Letters From Shanghai (And Guangzhou)

October 25, 2009 § 1 Comment

The Canton Trade Fair. Picture by tarotastic

Shanghai is an amazingly prosperous city. Possibly the most prosperous city in Asia I’ve seen so far in my short but sweet travel experiences. Aston Martin car showrooms, beautiful French-decor houses, middle-and-upper class Shanghaians decked out in their nines on a Friday night along the streets of  Xintiandi. Regal Chinese restaurants that take up four storeys worth of dining space within a large complex, and always filled up with cigarette-smoking businessmen and women seeking to impress their clients.

Yet by no means should Shanghai be an end-all impression of what China truly is. Here are my thoughts:

1. Cosmopolitan Shanghai has its Warhol-ian side

On my first day here in Shanghai, I quickly grew tired of the countless number of polish-perfect shopping malls, and cool people. The second day, however, I got to see another side of Shanghai. While material prosperity may have driven and fueled the Shanghai Machine, its artistic and cultural heartbeat is well and alive. Its history of European concessions after the Opium war is preserved in what is known to the guide books as “The French Concession”. These French-built colonial buildings are well preserved in the southern parts of Yan’an Road, along with a beautifully large garden styled in reference to Versailes Palace’s own. Not too far away, along the old warrens and shikumen (stone-door houses), old shantys have been transformed into Shanghai’s own alternative lifestyle cum arts district. Don’t get the wrong idea, it ain’t hippies and starving artists here. They’re shrewd young Chinese who have a flair for pop art and pop eateries, with entire lanes styled to make you feel you’re not in Shanghai, but along the cobbled streets of an European town. Each with its own distinctive style and goods, no two shops are exactly the same.

2. Shanghai’s Infrastructure Is A Reflection Of The Government’s Willingness To Spend

From Maglev trains to world class tennis facilities, and even the 2008 Beijing Olympics that left many speechless, it does seem like boomtime for the Chinese Government. Having more than a trillion in federal reserve notes, Hu Jintao’s government is willing to do all it takes to show that China (or at least Shanghai) has truly arrived. This is all positive, after all, living standards of all Chinese have risen dramatically.

3. Social Glue Is A Requirement For Doing Business With  Chinese Nationals

Everyone wants to do business in China, yet its such a complicated matter. Take the well known “guanxi” for example. Guanxi both facilitates and frustrates. Guanxi is social glue. Skip paying fines or get better tickets on a train if you’ve got a relative working from the inside. When you’re doing business with mainland Chinese, don’t be surprised if he brings others into the fray. He’ll probably involve his uncle, brother, and distant 5th cousin along as well.

4. Social Attitudes Lag Behind Modern Infrastructure

With Shanghai’s incessant pace to modernize, not everything or everyone catches up. Money can buy you all the steel, tar, microchips you need, but it can’t buy your people new attitudes and cultures in an instant. For all its modern exterior’s worth, the mainland Chinese are in need of social modernization as well. This shouldn’t be surprising for any rapidly developed city: Its people act and think in ways that seem to echo developing world attitudes. Singapore was like that too, not too long ago. Examples: Beautiful Chinese ladies decked out in the best dresses spitting on the streets, lack of a sense of service by staff at shops and restaurants. Oh, you’ll be surprised if you see any queues here too. Its mostly mobs.

I overheard this conversation between two old Chinese friends, one mainland Chinese, the other Singaporean:

A (Singaporean) : Shanghai is  modernizing at an amazing pace isn’t it?

B (Mainland Chinese): Yes it is. Our cities will probably rival the most modern US and European cities in 10 years time. Can’t say the same about people’s attitudes though.

A: Another ten years you think?

B: Probably thirty years.

China the dominant superpower in 2040. Looking at how the world’s developing right now, its probably an inevitability.

5. In Shanghai, Money  Speaks Volumes

Cash is king here in Shanghai. Money buys social status, along with its material rewards. The widely accepted idea is that if you’ve got no money, your words ain’t worth any weight. When your words don’t mean a thing, the world looks down on you.

If people truly relied on purely the material for self-worth, it is probably a reflection of emptiness inside and a lack of self-confidence. That said, the lonely individual who wishes to live a fulfilling life, fighting against being a cog in the machinery is not unique to Shanghai.

With all the Ecstasy of Yuan, I do believe that many entrepreneurs in China look beyond money as motivation. I would like to think that many also see entrepreneurship as a creative outlet, a force for cultural and social change. As Josh Kaufman mentioned, there are two ways to see business: Simply a path to riches, or a path to making change in people’s lives.

6. Social Media in China Is Present, Just Different

Access to the internet is reasonably convenient in Shanghai and Guangzhou. Or ridiculously inaccessible. It depends how you look at it. If you’ve always been on Facebook, Twitter, blogger, wordpress, and the likes of Web 2.0 as we know it, internet in China is going to feel pre-1998 for you. What I’m really driving at is that social media as the western world (and Singapore) knows it, is nonexistent in China. Thats because we’re not looking at social media through Chinese lenses. Xiaonei, RenRen, TaoTao, represent for the biggest “facebooks” and “twitters” in China. The western world, thinking that it was ahead in social media, has realized that Chinese social networks are blooming wildly. Internet usage in China isn’t just boundaried, individual use is carefully monitored as well. It shouldn’t be a surprise that the Great Firewall of China has to employ a really large number of “internet police” to achieve this.

Hu Jintao’s government mitigation strategy towards western social media’s dangers is to completely shut it out from within its borders, until it finds a better way to deal with it.

7. The Challenges Of Doing Business In China (or with Chinese people in general)

Being Chinese myself, I didn’t really understand this, but my short but sweet experience in China has left me feeling that trade is often carried out with a certain level of mistrust and overcaution when dealing with us Chinese, and amongst Chinese. At the Guangzhou trade fair, it is sometimes all smiles between the exhibitor and buyer, sometimes its the good ol’ fashioned, you vs. me, I win/you lose. I ask for name cards, singnalling intent in doing business in the near future, and sometimes I get rejected, the seller citing no-responses even after distributing hundreds of costly-to-print namecards.  My dad has had 20 years of experience doing business with China, and that seems  the case for him: that the process of building trust in China is a long and drawn out experience. As Tim Ferriss mentioned recently, western ideas of business ethics is rare in China. The prevalent thinking is “能骗就骗” (neng pian jiou pian) i.e. “If one can deceive, then by all means do so!” It explains the lack of respect for intellectual property, rampant “piracy” in China, or the rest of Asia.

8. The Challenge For Businesses In The Freeconomy

The “piracy” problem is actually a doubled edged sword. This novel challenge that China and Asia brings to the world: Apart from declaring war on the pirates, how will we adapt to an audience who can easily get hold of your intellectual property for free, or almost free? How will our businesses survive?

If Philippe Starck comes up with a revolutionary new design for a kitchen blender, China can make an exact clone of the product days after the original piece is released to the market. Thats the reality of “Made-In-China”, and the reality of China as the World’s Factory.

We live in exciting times.

***Here’s a comparison with what I’ve learnt from Vietnam***

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