“It appears that in many areas, China is no longer opening up, but selectively closing up,” the EU Chamber of Commerce wrote in its European Business in China – Position Paper 2017/2018, released on September 19.
For years, foreign businesspeople have complained about China’s protectionism, and urged the government to move toward reciprocity and transparency in regulation across industries. The complaints have dialed up in volume in 2017 since President Xi’s speech at Davos in January that cast himself — and China — as the world’s new leader of globalization in the Trump era. So far, Foreigner Inc. is not impressed:
- CNBC notes that “about 54 percent of European firms say they perceive they’re treated less favorably than domestic companies,” according to the EU Chamber of Commerce report.
- American companies are even more negative: Earlier this year, the American Chamber of Commerce in China said that 81 percent of surveyed American businesses in China saw decreasing, not increasing, openness in the Chinese market in 2017.
- The New York Times again reported (paywall) on Facebook’s efforts — so far almost entirely in vain — to get its foot in the door in China. Kai-Fu Lee of Sinovation Ventures said, “There’s an interest on both sides of the dance, so some kind of product can be introduced…but what Facebook wants [in China] is impossible, and what they can have may not be very meaningful.” In other words, China only ever allows foreign business to operate in China on its own terms, and establishing a business built on the free flow of information is impossible in the country.
European businesses are “suffering from accumulated ‘promise fatigue,’” the EU Chamber of Commerce report continued. Will the latest promise, a “package of reforms which would give foreign investors greater access to the nation’s financial services industry,” as reported by Bloomberg, become just another unfulfilled dream? Nisha Gopalan, writing (paywall) in Bloomberg Businessweek, believes so — China is already the world’s fourth-most-restricted country for foreign direct investment, so anything less than a complete overhaul of what foreign money is allowed to do in the Middle Kingdom might be too late.
Sina investor seeks changes in rare activism at a Chinese firm / Bloomberg
An after-hours company visit spurs espionage charges / WSJ (paywall)
Airbus looks to China for A380 jumbo amid sluggish global sales / Reuters
Rolls Royce chairman predicts: Chinese-made jet engines coming soon / CNBC
Food and beverage
Baijiu sales recover as China’s political winds shift / FT (paywall)
The world’s best caviar doesn’t come from Russia anymore / Bloomberg
Chinese couple jailed and fined US$8.8 million for selling smuggled beef / SCMP
Real Madrid adds lustre to China’s wannabe ‘Orlando’ tourist hub / Reuters
Ctrip sets up first offshore shop in Scotland / Caixin
Macro trends and trade
Yuan strength softens Chinese demand for foreign currency / Caixin
China’s slumping cement output is a better guide to real economy / Bloomberg
More money, less output? China unveils strong credit numbers after soft growth data / SCMP