How Tencent moves to B2B - Matthew Brennan

Matthew Brennan

Tencent watcher Matthew Brennan has an in-depth look at how the recent reorganization of the internet giant reflects on the internet in China, especially how the company that became big through WeChat and B2C moves towards a more industrial approach, he writes on his weblog at China Channel.

Matthew Brennan:

“From the management side, the biggest challenge we face is internal organization. Right now Tencent needs to get better at doing B2B.” – PonyMa, Tencent Annual Internal Staff Meeting 2017 Dec 15^th. 

This quote is from the annual Tencent internal staff meeting last year, it shows the higher management have been aware for a considerable time that change in organizational structure and strategic focus were necessary. Pony Ma when he has given public talks over the past year, they have mostly been focusing on the areas of B2B business most often mentioned would be Tencent’s smart retail solutions. 

It seems that higher management has decided that the development of Tencent’s B2B solutions will decide the future potential of the company. B2C business has peaked as the number of mobile internet users has passed its rapid growth stage. User growth for most major internet companies has declined considerably. 

Yet when doing B2B internet business in China, Tencent will undoubtably find themselves competing with their arch rival Alibaba and this competition will be tough. Alibaba unlike Tencent has B2B in their blood. From the early days their company started out with the incredibly tough job of making sales of their internet services to factory owners who’d never heard of the web before. Persuading them of the merits for this new way of gaining clients without meeting them in person. 

“Many people said we only have ‘B2C’ in our DNA. B2B is not in our blood. I don’t believe that. I think that every evolutionary successful species holds characteristics that weren’t there at the beginning but were evolved over time.”- Martin Lau, Tencent Internal Staff Meeting 2017. 

Tencent’s traditional strength throughout it’s 20 years of existence has always been in B2C. They have a proven understanding of how to monetize large user bases. They have access to the deep social graph of Chinese internet users and they are consistently able to produce products that Chinese consumers love to use. 

Apart from investment income, Tencent’s main profit model today is to accumulate new users, cultivate their usage habits over time, and make profits eventually through games, user fees, and advertising. This monetization could be said to be a long and indirect process. By contrast, the revenue earned from B2B businesses appears to be more direct and the clients are often stickier. Once the relationship is established, transactions will continue, and the income is more stable than B2C.

Much more at the China Channel.

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Trump focuses trade war on China - Arthur Kroeber

Arthur Kroeber

The new trade agreement between the US, Mexico, and Canada (USMCA)  excluded possible free-trade agreements between the three with China. Trump has its hands free to focus his trade war on China, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know®, at the South China Morning Post. 

The South China Morning Post:

After US-imposed tariffs on an additional US$200 billion worth of Chinese products last month and China’s subsequent rejection of a US invitation to hold talks to ease the dispute, Chinese President Xi Jinping toured his country’s northern rust-belt region, sending a message that China would have to rely on itself for future development. 

Arthur Kroeber, research head and co-founder of the economic consulting firm Gavekal Dragonomics, wrote in a note on Tuesday that the USMCA may put an end to Trump’s trade position of “picking fights with anyone and everyone”. Washington, he said, would focus its fire on the nation it perceives as the real trade enemy: China. 

“The US has confined its economic warfare to a single battlefield, but the fight will be a long one,” Kroeber said.

More at the South 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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Income tax reform: more spending or saving? - Sara Hsu

China has changed its income tax for the first time in seven years, beneficial for the lower income groups, and less for the high earner. Financial analyst Sara Hsu discusses the purpose: more spending might be a motive, but as aging and health care costs loom, many might opt for saving, she says at CGTN.

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

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Divided Catholics face Beijing-Vatican deal - Ian Johnson

Ian Johnson

China's central government and the Vatican closed a deal on appointments of Catholic bishops in China, causing debate among the already divided Catholics in the country, writes journalist Ian Johnson, author of The Souls of China: The Return of Religion After Mao at the New York Times. The way the Communist-ruled state church might integrate with the Roman Catholic church might not please all Catholics, he writes.

Ian Johnson:

Several underground bishops in China, including two popular bishops in staunchly Catholic parts of the country, are expected to step down to make way for the bishops appointed by Beijing over the past decade whom the pope has agreed to recognize. In exchange, the pope is gaining some role in the appointment of new bishops. There are about 100 bishops and prelates in China, including underground and approved, and a dozen vacant positions. 

Exactly how this will work is unclear. Both sides have described the agreement signed on Saturday as preliminary, and neither has released details. But some informal veto system seems likely. The Vatican could reject candidates suggested by the Chinese authorities, although mainly through quiet consultation rather than formal voting. 

In the long run, diplomatic ties could be restored between Beijing and the Vatican.

Some Chinese Catholics see this as helping a church that has been unable to respond to changing times. China is rapidly urbanizing, for example, but many rural Catholics find little outreach when they migrate to take jobs in the cities. A unified church could address that. 

“I think if it helps unite the church, then it’s a good thing,” said You Yongxin, a Catholic writer based in the eastern Chinese city of Fuzhou. “If the pope is convinced he can get good bishops appointed through this deal, then we have to trust that he will.” 

Indeed, if carried out as advertised, the deal would give the church a formal role in appointing clergy members in party-controlled churches in China for the first time in nearly 70 years. That would be a significant concession by the government. By contrast, Beijing doesn’t give the spiritual leader of Tibetan Buddhists, the Dalai Lama, any say over the appointment of monks or abbots.

Still, the deal came as a shock for many Chinese Catholics. 

Paul Dong Guanhua, a self-ordained bishop in the underground church in the northern Chinese city of Zhengding, said it made no sense that Beijing would sign on to any deal that could strengthen the church. 

“Well, if there’s an agreement, there’s an agreement,” he said in a telephone interview. “But I find it absurd, and I wonder how many other Catholics can agree with this decision.” 

Other prominent underground clergy members, like Guo Xijin, one of the bishops who reportedly would have to step down under the deal, could not be reached for comment. In an interview earlier this year, Bishop Guo told The New York Times that he would step down if asked by the pope. 

Rome will also have to win over skeptical Catholics in Taiwan and Hong Kong, said Lawrence C. Reardon, a professor of political science at the University of New Hampshire who studies Beijing-Vatican relations.

More in the New York Times.

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Tariffs will hit US consumers - Sara Hsu

Sara Hsu

The trade war between the US and China has up to now mainly hit headlines, nervous traders and heated political debates, but there is no doubt consumers will feel the burnt too, says financial analyst Sara Hsu to Reuters. Moving away from China is mostly not an option, she says. "It can take up to five years to move from China to another country."

Reuters:

U.S. tariffs on imports from China will not only impact companies but also the consumers said an expert in an interview with China Global Television Network in Beijing on Tuesday. 

Sara Hsu is an associate professor of economics at the State University of New York at New Paltz. She said it was not clear what percentage of the tariffs the companies would pass on to the consumers but it would definitely impact the consumers. 

“It’s definitely going to impact the consumers in terms of higher cost as well as the companies. So there might be a split in terms of the company taking part of the hit and passing part of cost on to the consumers as well. And starting from January 1, the tariffs will go from 10 percent to 25 percent. So that’s a really significant increase,” said Sara. 

China is the largest supplier of textiles and apparel to the U.S. market, accounting for about 40 percent of American imports in the sector, according to the statistics of the United States Fashion Industry Association (USFIA). 

The industry relies on sourcing from China to provide American consumers with affordable and varied choices. But the tariffs will impact the multinational companies in the U.S. in the industry, said Sara. 

“A lot of the American multinational firms are producing their goods overseas. So that’s why the tariffs on exports from China are going to impact the American multinational companies. And these multinational companies would like to move to a different place, especially given the tariffs that just kicked in. But it’s really hard for them to do,” said Sara. 

She added that there would be a high cost for the companies to move and set up shops in other countries with a level of development and have low wages. 

It can take up to five years to move from China to another country, Sara said. The situation hasn’t happened yet, but a lot of companies are not reassuring to the U.S. instead of relying on automation in order to produce their products because American labor costs so high.

More at Reuters.

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

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Luxury as display of success in China - Tom Doctoroff

Tom Doctoroff

Luxury, as a display of success, is a key element in China, among all different cohorts, says marketing veteran Tom Doctoroff, author of What Chinese Want: Culture, Communism, and China's Modern Consumer to Emarketer. What they have in common is a Confucian culture, binding all Chinese together, he says. If explains the longing for luxury.

Emarketer:

Tom Doctoroff:

Luxury, no matter what demographic cohort in China you're talking about—whether it's young consumers who have limited out-of-pocket funds or the man on top of the mountain—is used as a demonstration of the ability to get ahead in the game of life or maintain one's place. And this is largely driven by Confucian culture. 

eMarketer:

Could you explain what Confucian culture is and how it's connected to luxury consumption in China?

Tom Doctoroff:

Confucian culture is a combination of rules and regimentation, and [the idea] that the individual does not exist independent of his obligations and responsibilities to others. Therefore, there is a need to obey certain standards; in this case, demonstration of success. 

But the other part of Confucian culture that people don't usually think of is that it's a meritocratic culture. Not by rebelling but by mastering the rules, you are able to climb up the hierarchy. Luxury goods and the type of positioning that luxury goods have reflect the aspirations of what people want to project about themselves in society. So luxury is not frivolous at all. 

If you look at the role luxury plays in American society, it is relatively minor compared with Chinese society. In the US, these types of expression [aren't required], no matter how subtly they are displayed. In America, people don't have the same rule [to demonstrate] a marker of success, due to the nature of its individualistic culture.

More at Emarketer.

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. 

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

The trouble of being a celebrity in China - Shaun Rein

Shaun Rein

The disappearance of famous movie star Fan Bingbing now three months ago has kept many guessing for the reasons behind it. Being a celebrity in China has some extra risks, explains business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order, for AP.  "There's a greater risk for celebrities to get in trouble with the law and never be able to get a chance at redemption."

AP:

Though China has become the world's second-largest film market, authorities keep tight control on local productions, exercising final say over choice of cast, director and script. If Fan had stepped on official toes, it would be a simple task to retaliate by destroying her career, with Chinese authorities wielding broad powers to detain, interrogate and accuse citizens out of the public eye. 

Other celebrities have run afoul of authorities over drug use, excessive pay or tax issues, said Shaun Rein, managing director of China Market Research Group based in Shanghai. 

"Then the government really cracks down hard and pretty much destroys their careers for several years if not forever," Rein said. Companies that bet big on a-list Chinese celebrities incur a "huge political risk," he said. 

Known as a classical Chinese beauty with almond eyes and porcelain skin, Fan, 36, usually maintains a prominent presence on Weibo, where she has more than 62 million followers. Her account has been largely dormant for weeks, however, with a July 26 "like" about a posting on her charitable foundation being the last activity prior to the deletion of her birthday notice. Photos on social media also appear to show her visiting a pediatric cardiac ward at a Shanghai hospital for a charity event on July 1. 

The strongest clue to Fan's status may have been a Sept. 6 notice posted on the website of the Securities Daily, a newspaper published by the official Economic Daily. It stated that the local tax bureau had sent a notice to Fan's studio that she had been "placed under control" — a legal term for being held under investigation. The article was later deleted from the website. 

Fan's disappearance has already taken a toll on her lucrative sideline as brand ambassador, throwing those companies' plans into disarray. Australian vitamin brand Swisse issued a statement saying it was suspending use of her image and "continuing to monitor the situation and hope that it is resolved in the near future." 

British diamond giant De Beers, who signed with Fang just last year, appears to have already moved on: Another actress, Gao Yuanyuan, represented the company at a store opening last month in the ancient capital of Xi'an. Other firms she endorsed, from duty-free chain King Power to Louis Vuitton and Montblanc are also taking action.  

"There's a lot more risk for celebrities in China than in the United States, because the government takes much more of a moral crackdown," said China Market Research's Rein. 

"So there's a greater risk for celebrities to get in trouble with the law and never be able to get a chance at redemption."

More in AP.

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What is next in the China-US trade war? - Arthur Kroeber

Arthur Kroeber

China is running out of steam in putting tariffs in US imports, but certainly not running out of options to fight the ongoing trade war, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know, to the South China Morning Post.

The South China Morning Post:

Arthur Kroeber, research head and co-founder of the financial services company Gavekal, said Chinese leaders’ previous tactics – including “a few buying missions” to Washington, a red-carpet welcome for Trump in Beijing and an attempt to cut a deal with Treasury Secretary Steven Mnuchin – had all failed. 

“China will respond with its own tariffs, start squeezing US companies where it can, and dig in for a war of attrition,” Kroeber said.

More in the South 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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Alibaba: well positioned to enter Russia - Ashley Dudarenok

Ashley Dudarenok

China internet giant Alibaba struck a major deal last week with Russia's  Mail.ru - one of Russia’s leading tech and media conglomerates that is already called Russia's Alibaba. A smart move says Russian Ashley Dudarenok, a veteran marketer on China's e-commerce and author of Unlocking the World's Largest E-market: A Guide To Selling on Chinese Social Media in the China Economic Review.

The China Economic Review:

Alibaba has invested more than $4 billion in Southeast Asian e-commerce group Lazada and other leading tech players in recent years. In June, the company posted that it had bought a stake in Turkey’s local leader Trendyol, while Amazon is still fumbling with the launch of a Turkish service. In India, Alibaba recently invested in digital payments platform Paytm, granting in exchange access to its cloud infrastructure. 

Alibaba’s experience building China’s e-commerce market effectively from scratch makes it uniquely suited to entering these markets, according to Ashley Dudarenok, a Chinese digital marketing consultant who is herself a Russian national. 

“They are aware that there is not much infrastructure in markets like India and Turkey, and they know exactly how to deal with this sort of aspirational consumer base,” says Dudarenok. “Along with countries in Southeast Asia, Russia is one such market.” 

It may be still be poor by Western standards, but Russia has the largest population in Europe and an emerging middle class that offers significant growth potential. As elsewhere, Alibaba is planting its seeds early, ready to reap the rewards when the consumer market matures.

More in the China Economic Review.

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

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Can the next generation take over Alibaba from Jack Ma? - Shaun Rein

Shaun Rein

Alibaba's chairman Jack Ma announced he will turn over the reins of his company to the next generation of executives next year. But business analyst Shaun Rein, author of The End of Cheap China, Revised and Updated: Economic and Cultural Trends That Will Disrupt the World, wonders if the new generation takes over Ma's magic spell over staff, users and investors, he tells to Inkstone News. 

Inkstone News:

Analysts say while Alibaba has some of the best executives in China’s tech world, it will be difficult for its next-generation leaders to fill Ma’s shoes.

“Ma is critically important to the company,” said China Market Research's Rein. “He is the strategic driver. He is the face of the company. He makes governments and businesses comfortable with working with it.”

“Daniel Zhang does not create the same warm and fuzzy feelings,” Rein said. “Consumers trust Jack Ma. It is part of their loyalty towards Alibaba.”

More at Inkstone News.

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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Trump wants US firms back from China - Arthur Kroeber

Arthur Kroeber

The focus has been on the Chinese government after US president Donald Trump announced new tariffs. But that might be wrong, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know to CNN. What Trump wants is not getting China into negotiations, but forcing US companies to come back to the US.

CNN:

Several previous rounds of talks between the two sides have failed to make progress. Analysts are skeptical China will be willing or able to do enough to satisfy the Trump administration on some of its key concerns, including Chinese efforts to get hold of US technology and Beijing's ambitious industrial policies. 

"The principal objective of the tariffs is probably not to bring Beijing to the bargaining table," Arthur Kroeber, a senior analyst at research firm Gavekal said in a note Tuesday. "Rather, it is to force US multinational companies to pull back their investments in China, so that the interdependence of the two rival economies is reduced." 

"Against this aim," he added, "no possible offer by China can cause the tariffs to be lifted."

More in CNN.

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.

Are you looking for more experts on the trade war between China and the US? Do check out this list. 

China's banking system: walking on a tightrope - Sara Hsu

Sara Hsu

China's financial authorities try to manage shadow banking, corporate leveraging and now also a heated trade war. Financial analyst Sara Hsu explains how the country's banks are walking a scary tightrope, at the EastAsiaForum.

Sara Hsu:

Because of the banking sector’s close ties to the government, financial stability can and will be tightly controlled. Banks will likely be forced to lend to entities that would otherwise not receive extensive funding, such as local governments. Funds will be granted where the government desires at the expense of some of the riskier loans. We saw this happen time and again in the wake of the global financial crisis, as local governments followed orders to build infrastructure by creating bridges to nowhere and ghost cities. 

This time around, waste may be less blatant but is unlikely to be eliminated. In the end, the central government will probably step in once again to convert the non-performing loans to municipal bonds or sweep them off banks’ balance sheets to asset management companies. 

The trade war has exacerbated China’s dilemma of stimulating the economy to avoid slowing growth and tightening the economy to reduce financial risks. Although stability is likely to be maintained, the government walks an increasingly fine line to do so. If tensions worsen between the United States and China, it is possible that China may be forced to choose stability over growth — a choice that would shake the global economy by stunting global demand.

More at the EastAsiaForum.

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

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

How #MeToo brought down China's supermonk - Ian Johnson

Ian Johnson

The Venerable Xuecheng did become the symbol for supercharged Buddhism in China. Journalist Ian Johnson, author of The Souls of China: The Return of Religion After Mao, looks for the New York Times at how China's #metoo movement brought down this confusing factor in the rising Buddhism.

Ian Johnson:

Over the past two decades, religion in China has boomed, and no faith has benefited more than Buddhism. The number of temples has tripled, monks and abbots have become well-known public figures, and China has used the faith to build ties around the world, sending out nuns and monks on goodwill missions. 

The person most closely associated with this revival is the Venerable Xuecheng, a charismatic monk who was fast-tracked for success. He became abbot of his first temple at 23 and head of the Communist Party-run Buddhist Association of China at 49. 

His use of social media and emphasis on compassion attracted the sort of bright, white-collar professionals who once spurned traditional Chinese religions. Many rank him as the most important Chinese Buddhist reformer in a century. 

But over the summer, all of these worldly successes vanished. 

Accused of lewdness toward nuns and financial misconduct, Xuecheng, 52, has in recent weeks been stripped of his titles and banished to a small temple in his home province of Fujian. Government investigators now occupy the cleric’s main temple in Beijing, have purged his cadre of loyal monks and are scouring his books for financial wrongdoing. 

That makes Xuecheng the most important national leader to be felled in China’s small but tenacious #MeToo movement, a rare case of a politically connected figure here falling to charges of sexual misconduct. 

It has also prompted widespread discussion among Buddhists about whether their faith’s rapid growth has come at too steep a cost. 

Many worry that Xuecheng’s model of a supercharged Buddhism that embraces social trends lacks the very spirituality that drew people to the faith in the first place. His downfall also presents a potential setback in the Chinese government’s efforts to push Buddhism as a kind of national religion that can win friends abroad and offer moral values at home. 

“It’s impossible not to feel pained and sorrowful” at recent developments, two monks wrote in a 95-page report detailing accusations of sexual and financial misdeeds against Xuecheng. They asked the government to act quickly, or “we dare not imagine where Xuecheng will lead this group of Buddhists!”

More 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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What if gambling takes off on Hainan? - Sara Hsu

Sara Hsu

The debate is taking off on whether China would allow gambling on Hainan Island. Financial analyst Sara Hsu explains gambling would diversify the tourism industry on the island, but would also hurt the economy in nearby Macau. Two earlier efforts on Hainan were already aborted for political reasons.

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

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China consumers have become more sophisticated in dealing with brands - Tom Doctoroff

Tom Doctoroff

Consumers in China have become more sophisticated over the years in the way they handle brands, says China veteran Tom Doctoroff, Chief Cultural Office or Prophet and author of the bestseller What Chinese Want: Culture, Communism, and China's Modern Consumer, at the occasion of the 2018 Prophet China Brand Relevance Index(TM) at the Market Business Inside.

The Market Business Insider:

According to the 2018 China Brand Relevance Index™ (BRI) survey conducted by Prophet, a global brand and marketing consultancy, Chinese consumers have become more strategic in their purchase. They increasingly value meaningful and tangible innovations of home-grown Chinese brands and appreciate enriched experience through content. 

Tom Doctoroff, Chief Cultural Officer at Prophet said: "Chinese consumers are becoming increasingly sophisticated, actively seeking products and services that provide substance, innovative experience and belongingness. Over the years, we have seen a growing number of brands – both domestic and international – striving to tap into the local market and this trend will be here to stay. To win the hearts of Chinese consumers, brands should be built upon in-depth consumer insights that help boost their relevance to Chinese consumers."

More at the Market Business Insider.

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Why US firms cannot just leave China - Arthur Kroeber

Arthur Kroeber

The argument of the Trump administration is simple: if you want to avoid tariffs, leave China and come back to the US. That is too simple, says economist Arthur Kroeber, author of China's Economy: What Everyone Needs to Know, at the Asia Times.

Asia Times:

There are myriad other case studies that bely US Trade Representative Robert Lighthizer’s oft-stated advisory: if you want to avoid our import penalties, make things at home. To amplify the point, regulators increased scrutiny of Chinese companies investing in America and US ones selling technology to the mainland. This choose-us-or-them policy has many problems. 

One, Kroeber says, is that US companies have more than $250 billion of direct investments in China, ginning up nearly $500 billion in mainland sales each year. 

“For many companies, China is their biggest and fastest-growing market. In a growing number of sectors, it is simply not a viable business strategy to shun the China market.” If an American multinational isn’t there, it will lose market share and profits, running afoul of shareholders. Extrapolate this dynamic a bit further, and the rising stock market Trump touts on a daily basis might not be so vibrant.

More at the Asia Times.

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.

Are you looking for more experts on the ongoing trade war between China and the US? Do check out this list.

Investors have a too-short view on Tencent - Matthew Brennan

Matthew Brennan

Tencent's shares moved like a roller coaster, but that reflects more the short-term sentiments of investors than changes in the company's prospects, says Tencent watcher Matthew Brennan to Global Times.

Global Times:

Tencent's shares were among the world's best performers in 2017, when a 13-month winning streak led the stock to more than double from HK$179.7 in December 2016 to HK$471.2 in January 2018. 

This year, however, the shares have tumbled about 35 percent, falling to $HK308.4 on Wednesday. Tencent shares are down 15.6 percent in the past two weeks alone in response to tightening regulation of China's videogame market. 

"Investors are being too short-termist," Matthew Brennan, founder of Tencent-focused tech consultancy China Channel, told the Global Times on Wednesday. 

"Tencent's stock rose incredibly in 2017, then dropped rapidly in 2018, but its long-term strategy hasn't changed that much. Tencent is focusing in mini-programs, and all major internet companies in China are following that lead," said Brennan.

More in Global Times.

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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Religion: back in China's center of politics and society - Ian Johnson

Ian Johnson

Most Western media reports focus on the oppression of religion in China, and miss one of the most important developments in the country when it comes to religion, argues journalist Ian Johnson, author of The Souls of China: The Return of Religion After Mao in the China Zentrum. "Faith and values are returning to the center of a national discussion over how to organize Chinese life."

Ian Johnson:

[F]ocusing on oppression can blind us to a greater truth: that China is in the midst of an unprecedented religious revival, involving hundreds of millions of people – best estimates put the figure at 300 million: 10 million Catholics, 20 million Muslims, 60 million Protestants, and 200 million followers of Buddhism or traditional religions in China. 

This doesn’t include the tens or even hundreds of millions of people who practice physical cultivation like Qigong or other forms of meditative-like practices. 

The precise figures are often debated, but even a casual visitor to China cannot miss the signs: new churches dotting the countryside, temples being rebuilt or massively expanded, and new government policies that encourage traditional values. Progress is not linear – churches are demolished, temples run for tourism, and debates about morality manipulated for political gain – but the overall direction is clear. Faith and values are returning to the center of a national discussion over how to organize Chinese life. 

What drives this growth? I would argue that hundreds of millions of Chinese are consumed with doubt about their society and turning to religion and faith for answers that they do not find in the radically secular world constructed around them. They wonder what more there is to life than materialism and what makes a good life. As one Protestant pastor (female) told me, “We thought we were unhappy because we were poor. But now a lot of us aren’t poor anymore, and yet we’re still unhappy. We realize there’s something missing and that’s a spiritual life... 

If we take all this together, the most important conclusion is that religion, far from being an issue of fringe or esoteric interest, is back in the center of Chinese politics. This is the result of hundreds of millions of worshippers pushing for a place in society. And now, because they have not died out but instead proven to be an irreplaceable part of modern-day, the Communist Party has decided to try to coopt some of this new social force, creating opportunities but also growing tensions. 

For millennia, religion was the ballast that kept the Chinese state stable. For over a century, the state cast it overboard and Chinese society heaved to and fro, swinging from dictator-worship to unbridled capitalism. Now, religion is back but the question is if it will be a stabilizing force in society, or unmoored by counterproductive government policies, a loose cannon that crashes through the decks.

Much more background from Ian Johnson in the China Zentrum.

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How Jack Ma changed China - William Bao Bean

William Bao Bean

Traditionally China's youngsters wanted a job with the government, but Alibaba's Jack Ma changed that perspective and starting a startup became the choice of many, says William Bao Bean, a Shanghai-based partner at venture capital firm SOS, one of the largest VC's, to Bloomberg. How Jack Ma changed China.

Bloomberg:

“The China startup scene wouldn’t exist in the same way without Jack Ma,” said William Bao Bean, a Shanghai-based partner at venture capital firm SOSV. “The celebrity of Jack Ma and the success of Alibaba made startups an acceptable career choice, which has fueled one of the biggest technology markets in the world." 

Ma wasn’t just successful. He broke the mold for China’s business leaders, typically faceless chiefs running mammoth state-owned enterprises like PetroChina and China Mobile. He dressed up like Michael Jackson and tried the moon walk. He wore a three-foot feather Mohawk and makeup to perform at a company party. And he dispensed Yoda-like axioms that were collected in dozens of management books. 

"To many he’s the face of China’s internet -- no one really knows what Pony Ma looks like," said Bean, referring to the CEO of Tencent Holdings Ltd.

More at Bloomberg.

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.

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How Jack Ma smartly plans his succession - Shaun Rein

Shaun Rein

Alibaba's chairman Jack Ma has unveiled his eagerly awaited succession plan, including a transfer of power to the current CEO Daniel Zhang. A very smart move, says business analyst Shaun Rein, author of The War for China's Wallet: Profiting from the New World Order to the Nikkei Asian Review.

Nikkei Asia Review.

Shaun Rein, managing director at China Market Research Group in Shanghai, said the announcement shows that Ma "is empowering Zhang and giving an orderly transition." Rein called the move "very smart" because it "reduces uncertainty over who is in charge to make decisions" at the company. 

"Ma won't loom over Zhang for years," he said. 

"This is the way to inform business partners and government officials that Daniel Zhang and other leaders are the right people to talk to because, right now, everybody wants to talk to Jack Ma," Rein said. 

"By doing this, he is empowering his successors, which is important because Alibaba has a really strong team and it's time for them to take on more power as Alibaba has moved into other countries, like India, and moved into new divisions, like cloud computing and finance," Rein said. In his letter, Ma said he wants to return to education, "which excites me with so much blessing because this is what I love to do." Ma graduated from Hangzhou Normal University in 1988 and continued to teach English there for several years.

More in the Nikkei Asia Review.

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.

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