The China Venture
The China Venture The China Venture
List of Figures FIGURE 2-1: DEVELOPMENT OF FOREIGN DIRECT INVESTMENTS (IN BILLION USD) COMBINED WITH KEY EVENTS IN CHINA, 1976 - 2000...................................6 FIGURE 2-2: STRUCTURE OF CHINA'S FINANCIAL SECTOR............................................. 24 FIGURE 2-3: STRUCTURE OF CHINA'S BANKING SECTOR................................................. 25 FIGURE 3-1: ORGANISATION OF THE GOVERNMENT OF THE PEOPLE 'S REPUBLIC OF CHINA........................................................................................................... 63 FIGURE 3-2: MAP OF CHINA............................................................................................. 65 FIGURE 3-3: PRELIMINARY STRUCTURE OF THE "SINO-SWISS PARTNERSHIP FUND".... 67 FIGURE 3-4: MANAGEMENT CONTROL VS . FINANCIAL EXPOSURE OF VARIOUS INVESTMENT VEHICLES................................................................................ 76 FIGURE 3-5: DEVELOPMENT OF FORMS OF CO-OPERATION IN CHINA............................. 78 FIGURE 3-6: IDEAL PROFILE OF A COMPANY INVESTING IN CHINA................................... 84 FIGURE 3-7: PROFILE OF A TYPICAL SMALL OR MEDIUM ENTERPRISE............................. 88 FIGURE 3-8: PROFILE OF A CHINESE JOINT VENTURE PARTNER.................................... 89 FIGURE 3-9: PROFILE OF FOREIGN BANKS AND GOVERNMENT INSTITUTIONS................ 90 FIGURE 3-10: PROFILE OF BUSINESS PARKS..................................................................... 91 FIGURE 3-11: PROFILE FOR THE OPTIMUM COMBINATION OF AL L POTENTIAL PARTNERS. 92 FIGURE 3-12: PROFILE OF SUZHOU MFN EMBROIDERY CO. LTD.................................... 93 FIGURE 3-13: PROFILE OF SUZHOU NOVE FASHION & CRAFTS CO. LTD......................... 95 FIGURE 3-14: PROFILE OF SWISSTEC................................................................................ 96 FIGURE 3-15: THE WAY TO "GOLDEN TOWN "..................................................................104 FIGURE 3-16: DETERMINANTS FOR THE CHOICE OF THE MARKET ENTRY STRATEGY......109 FIGURE 3-17: INTERNAL DETERMINANTS .........................................................................110 FIGURE 3-18: THE CHOICE OF MARKET ENTRY STRATEGY.............................................112 FIGURE 3-19: THREE LEVELS OF CULTURE......................................................................126 viii
List of Tables TABLE 2-1: THE AREAS OF THE FOUR SPECIALISED BANKS............................................ 26 TABLE 2-2: DIFFERENCES IN BANKING SERVICES .......................................................... 29 TABLE 3-1: SWOT ANALYSIS FOR SPSC IN RESPECT TO MARKET ENTRY IN ASIA...... 58 TABLE 3-2: INCENTIVES FOR FOREIGN INVESTORS........................................................ 68 TABLE 3-3: OVERVIEW OF INVESTMENT VEHICLES IN CHINA......................................... 77 TABLE 3-4: STRATEGIC QUESTIONS FOR SME'S PLANNING TO INVEST IN CHINA......... 79 TABLE 3-5: RISK ANALYSIS OF INVESTMENTS IN CHINA................................................. 80 TABLE 3-6: KEY SUCCESS FACTORS C ONCERNING PRODUCTS AND MARKETS............. 81 TABLE 3-7: SUCCESS FACTORS CONCERNING CHINESE PARTNERS.............................. 82 TABLE 3-8: KEY SUCCESS FACTORS CONCERNING COMPANY STRUCTURE AND ADMINISTRATION .......................................................................................... 83 TABLE 3-9: QUALIFICATION PROFILE OF MANAGERS WORKING IN CHINA....................102 TABLE 3-10: MEMBERS OF THE SWISSTEC ORGANISATION ...........................................105 TABLE 3-11: EXTERNAL DETERMINANTS........................................................................110 TABLE 3-12: TECHNOLOGY DETERMINANTS ..................................................................111 TABLE 3-13: RELATIONS BETWEEN A SME AND ITS BARGAINING PARTNERS...............117 TABLE 3-14: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES AND CHINESE AUTHORITIES......................................................................118 TABLE 3-15: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES AND CHINESE JV P ARTNERS.....................................................................120 TABLE 3-16: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES AND DISTRIBUTORS....................................................................................122 TABLE 3-17: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES AND CHINESE TECHNOLOGY RECIPIENT...................................................123 TABLE 3-18: COMPARISON OF VALUES AND BEHAVIOUR..............................................129 TABLE 3-19: PRESENTATION OF THE OWN PERSON.......................................................130 TABLE 3-20: COMMUNICATION BEHAVIO UR AT THE FIRST MEETING..............................131 TABLE 3-21: MANAGER-THINKING: COMPARISON OF GERMANY/ SWITZERLAND AND CHINA.........................................................................................................134 ix
- Page 1 and 2: The China Venture: Business Environ
- Page 3 and 4: Table of Contents List of Figures .
- Page 5 and 6: 3.2.3.2 Special Funds for Setting U
- Page 7: 3.4.1.1 National Culture ..........
- Page 11 and 12: GBP Pounds Sterling GDB Guangdong D
- Page 13 and 14: 1. Introduction: The China Venture
- Page 15 and 16: After a short discussion with the p
- Page 17 and 18: co-operate with other firms, especi
- Page 19 and 20: The Chinese operating legal system
- Page 21 and 22: First of all, Britain’s predomina
- Page 23 and 24: democratic centralism, all governme
- Page 25 and 26: The courts are the state organs exe
- Page 27 and 28: more than three hundred intermedia
- Page 29 and 30: 2.2.8 Company Law China’s first n
- Page 31 and 32: Things seem have to become a lot cl
- Page 33 and 34: 2.3.1.1 Financial sector developmen
- Page 35 and 36: securities, trading, initial public
- Page 37 and 38: underdeveloped compared with market
- Page 39 and 40: established in January 1996 by 59 p
- Page 41 and 42: Chinese Banks Foreign Banks Financi
- Page 43 and 44: system formulation has been put on
- Page 45 and 46: The separation of production and co
- Page 47 and 48: swap centres (see also above). From
- Page 49 and 50: investors with little experience an
- Page 51 and 52: them, while a branch with a shortag
- Page 53 and 54: Loans, public offerings of shares,
- Page 55 and 56: is often to acquire foreign capital
- Page 57 and 58: 2.3.3.2 Debt financing As getting t
List of Tables<br />
TABLE 2-1: THE AREAS OF THE FOUR SPECIALISED BANKS............................................ 26<br />
TABLE 2-2: DIFFERENCES IN BANKING SERVICES .......................................................... 29<br />
TABLE 3-1: SWOT ANALYSIS FOR SPSC IN RESPECT TO MARKET ENTRY IN ASIA...... 58<br />
TABLE 3-2: INCENTIVES FOR FOREIGN INVESTORS........................................................ 68<br />
TABLE 3-3: OVERVIEW OF INVESTMENT VEHICLES IN CHINA......................................... 77<br />
TABLE 3-4: STRATEGIC QUESTIONS FOR SME'S PLANNING TO INVEST IN CHINA......... 79<br />
TABLE 3-5: RISK ANALYSIS OF INVESTMENTS IN CHINA................................................. 80<br />
TABLE 3-6: KEY SUCCESS FACTORS C ONCERNING PRODUCTS AND MARKETS............. 81<br />
TABLE 3-7: SUCCESS FACTORS CONCERNING CHINESE PARTNERS.............................. 82<br />
TABLE 3-8: KEY SUCCESS FACTORS CONCERNING COMPANY STRUCTURE AND<br />
ADMINISTRATION .......................................................................................... 83<br />
TABLE 3-9: QUALIFICATION PROFILE OF MANAGERS WORKING IN CHINA....................102<br />
TABLE 3-10: MEMBERS OF THE SWISSTEC ORGANISATION ...........................................105<br />
TABLE 3-11: EXTERNAL DETERMINANTS........................................................................110<br />
TABLE 3-12: TECHNOLOGY DETERMINANTS ..................................................................111<br />
TABLE 3-13: RELATIONS BETWEEN A SME AND ITS BARGAINING PARTNERS...............117<br />
TABLE 3-14: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES<br />
AND CHINESE AUTHORITIES......................................................................118<br />
TABLE 3-15: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES<br />
AND CHINESE JV P ARTNERS.....................................................................120<br />
TABLE 3-16: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES<br />
AND DISTRIBUTORS....................................................................................122<br />
TABLE 3-17: INTERESTS, OBJECTIVES AND EXPECTATIONS BETWEEN HIGH-TECH SMES<br />
AND CHINESE TECHNOLOGY RECIPIENT...................................................123<br />
TABLE 3-18: COMPARISON OF VALUES AND BEHAVIOUR..............................................129<br />
TABLE 3-19: PRESENTATION OF THE OWN PERSON.......................................................130<br />
TABLE 3-20: COMMUNICATION BEHAVIO UR AT THE FIRST MEETING..............................131<br />
TABLE 3-21: MANAGER-THINKING: COMPARISON OF GERMANY/ SWITZERLAND AND<br />
CHINA.........................................................................................................134<br />
ix
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