APB Lecture 4
Asia Pacific Business
Lecture 4
Business in China
Dr. Huaichuan Rui
School of Management
Royal Holloway
University of London
This lecture includes
1.
2.
3.
4.
Introduction
Political and Economic Environment
State Owned Enterprises’ Reform
Changing Policy Toward Foreign Direct
Investment
5. Challenges for Foreign Firms in China
1. Introduction
Profile: People’s Republic of
China
Area: 9.6 million sq km
Population: 1.34 billion (UN, 2009)
Currency: Renminbi Yuan (Rmb)
Major language: Mandarin Chinese
Major religions: Buddhism,
Christianity, Islam, Taoism
Foreign direct investment, inflow
90.03 billion dollars (2009)
GNI per capita: US $2,940 (World
Bank, 2008)
Main exports: Manufactured goods, including textiles, garments, electronics President: Hu, Jintao
Politics: Socialism
Sources: BBC; Google Map
3
Table: China’s GDP growth on an annual basis
(expressed as a percent)
91
92
93
94
95
9.3 14.2 13.5 11.8 10.2
96
9.7
97
8.8
98
7.8
99
7.1
00
7.7
01
02
7
7.3
03
04
8
9.1
05
06
07
08
11
12
E
9.1 10.2 10.7 11.4 9.2 7.5
2. Political and Economic
Environment
Under Maoist China (1949-1976)
1949, 1st Oct in Beijing, the government led by the
Chinese Communist Party (CCP) was established.
Mao Zedong was the CCP Chairman and head of the
State.
Highly centralized bureaucratic system
Nationalized industries vs. state owned enterprises
(SOEs)
SOEs: the government set targets for production, allocated labour, appointed management, arranged
Danwei and Hukou: key systems under Mao’s regime
Danwei were work units of workers
Little opportunities for workers to change jobs
Important control and surveillance functions
Control on people’s freedom of movement
Household registration system (Hukou)
State policy changes since 1976
1976, Deng Xiaoping takes power and initiates far-reaching economic reforms.
1978 at 11th CCP Central Committee criticizes
‘Leftist’ policies
Chinese government restates
Lecture 4
Business in China
Dr. Huaichuan Rui
School of Management
Royal Holloway
University of London
This lecture includes
1.
2.
3.
4.
Introduction
Political and Economic Environment
State Owned Enterprises’ Reform
Changing Policy Toward Foreign Direct
Investment
5. Challenges for Foreign Firms in China
1. Introduction
Profile: People’s Republic of
China
Area: 9.6 million sq km
Population: 1.34 billion (UN, 2009)
Currency: Renminbi Yuan (Rmb)
Major language: Mandarin Chinese
Major religions: Buddhism,
Christianity, Islam, Taoism
Foreign direct investment, inflow
90.03 billion dollars (2009)
GNI per capita: US $2,940 (World
Bank, 2008)
Main exports: Manufactured goods, including textiles, garments, electronics President: Hu, Jintao
Politics: Socialism
Sources: BBC; Google Map
3
Table: China’s GDP growth on an annual basis
(expressed as a percent)
91
92
93
94
95
9.3 14.2 13.5 11.8 10.2
96
9.7
97
8.8
98
7.8
99
7.1
00
7.7
01
02
7
7.3
03
04
8
9.1
05
06
07
08
11
12
E
9.1 10.2 10.7 11.4 9.2 7.5
2. Political and Economic
Environment
Under Maoist China (1949-1976)
1949, 1st Oct in Beijing, the government led by the
Chinese Communist Party (CCP) was established.
Mao Zedong was the CCP Chairman and head of the
State.
Highly centralized bureaucratic system
Nationalized industries vs. state owned enterprises
(SOEs)
SOEs: the government set targets for production, allocated labour, appointed management, arranged
Danwei and Hukou: key systems under Mao’s regime
Danwei were work units of workers
Little opportunities for workers to change jobs
Important control and surveillance functions
Control on people’s freedom of movement
Household registration system (Hukou)
State policy changes since 1976
1976, Deng Xiaoping takes power and initiates far-reaching economic reforms.
1978 at 11th CCP Central Committee criticizes
‘Leftist’ policies
Chinese government restates