government wants to avoid environ- mental scandals that might damage the country’s image. But to enforce laws in such a huge country, it depends on regional authorities. The central govern- ment has more leverage with large companies than with the multitude of small companies, which is quite hard to control. What is the goal of China’s foreign-trade policy? Until the end of the 20th century, the idea was basi- cally to attract foreign investors. But that did not mean that Chinese companies were encouraged to invest abroad. When China joined the World Trade Organization (WTO) in 2001, the foreign-trade policy changed. China is now pursuing a strategy called “going out” or “going global”. The restrictions on Chi- nese companies investing abroad have been relaxed step by step. For instance, Chinese companies can now buy foreign currencies. The going-global policy is still young however. For a long time, a relevant way for the authorities to promote corporate foreign activities was simply to no longer block such activi- ties. However, conventional instruments to promote foreign activities are increasingly being used, includ- ing support from chambers of commerce or subsi- dised loans from development banks. Government agencies, moreover offer advice, information and loans. All in all, the system is not that different from Germany’s. Does China have anything like Japan’s Ministry of International Trade and Industry, which for decades implemented strategies and coordi- nated businesses in order to make Japanese industries internationally competitive sector by sector? No, China doesn’t have such a focused policy, and it would be difficult to implement given China’s enormous size. But that doesn’t mean that the state doesn’t play a role. It is actually very important. Private-sector companies cannot grow large unless they have a close relationship with local govern- ments, and once they reach a certain size, they also have to deal with the central government. Whether they receive government support is a different story. Although companies like Alibaba, Wanda or Ten- cent are private, they never would have been able to become as large as they are today if they weren’t on good terms with the party and the state. Once a cor- poration starts operating internationally, however, things change once more. Because they no longer get government ­support? No, that is not the point. Beijing is actually quite eager to support companies’ foreign activities. For instance, embassy staff will represent the interests of private-sector companies vis-à-vis government agencies. The regime wants Chinese corporations to succeed abroad, and it is prepared to do its part, regardless of whether the companies are private or state-owned. However, unlike state-owned enter- prises, private companies are liable for their actions. Alibaba went public in New York rather than in China, which the Chinese government would cer- tainly have preferred. The decision-making processes within private companies often have other results than the government would like. What factors drive corporate decisions? Business interests are more important to private companies than state-owned ones. Private compa- nies want to make a profit, expand their activities and sometimes simply safeguard capital abroad. Often they are motivated by the desire to escape state control. Some companies don’t care what Beijing wants, and that attitude doesn’t necessarily reflect how many shares the state has in that company. In the case of big companies, for instance in the oil industry, some managerial positions are staffed with party functionaries, but that doesn’t mean that these companies always do what the central government wants. They are internationally active, need to make profits and are listed on a stock market after all. Moreover, not all party members march in lockstep – and some functionaries are happy to move assets to safe havens abroad. The Chinese are frequently suspected of con- ducting industrial espionage. To what extent does it actually occur? Industrial espionage is a huge problem worldwide, just like cyber-attacks. Of course we shouldn’t assume that China isn’t doing it. But that does not mean that everything is controlled by the central government. It is very hard to assess whether China is really conducting industrial espionage on a much larger scale than the USA, for example. photoshot/picture-alliance