‘Today, it seems to be China’s turn’

China is endlessly fascinated by the West’s economic success. It accounts for the deference one receives as a Western foreigner and the herds of Chinese students studying finance both in China and abroad.

It does not seem to matter that most Westerners in China are as knowledgeable about finance as they are the intricacies of particle physics, or the fact that most Chinese finance majors are working as bank tellers.

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It is both our curse and blessing that, as humans, we are able to rationalize irrational beliefs and actions. Sisyphus was condemned to push a stone up a hill only to have it roll back and crush him; many of us, individually and collectively, seem to do this as a sport.

What has this to do with anything?

I recently ran into a European who, on their first visit to China, was about to sign a joint venture deal. They had miraculously run into a wonderful Chinese partner whose goal seemed to be to share their good fortune with them. The joint venture was to act as a broker on behalf of hundreds of Chinese businesses who were intent on selling/buying businesses abroad. They made a point of announcing their good fortune to an assembled multitude of people. You could palpably feel the shrugs and quizzical gazes of those within ear shot. The individual in question might have been surprised that no one asked them any follow-up questions, or seemed to be at all interested in newly announced Klondike, but it did not seem to dampen their enthusiasm.

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These, as they say, are the “days of our lives.” In the past, I might have said something about making sure they had a good translator and did their due diligence, but those days have gone by. Far too often, the reaction has been either indifference or a long rationalization on how they see this “great opportunity.”

After an 11-year adventure in China, the only certain thing seems to be that wisdom is more often gained from experience than tutoring. But, despite this, every two weeks this column is put out on the hope that it will be of some use to someone as they explore their economic interests abroad. The irony does not escape me, but I am sure Sisyphus enjoys the company.

As this column goes forward, it is hoped that you, as readers, will provide some questions or suggested topics. The pace at which China is changing, the chasm between the rhetoric and the reality, makes it difficult to pick topics.

For example: when I first came to China, it produced less than a third of what we produced. In 2008, when this column was started, China produced 60 percent of what we did. Today, China has replaced us as the world’s leading manufacturer.

It took us 170 years and two wars, after our revolution, to supplant our European competitors. China has overtaken us in 60 years. In 2000 and 2007, the focus was on “Free Trade,” WTO, Open Markets and China as a supplier to the world.

Today, the trend is moving towards protectionism, while conversely China is viewed increasingly in terms of its domestic markets. In the United States, the changes have been just as dramatic, from prosperity and bull markets to real estate bubbles and financial chicanery.

The changing economic fortunes of the world’s two preeminent powers are having broader geopolitical implications that go far beyond the China of 2000 and 2007. Today, the face of China is in Africa, Australia and the United States. In the past, we were the economic aggressors. Today, it seems to be China’s turn.

Today, we are a nation divided in search of answers to problems often of our own making. How will China affect us? Will China learn from our mistakes or repeat them? Perhaps we should ask our friend Sisyphus, or perhaps you have some wisdom you wish to share. If you do, please contact me at: einartangen@yahoo.com.

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