Location is key, also for economists - Shaun Rein

Shaun Rein

Chinese New Year is ahead and economists have their predictions about the country's economy ready. Much of their gloomy prospects Over-investment, too much debt, bubbly markets, faked data, Ponzi-like financial structures) depends on their location, observes business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order, according to Bloomberg. Those located in China tend to get the uptick in the economy better than those observing China from afar.

Bloomberg:

That negativity is a sharp contrast to the majority opinion held closer to Beijing or Shanghai. There, booming consumption, a pickup in global trade, and an increasingly innovative private sector are fueling bets that China’s generation-long economic miracle still has plenty of room to run, albeit at a slower rate than the average gross domestic product growth of almost 10 percent a year since the early 1980s. “I find it scary how many self-proclaimed US based China experts w real influence have barely lived in China, barely speak Chinese and barely have a clue …” tweeted Shaun Rein, Shanghai-based founder and managing director of China Market Research Group and author of The War for China’s Wallet, on Dec. 26. Later he was on Twitter again, wagering that the “same tired group of China’s watchers will predict China’s collapse for the 40th year in a row… and they’ll be wrong for the 40th time but western media will keep quoting them breathlessly as experts.”

Shaun Rein@shaunrein

It's almost time for New Year's Predictions on China's economy - my prediction? Same tired group of China's watchers will predict China's collapse for the 40th year in a row... and they'll be wrong for the 40th time but western media will keep quoting them breathlessly as experts

6:28 AM - Dec 27, 2017

More in Bloomberg.

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The 2018 Tencent Report - Matthew Brennan

Matthew Brennan

Tencent is one of the world's largest and most influential IT companies, but very few know what the company looks like. WeChat expert Matthew Brennan made for China Channel the Tencent Report, a short introduction to the company.

Matthew Brennan is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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Tencent Report 2018 (v.1.1) from Matthew Brennan

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Mao killed more than Stalin or Hitler - Ian Johnson

Ian Johnson

Who killed more, Hitler or Stalin, is a question often asked. Journalist Ian Johnson, author of The Souls of China: The Return of Religion After Mao, argues - 60 years after the Great Leap Forward started - that Mao Zedong is often wrongly excluded from this debate. But he opts for a nuanced approach in The New York Review of Books, although in numbers Mao beats both Stalin and Hitler.

Ian Johnson:

Yet all these numbers are little more than well-informed guesstimates. There are no records that will magically resolve the question of exactly how many died in the Mao era. We can only extrapolate based on flawed sources. If the percentage of deaths attributable to the famine is slightly changed, that’s the difference between 30 and 45 million deaths. So, in these sorts of discussions, the difference between one and two isn’t infinity but a rounding error. 

Mao didn’t order people to their deaths in the same way that Hitler did, so it’s fair to say that Mao’s famine deaths were not genocide—in contrast, arguably, to Stalin’s Holodomor in the Ukraine, the terror-famine described by journalist and historian Anne Applebaum in Red Famine (2017). One can argue that by closing down discussion in 1959, Mao sealed the fate of tens of millions, but almost every legal system in the world recognizes the difference between murder in the first degree and manslaughter or negligence. Shouldn’t the same standards apply to dictators? 

When Khrushchev took Stalin off his pedestal, the Soviet state still had Lenin as its idealized founding father. That allowed Khrushchev to purge the dictator without delegitimizing the Soviet state. By contrast, Mao himself and his successors have always realized that he was both China’s Lenin and its Stalin. 

Thus, after Mao died, the Communist Party settled on a formula of declaring that Mao had made mistakes—about 30 percent of what he did was declared wrong and 70 percent was right. That’s essentially the formula used today. Mao’s mistakes were set down, and commissions sent out to explore the worst of his crimes, but his picture remains on Tiananmen Square. 

Xi Jinping has held fast to this view of Mao in recent years. In Xi’s way of looking at China, the country had roughly thirty years of Maoism and thirty years of Deng Xiaoping’s economic liberalization and rapid growth. Xi has warned that neither era can negate the other; they are inseparable. 

How to deal with Mao? Many Chinese, especially those who lived through his rule, do so by publishing underground journals or documentary films. Perhaps typically for a modern consumer society, though, Mao and his memory have also been turned into kitschy products. The first commune—the “Sputnik” commune that launched the Great Leap Forward—is now a retreat for city folk who want to experience the joys of rural life. One in ten villagers there died of famine, and people were dragged off and flayed for trying to hide grain from government officials. Today, urbanites go there to decompress from the stresses of modern life. 

Foreigners aren’t exempt from this sort of historical amnesia, either. One of Beijing’s most popular breweries is the “Great Leap” brewery, which features a Mao-era symbol of a fist clenching a beer stein, instead of the clods of grass and earth that farmers tried to eat during the famine. Perhaps because of the revolting idea of a brew pub being named after a famine, the company began in 2015 to explain on its website that the name came not from Maoist history but an obscure Song dynasty song. Only when you’re young and fat, goes the verse, does one dare risk a great leap.

Much more in the New York Review of Books.

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Zhejiang: the new hot spot for billionaires - Rupert Hoogewerf

Rupert Hoogewerf

Zhejiang province, with its capital Hangzhou, have developed into a preferred destination for billionaires, says Rupert Hoogewerf, founder of the Hurun China rich list. Zhejiang not only passed domestic cities like Beijing and Shanghai, but also Paris and San Francisco in the 2018 Hurun report, writes the Digital Journal.

The Digital Journal:

Explaining the winning formula of the province to CNNMoney in 2016, Jack Ma, billionaire CEO of leading online platform e-commerce platform, Alibaba, and native of Hangzhou in Zhejiang, had attributed the economic achievements of the province to “It's... surroundings, culture, (and) history". 

Today, such environment, culture, and history cited have seen the region produce 72 billionaires, 32 of which live in the capital city of Hangzhou - that's two more than Paris and four more than California's San Francisco. Notable among the 72 billionaires from the region are Neil Shen, founder of Sequoia Capital China; Ding Lei, founder of NetEase; and Li Shufu, founder of Geely Auto Group, which owns Volvo and is based in Hangzhou. With a population that makes up just about 5% of China's population, the region produces about 15% of the country's richest people, according to Rupert Hoogewerf, chairman, Hurun Report. 

But that's not all. Beyond the individual billionaire count, Zhejiang's overall economic stats are equally mouth-watering. With a staggering GDP of 5.1768 trillion RMB which is 766.7 billion USD for the year 2017 (bigger than the GDP of Netherlands in 2016!), the Province of Zhejiang has become a glowing haven of wealth creation.

More in the Digital Journal.

Rupert Hoogewerf is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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Lifting branding to a new level - Tom Doctoroff

Tom Doctoroff

Deep insight in consumer behaviour is what marketing should offer, writes branding guru Tom Doctoroff, author of What Chinese Want: Culture, Communism, and China's Modern Consumer, on his LinkedIn page. Cluttering that insight with "exaggerated faith in algorithms, programmatic efficacy and hyper-personalization," is not helpful he adds. And: "Insights are not observations."

Tom Doctoroff:

Technological innovation is not the only starting point for branding, customer experience, and product development. A brand’s relentless relevance must also spring from deep insight into consumer behavior. In an era characterized by exaggerated faith in algorithms, programmatic efficacy and hyper-personalization, marketers should answer a higher calling to embrace psychology and cultural anthropology to penetrate the souls – and lives -- of consumers. 

Insights are not observations. They latter record what people say or do.  The former reveal inner desire.   

The first character of the word insight in Chinese is dong, which means “hole.” It is a fitting parallel; insights into consumer behavior are deep.   They need to be unearthed.  Insights explain fundamental motivations for behavior and preference, answering the question “Why?” More specifically, this article advocates the most powerful insights are tensions – between and within cultural and/or human truths – and brands must use them maximize relevance. 

It’s worth noting global brands often struggle to maintain relevance across far-flung markets because they ignore the importance of underlying urges in determine buying behavior. Some of the greatest failures in China, for example, have been caused by cultural tone deafness. Ebay didn’t appreciate the need for reassurance when making virtual transactions. Kellogg cereal misjudged the importance of a “mom’s warm hug” in the morning when launching cold, crunchy breakfast cereal. Best Buy underestimated price sensitivity when promoting the expertise of in-store sales personnel. 

Across the developing world, Unilever’s Dove “Real Beauty” positioning – advocacy of women defining their own standards of attractiveness irrespective of social context -- fell flat because the brand failed to appreciate the role of external admiration in non-individualistic markets such as the US and Europe.

Much more at LinkedIn.

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Old trade warrior Robert Lighthizer leads the US fight against China - Arthur Kroeber

Arthur Kroeber

Robert Lighthizer was sworn in as US trade representative in May last year. He is the key person to watch when a trade war between China and the US is developing, says leading economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®, in the South China Morning Post.

The South China Morning Post:

After scant progress was made in the first round of Comprehensive Economic Dialogue with Beijing in July – aimed at resolving trade issues – the US suspended the high-level talks. 

Last month, Lighthizer said there had been no effective result from senior-level dialogue between the two countries, and now the Trump administration is taking serious aim at the trade deficit with China, and considering further action to restrict Chinese involvement in its hi-tech sector. China’s trade surplus with the United States rose 8.6 per cent last year to a record high of US$275.8 billion, according to official Chinese data. 

“The combative Lighthizer is now firmly in control of the international trade and economics agenda,” said Arthur Kroeber, a founding partner with Gavekal Dragonomics.

“It was only in the second half of last year that the US Trade Representative Robert Lighthizer wrested trade policy from more accommodating figures like Commerce Secretary Wilbur Ross and economic adviser Gary Cohn,” Kroeber said, describing Lighthizer as an “old trade warrior who cut his teeth battling Japan in the 1980s”.

More at the China China Morning Post.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form. 

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Why Trump's approach to trade deals fails - Harry Broadman

Harry Broadman

The world had one year to get used to Donald Trump's approach to trade deals: bilateral trade deals rather than plurilateral regional trade deals. Former World Bank official Harry Broadman explains for Forbes why Trump's approach for international deals is going to fail.

Harry Broadman:

In the year that he’s occupied the Oval Office, President Trump has left many eye-catching imprints on the way he has positioned the U.S. to act unilaterally with the rest of the world’s economies. Perhaps nothing is more notable in this context than the Negotiator-in-Chief’s penchant for championing the negotiation of bilateral trade deals. The May 2017 China-U.S. agreement was his first foray into this practice, which received far more press attention than it merited, and to date has borne little tangible fruit. And, overhanging the current renegotiation of NAFTA—a plurilateral regional trade agreement—is Trump’s threat, which I think of as "Threatenomics", to simply dissolve the treaty in whole and instead work out two separate bilateral agreements, one with Mexico and one with Canada. 

Trump has asserted he could potentially envision pursuit of broader multilateral trade deals based on the World Trade Organization’s (WTO) bedrock ‘Most Favored Nation’ (MFN) principle—where all 164 WTO signatories automatically are afforded uniform, non-discriminatory treatment. Such agreements, of course, stand in contrast to bilateral deals, where, by definition, the included parties treat each other on more favorable terms than either extends to all excluded countries. Hence why they are officially referred to as ‘preferential trade agreements’ (PTAs). 

But in his heart, Trump sees international trade negotiations as ‘Bilateral Man’—hardly surprising for someone who cut his teeth conducting real estate transactions in New York. Indeed, he’s noted on several occasions recently that he can get a far better bargain taking up trade agreements with other heads of state on a bilateral basis. 

Yet in the complex, nuanced world of international trade agreements, it really is not the “either or choice” Trump makes it out to be. The WTO specifically allows for preferential agreements—whether structured on a bilateral or a plurilateral, regional basis-- as long as they meet certain criteria specified within the WTO agreement. In fact, with the 2016 bilateral trade agreement between Japan and Myanmar now in place, allWTO members are party to PTA's in one form or another.

More in Forbes, full text republished with the kind approval of Harry Broadman TRUMP BILATERAL JAN 2018

Harry Broadman is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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How to brand your message in China - Tom Doctoroff

Tom Doctoroff

Stability and tradition in China are much stronger over the generations than many outsiders assume, marketing guru Tom Doctoroff, author of What Chinese Want: Culture, Communism, and China's Modern Consumer, argues in this video clip for Amcham. Tensions between generations do exist in China too, but they are different from those elsewhere in the world, he argues.

Tom Doctoroff is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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Alibaba needs older customers to maintain growth - Ben Cavender

Ben Cavender

E-commerce giant Alibaba launched this week a special app for the older people at Taobao, its online shopping website. A logical step, says retail analyst Ben Cavender to Reuters. “It’s easier now than it was in the past to get some of these older users to actually open up their wallets and spend.”

Reuters:

The company on Wednesday announced the launch of an “elderly friendly” version of its shopping app Taobao after causing an online stir this month by posting job adverts for candidates over 60 to act as consultants to promote the app and provide feedback. 

“The big motivator here is that their revenue growth is slowing,” said Benjamin Cavender, Shanghai-based principal at China Market Research Group. “It’s easier now than it was in the past to get some of these older users to actually open up their wallets and spend.” 

Trying to appeal to the elderly fits in with Alibaba’s $10 billion-plus spending spree to raise its presence in brick-and-mortar stores, which are frequented more often by older shoppers.

More at Reuters.

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Tencent's investment positive for Wanda - Ben Cavender

Ben Cavender

Dalian Wanda Group’s commercial property arm secured a US$5.4 billion investment from a group led by tech giant Tencent Holdings, a major move for the troubled real estate giant, hoping to get a Shanghai IPO, says business analyst Ben Cavender to Reuters.

Reuters:

The 34 billion yuan deal for a 14 percent stake in Wanda Commercial could also help the unit get back on track with a plan to relist in Shanghai after a bold and ultimately expensive decision to withdraw from the Hong Kong exchange in 2016. 

“From Wanda’s perspective it seems a good deal. They’ve overextended with expansions and acquisitions over the last couple of years,” said Ben Cavender, Shanghai-based principal at China Market Research Group, adding that Wanda Commercial had now become a more “attractive mainland IPO candidate”. 

The stake will be bought from existing investors who had been part of the $4.4 billion buyout fund created for Wanda Commercial’s delisting in 2016. Those investors had been promised up to 12 percent annual interest if it failed to relist in Shanghai within two years. 

The Shanghai IPO has, however, been held up by mainland regulatory measures to tighten liquidity in the real estate sector. Wanda said in a statement that with its new investors it was looking to take the unit public “as soon as possible”. 

The Tencent-led group includes major retailer Suning Commerce Group, e-commerce firm JD.com Inc and rival developer Sunac China, which bought some of Wanda’s theme park assets last year. 

“The tech companies are seen as the darlings of China’s emergence as a global superpower. So, reputation-wise I think this is a good move for Wanda,” Cavender said.

More at Reuters. Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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How the Vatican changed its position to China - Ian Johnson

Ian Johnson

The Roman Catholic Church at the Vatican has shocked its communities in China by asking two "underground" bishops by complying to the country's rulers. Journalist Ian Johnson, author of The Souls of China: The Return of Religion After Mao, tries to make sense out of the move for the New York Times.

Ian Johnson:

In a statement released on Monday, the former bishop of Hong Kong, Cardinal Joseph Zen, confirmed the broad outlines of the Vatican’s recent efforts, writing that he traveled to Rome this month to personally deliver to the pope a letter from an underground bishop who had refused to resign. 

The letter came from Bishop Zhuang Jianjian of the southern Chinese city of Shantou, an 88-year-old who had been secretly ordained in 2006 with Vatican approval. 

In December, Bishop Zhuang was escorted by government officials to Beijing, where he was taken to the Diaoyutai State Guesthouse to meet a papal delegation believed to have been headed by Archbishop Claudio Maria Celli, who leads the Vatican’s China negotiating team... 

In his statement on Monday, Cardinal Zen said that when he delivered Bishop Zhuang’s letter to the pope, the pontiff expressed sympathy for the underground bishops, telling the cardinal that his negotiators should not “create another Mindszenty case,” a reference to a pro-democracy bishop in Hungary who was forced out of his country in 1956 and replaced with a person acceptable to the government. 

Cardinal Zen wrote that he had been heartened by the words. “I was there in the presence of the Holy Father representing my suffering brothers in China,” he said. “His words should be rightly understood as of consolation and encouragement more for them than for me.” 

The Rev. Bernardo Cervellera, the editor of Asianews.it, said the developments showed that Vatican negotiators were prepared to give the Chinese government “carte blanche, and accept all requests and pose no opposition on questions that affect the church in China.” 

But Father Cervellera said the pope’s reported comments to Cardinal Zen may have signaled that he was not entirely in agreement with his negotiators. 

People following the issue said that the highly unusual series of events showed how badly the Vatican wanted a deal. 

“The fact that both sides can carry on the negotiation till now shows that the Vatican must consider this a rare opportunity,” said Wang Meixiu, a researcher on Chinese Catholicism at the Chinese Academy of Social Sciences in Beijing. 

Dr. Chen (Dr. Chen Tsung-ming, research director at the Ferdinand Verbiest Institute) in Belgium said that one reason for the Vatican’s eagerness was a sense that the faith had been growing relatively slowly compared with other religions in China. While the number of Protestants has grown from one million in 1949 to at least 50 million today, the number of Catholics has largely tracked population growth, increasing from three million in that period to at most 12 million today, in part because of the schism in the Chinese Catholic Church. 

The pope’s background as a priest in the Society of Jesus may also play a role, Dr. Chen said. Jesuits arrived in China more than 400 years ago, establishing a permanent presence for the church on the mainland after several failed efforts in earlier centuries. But they did so by being extremely flexible and conforming to local norms — a point that may be informing the pope’s negotiating approach. 

“He has a sense of mission,” Dr. Chen said. “There’s a historic responsibility.”

More details in the New York Times.

Ian Johnson is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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Why BuzzFeed is likely to fail in China - Shaun Rein

Shaun Rein

News aggregator Jinri Toutiao agrees to distribute content from American media outlet BuzzFeed to a Chinese audience, the Sixth Tone reports. After failures to start media operations in China by Rupert Murdoch, Google, Yahoo, Facebook, Time Warner and Viacom - to mention a few - you can see business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order shaking his head in disbelieve, as he comments on the move.

The Sixth Tone:

ByteDance, Toutiao’s parent company, will publish BuzzFeed’s videos to hundreds of millions of users across multiple platforms, according to a statement released Thursday. The financial details of the licensing deal have not been disclosed. 

BuzzFeed, known for its fun and often viral content, will have to “jump through some regulatory hoops” to be successful in China, said Shaun Rein, founder of the Shanghai-based consulting firm China Market Research Group and author of the book “The War for China’s Wallet.” 

“The risks are really high, to be honest,” Rein told Sixth Tone. In addition to creating eye-catching content, he added, BuzzFeed does not tend to shy away from tackling weighty political issues.

More in the Sixth Tone. Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at you your meeting or conference? Do get in touch or fill in our speakers' request form.

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The self-driving car: the next disruptive tool - Mark Schaub

Mark Schaub

No tool has changed life in China more than the smartphone, with 640 million users and counting in less than a decade. But a new device is possibly disrupting - and improving - life even more, writes Shanghai-based lawyer Mark Schaub in the China Law Insight: the self-driving car. He paints the upcoming changes, and the way China's government is promoting that change.

Mark Schaub:  

There is probably no nation which loves smartphones more dearly than China – all 640 million of them.  In China smartphones are used to pay bills, make bank transfers, buy a coffee, hail a taxi, organize a train ticket, order food delivery, hire a house cleaner, hire a chef, messaging, browse the internet and in some rare cases they are even used to call people. 

If you look in any public place in China almost everyone has a device in hand and eyes intently glued to the screen. You see it when couples are on dates. Even when driving mopeds. 

The really amazing thing about smartphones is not that they are widespread (they are great) but how quickly this happened. The first Apple iPhone was launched in only 2007.  At the time of launch there were many disbelievers: Steve Ballmer of Microsoft said “No chance of any significant market share”, the Nokia CEO said “It doesn’t change our thinking”. The smartphone shows that consumers can quickly adopt new technology. 

Adoption of autonomous vehicles will result in massive disruptions to market, rewriting of regulations, new challenges for infrastructure and new services will be adapted to this new “device”. These changes will only accelerate further adoption until these new “ride-able” devices will also become integral to our daily lives. 

The opportunities (and risks) of autonomous cars for automobile manufacturers and their suppliers are readily apparent. However, there is also a tremendous opportunity for service providers in developing services for autonomous vehicles. Between them the two largest Application (APP) platforms in the world, Google Play and Apple, have over 5 million APPs available (although there is a degree of overlap between Android and Apple versions of the same APPs)[1]. 

Many of these APPs would be applicable to driverless cars and many new ones with novel functions will spring up. Traditional APPs such as looking up the weather or watching a streaming movie will also be applicable to driverless cars, but new more specific functions will be required such as more detailed mapping, parking and traffic information as well as tracking fuel and various other automobile consumables and location of service providers to refill such consumables. Ultimately, a driverless car is pointless if it still needs a driver to perform these functions. Accordingly, fully integrating driverless cars into the Internet of Things (“IoT”) revolution will allow for interoperability between your car and the relevant service providers. These cars will need to fill up, park and go in for maintenance without human guidance. Freeing up drivers from these tasks will pose a challenge for the widespread adoption of driverless cars but also provides opportunities for service providers.

More in the China Law Insight.

Mark Schaub is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

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How to deal with China as a partner - Shaun Rein

Shaun Rein

Business analyst Shaun Rein author of The War for China's Wallet: Profiting from the New World Order defines three different relations China can have with other countries: hot, warm or cold partners. From Cambodia he reports how a hot partner like Cambodia can deal with its powerful neighbor, according to the Phnom Penh Post. 

The Phnom Penh Post:

 I don’t think China is trying to forge alliances; instead, it is looking to use economic carrots and sticks to convince countries to either do its political bidding (a Hot Partner country like Hungary, Ethiopia or Cambodia) or to punish countries that cross it politically (a Cold Partner country like India or the Philippines and the Aquino administration). It knows it can never be truly close with any country in the long-term, so instead it tries to dole out low-interest loans and infrastructure investments to countries to make them open to China’s political aims in the short term. Meanwhile, countries that cross China politically, as South Korea did by installing Thaad missiles, get punished. China blocked Chinese tour groups from visiting South Korea last April, causing a 40 percent drop in annual tourist visits and crippling the South Korean economy. 

If Cambodia is a ‘hot partner’ with China, what does this mean for Cambodia’s economy and development? And what does China gain from the relationship?  

Cambodia’s [Prime Minister] Hun Sen has been quite savvy in his dealings with China over the past decade. He has supported China’s views on the South China Sea during summits of Asean. Having a supportive country in Asean like Cambodia is to counter criticism of China’s policies by countries like Vietnam or the Philippines, and causes China to look to invest more in infrastructure development in Cambodia and to give it low-interest loans. Moreover, the Chinese government uses its control of the state-owned media to tout the historical landmarks in Cambodia like Angkor Wat. Right now, Cambodia is one of the top destinations Chinese tourists want to visit. I am very bullish on Cambodia’s ability to attract Chinese tourists to its landmarks and high rollers to its casinos. This is all gained by being a friend of China in the “hot partner” category. 

One of the problems of becoming a “hot partner” country is that these countries often become too dependent on China economically and start to lose political independence. China’s economy is so large that if a country gets punished for crossing China politically, then it will have a real impact, as in the South Korean case. 

On the one hand, it is good to get close to China politically, as nations will reap economic benefits, but it comes at a cost of losing political independence so countries should try to be close to China but also distance itself at times, as the United Kingdom or France has done, so that they are not viewed as lackeys of the Chinese government.

More in the Phnom Penh Post.

Shaun Rein is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch  or fill in our speakers' request form.

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Religion: a way to restore some order in China - Ian Johnson

Ian Johnson

The less-than straightforward relation between China's communist rulers and religion is one of the complicated concepts author Ian Johnson of The Souls of China: The Return of Religion After Mao tries to explain. From repression, to tolerance and now moving to a idea to use religion to restore some order, that relationship has changed profoundly, he tells The Politic, although it varies depending on what religion you look at.

The Politic:

President Xi Jinping´s administration has embraced different traditions, including religious ones, that serve his party. Can you talk a little bit about this, what has he done, and why is it important now that he has been re-appointed for another five-year term? 

After he took power in 2012, he very quickly made a series of highly symbolic visits. He visited the hometown of Confucius in Qufu, and he prayed to Confucius. He made another visit to UNESCO in Paris and praised Buddhist tradition, and he also had public meetings with Buddhist leaders. So then, they began to push this propaganda campaign of the China dream—this is Xi Jinping’s signature slogan—and this dream is a national rejuvenation, but it’s also social justice, and they use traditional images and traditional ideas and concepts to promote that. 

That was the beginning of the efforts. This is one of the reasons he is very popular, and it’s probably because they feel that society went out of control. His campaign against corruption is very popular, [the thinking is], “Yes, we need to stop corruption, but we also we need some kind of frame to get society in order.” 

If you think about it broadly, you got the Mao Era, and the Reform Era, and then the government backed away from the control of society, and they let people do what they wanted to do as long as they didn’t challenge the government. By the 2000s, people thought that things had gotten out of control. The internet was coming up, [new] NGOs were forming, and they didn’t want the Party to be challenged. So, starting before Xi Jinping, but especially after he took power, there’s been this effort to reassert control over society. I think they see religion as a useful tool in the overall effort to restore some sort of order in society. 

From what I understand, in the 19th century, religion and politics were very intertwined. And now, apparently, it is becoming intertwined again, so how are people receiving these changes? And what are the implications of this? 

Well, I don’t think they can go all the way back. In the old system, the emperor was a quasi-deity, the son of heaven. 

One implication is that there are other religions in China besides the ones the government is happy to support. The government is comfortable with Buddhism, Daoism, these so-called traditional religions, but it is less comfortable with Christianity and Islam, which also have significant populations. I think this could be a source of tension in the future. Already there are quite Islamophobic bloggers who write against Islam and question whether Islam is part of China. Actually, Islam has been in China for over a thousand years, so it’s not like it arrived last year. And about half of the Christians of China are not part of the official church, they are part of unregistered churches. I think they want to make them register with the government, those roughly thirty million Christians, and that’s going to be difficult, it can cause a lot of tensions. 

Why do they oppose Christianity and Islam? 

I think they don’t oppose it per se. I think what they don’t like is the foreign influence, foreign ties. It is the same with NGOs. NGOs in China can form, but they can’t take foreign money. So, with Christianity and Islam, you have inherent foreign ties. In Catholicism, bishops must be appointed by the Vatican, and in Protestantism, you also have ties with global, Evangelical movements. They send, not missionaries, but trainers, especially Chinese-Americans who come with a tourist visa and then teach and train pastors. Then, Islam also has a really strong global component, for example with the pilgrimage to Mecca. Some countries also want to donate money to build mosques, and the government is always trying to limit that. 

More in The Politic.

Ian Johnson is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more strategic experts at the China Speakers Bureau? Do check out this list.

Rich more optimistic about China's future - Rupert Hoogewerf

Rupert Hoogewerf

China's high-net-worth individuals are more optimistic about the country's economic development compared to last yet, says the Hurun Chinese Luxury Consumers Survey 2018, released on Wednesday, according to the China Daily. Rupert Hoogewerf, founder and chief researcher of Hurun, said that although China's GDP growth rate was 6.9 percent last year, which is slightly up from the 6.5 percent estimated by the central government at the beginning of 2017, it is enough to make a difference.

The China Daily:

The Shanghai-based Hurun Research Institute, which conducted the study, said that only 6 percent of the respondents were pessimistic on prospects, while that number was 9 percent a year ago. 

Rupert Hoogewerf, founder and chief researcher of Hurun, said that although China's GDP growth rate was 6.9 percent last year, which is slightly up from the 6.5 percent estimated by the central government at the beginning of 2017, it is enough to make a difference. 

As a result, 72 percent of the respondents－up from 65 percent last year－expected that China and the United States will run neck and neck in terms of economic development in the next decade. About 37 percent said that China is likely to overtake the US in 10 years, which is up from 28 percent a year ago. 

It is the 14th consecutive year that Hurun has released this list. About 58 percent of the surveyed high-net-worth individuals this year, who have not immigrated yet, expressed no such plans, a historic low since 2011. In addition, overseas investment dropped out from the top five personal investment channels. As explained by Hoogewerf, it reflects the rich individuals diverse interests in the domestic market. 

Liquor band Kweichow Moutai is the only Chinese brand that figures in the top 10 favorite brands for gifting. According to Hoogewerf, wealthy individuals' preference of brands for gifting has consolidated over time, which means that they are extremely loyal to certain brands and will not opt for a substitute easily even if the new products are a hit in the market. 

In terms of recreation and activities, sailing took the second spot among the activities that Chinese high net worth individuals want to try in the next three years, next to equestrianism.

More in the China Daily. Rupert Hoogewerf is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

Are you looking for more experts on luxury goods at the China Speakers Bureau. Do check out this list.

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Why AI works better on WeChat than on Facebook - William Bao Bean

William Bao Bean

Chinese companies are making great strides in using machine learning or AI. One of the reasons is that  China's WeChat is better fit than Facebook to integrate this disruptive tool, says William Bao Bean, director or the  Chinaccelerator to eMarketer about influencer marketing in China.

EMarketer:

Bean: One of our companies, OCheng, is applying AI to WeChat commerce. WeChat service accounts are allowed to send a message to their followers once a week. OCheng can take customer relationship management data, look at the content people are engaging with, their purchase history, etc., and use machine learning to personalize these weekly messages. Instead of sending one message to a million people, you can send a million messages that are unique to each user every week. 

eMarketer: Is this process entirely automated? 

Bean: The content has to be written around the products the marketer is pushing that week. But the way the messages are written and the offers that are being shown to each person are personalized through automation. And when users write back, an AI-assisted chatbot can answer their questions. You not only have personalized content going to each user, but you can also have one-on-one conversations with WeChat users without a human, or you can have a chatbot and human working together. 

eMarketer: What types of brands are working with the tech? 

Bean: The Richemont Group, Dunhill, Macallan and Sephora are some of the brands that are leveraging this type of technology to drive higher sales. It’s not some pie-in-the-sky platform for them—it’s about dollars and cents, and there’s real ROI [return on investment]. 

eMarketer: Is it easier to achieve this on WeChat than Facebook? 

Bean: You can do a lot more within WeChat because it’s a more open platform than Facebook. A lot of the techniques you use on WeChat you can also use on Facebook. Facebook should start catching up, but the difference is how the two platforms make money. WeChat makes money on transactions, whereas Facebook makes money on ads. Facebook wants to capture ad revenues, whereas [WeChat parent company] Tencent wants to capture the commerce aspect. Marketing is important, but the opportunity to capture a percentage of the transaction as opposed to a percentage of the marketing budget is a bigger opportunity over time. 

eMarketer: In what other areas is machine learning being deployed to improve marketing outcomes? 

Bean: Influencer marketing is big in China. Influencer platform Robin8 uses machine learning and natural language processing to analyze the content that key opinion leaders [KOLs] push out, and then analyze the impact—who’s engaging with that content. Robin8 can do end-to-end attribution from KOLs all the way through to purchases on WeChat. This gives marketers an idea of what kind of content from which KOL works with different types of users, and they can optimize their KOL buy.

More in eMarketer.

William Bao Bean is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form. Are you looking for more experts on innovation at the China Speakers Bureau? Do check out this list.  

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