The US investigation into JP Morgan Chase having hired the children of well-connected officials in China is one of those events that threatens to up-end a business practice that is long-established and widespread, yet hard to justify when it is placed under a harsh spotlight.
The problem is at least as much for China itself as for the Wall Street banks and financial institutions that have followed the local practice by trying to get themselves some good connections. It speaks to the justified resentment of many Chinese at the way the elite “princeling” class accrues wealth.
As it happens, the investigation has emerged in the same week that Bo Xilai goes on formal trial on charges of bribery, corruption and abuse of power. Mr Bo’s downfall was a catalyst in exposing the extreme internal strains within the Chinese leadership caused by such issues. Read more
When Huawei’s new handset manufacturing complex opens in 2016 at Songshan Lake in southern China, it will include a building modelled on Krakow’s Wawel Castle. The former Polish royal residence was preferred over proposals based on other European beauty spots including the palace of Versailles, Granada’s Alhambra and Windermere in the English Lake District. That a fast-growing telecoms group should draw inspiration for the next phase of its assault on the 21st-century global phone market from a 16th-century castle is not as strange as it sounds.
Even by China’s standards, Wuhan Iron & Steel is enormous. As we drive along the four-lane highway beside the 22 square-kilometre site – with its eight blast furnaces, hot and cold rolling mills, port on the Yangtze River and Red Steel City workers’ town where 300,000 people live – the scale of Mao Zedong’s favourite steelworks is staggering.
The western image of Chinese higher education is of relentless self-improvement and of hundreds of thousands of students graduating from universities with degrees in science and engineering. From China’s perspective, it looks a little different.
The slowing of growth and the fact that most new job creation is now taking place in the private sector, rather than in the public sector and state-owned enterprises, has led to a glut of new graduates. The unemployment rate among 21 to 25-years olds is now highest for university graduates.
But some Chinese analysts think it is not simply a demand problem – there is also a supply issue. Victor Yuan, chairman of Horizon Research, a Shanghai-based research group, argues that many universities are offering poor quality vocational education. Read more
Being invited for tea in China sounds like the sort of hospitable gesture that visitors come to expect. For the growing arm of Chinese bloggers – and users of Sina Weibo, China’s equivalent of Twitter – it has a different connotation.
In that context, “he cha” (drink tea), means being asked to come and talk to the state security services about what you have been writing. That doesn’t mean being arrested, or even banned from Weibo permanently, but it is a shot across the bows. Read more
You would think that an American executive who came to China in 2006 and has only made one sale since then might be feeling a little discouraged. But, as I discovered on a visit to the city of Wuhan in Hubei province, Brad Bean is not.
Since Mr Bean is trying to sell luxury yachts to billionaires – 70-to-100-metre vessels that retail for between $50m and $120m each – he thinks he is making good progress. China, after all, is not the obvious place to buy a yacht. Read more
In 2010, seven managers from PSA Peugeot Citroën and five from Chang’an Automobile met in Shenzhen, southern China, to lay the groundwork for a new car factory. Three years later, Capsa, a 50-50 joint venture between the French and Chinese companies, is in the final stages of preparing a 1m square metre plant for the September launch of Chinese-made premium cars under the DS brand. “Because we were beginning from a blank sheet, people wanted to make it as perfect as possible,” says Gilles Boussac, Capsa’s president, between meetings with his team of mostly Chinese managers. “So often in China, if you’re trying to rework or improve something, it takes years to achieve.”
Expect more Chinese heroes. That seems to be the clear message of the tie-up announced on Wednesday between China’s Seven Stars and Pinewood Shepperton Studios. Among other things, it should allow Chinese co-productions wider distribution in the fast-growing Chinese market, provided, my colleague Robert Cookson writes, they have “at least one Chinese actor, some scenes to be filmed in China, and somehow relate to China”. Read more