North Korea´s gentle power shift - Paul French

+Paul French 

The disappearance of North Korea´s leader Kim Jong-un from public view, might not be as dramatic as some commentators have suggested, writes author Paul French of North Korea: State of Paranoia: A Modern History in a Reuters´blog. It might as well be a gentle power shift from one-man rule to the country´s elite, based on consensus.

Paul French:

Kim Jong-un has apparently gone AWOL. His movements unknown, the reason for his sudden invisibility mysterious. Nobody in Pyongyang is saying anything. But then nobody in Pyongyang ever says very much. Still, Kim has been hard to find since early September and the North Korean media have not posted any pictures of him inspecting a jam factory or shouting into a field telephone at some remote artillery post. “Kim watching” is bread and butter to the smallish coterie of Pyongyang Watchers and radio silence inevitably gets ratcheted up to suspicions of ill health, death, murder or coup. 

In the world of North Korea analysis there’s no light comedy or gentle drama – it’s always straight toMacbeth! But hold on a minute before we put the U.S. Seventh Fleet on red alert or open up the bomb shelters in Seoul. We’ve been here before… 

Rumors of attempted military coups among the shadowy Pyongyang elite have emerged regularly over the years. The 1950s and 1960s saw show trials of senior military personnel, when Kim Il-sung purged political rivals after sequestering himself and leaving analysts wondering where he’d got to. In the late 1960s Chinese Red Guards claimed that Kim Il-sung had been arrested by army generals after he wasn’t seen for a bit. A further purge of the military hierarchy reportedly followed, so maybe the Red Guards knew more than most... 

What we may be witnessing here is something far less dramatic than a coup, but no less important in many respects –- a shift from the traditional policy of the all-powerful, all-guiding  “Suryong Dominant Party-State System,” whereby the supreme leader directly rules over the party, the government, and the military, to something more consensual among the elite. Kim Jong-un may now be accepting advice and delegating roles to a greater extent. His domestic position will remain dominant, a figurehead to the North Korean people, but internationally, and particularly in relations with South Korea he may be purposely taking a back seat to allow a breakthrough.

More in the Reuters´blog.

Paul French 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.

Paul French is a prolific author and speaker on China and North Korea. For a regularly updated list of his activities, click here. 

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Is price-fixing really an issue? - Paul French

+Paul French 

A larger number of foreign companies have been accused of price-fixing. For all the wrong reasons, and based on little proof, argues author Paul French in Ethical Corporation. They include "Unilever, Qualcomm, Mercedes-Benz, Audi, Chrysler, Microsoft, BMW, Nike, a whole bunch of Japanese car parts manufacturers and quite a few other corporations".

Paul French:

Right now it seems allegations of price-fixing are being used to punish anyone raising prices and the courts feel little need to prove the essential collusion between manufacturers, distributors and retailers that is the legal essence of price-fixing. Car, pharmaceutical and tech companies seem to be most in the spotlight, all areas where Beijing would like to see more customer support for local firms. 

Ultimately this could all rebound on Beijing. Does anybody really believe that all these foreign companies are colluding to fix prices in China in a host of secret meetings and cabals? Certainly proof is decidedly thin on the ground. And if foreign car brands drop their prices then surely this will only increase the price pressure on rival, local brands? 

Additionally, many foreign manufacturers, usually citing wage rises, have been moving production to other locations. Feeling especially put upon by the Chinese authorities may speed up this process. Certainly foreign direct investment in China is down (in July it was at its lowest for several years) but how much this is due to relocation of manufacturing, diversification of sourcing or the crackdown is unclear. 

China may want to remain cheap, Beijing may want local companies (which, of course, are also faced with rising costs) to dominate, but staving off the inevitable by punishing companies with massive fines may just accelerate the process of relocation and job loss. It seems a rather bodged response to a long-term problem.

More in Ethical Corporation.

Paul French 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 interested in more experts on risk management at the China Speakers Bureau. Do check out this recently updated list. 

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Debunking myths about North Korea - Paul French

+Paul French 

Getting a grip on North Korea is hard for the outside world. Paul French, author of North Korea: State of Paranoia: A Modern History tries to debunk some common misunderstandings in an interview with VOA.

VOA:

FRENCH:  Well, I think the biggest myth, or at least the most dangerous myth that I wanted to deal with in my book, as someone who has sort of visited North Korea on a number of occasions - which is not necessarily an easy thing to do, particularly for Americans of course – is to try and show the ordinary North Korean people and the daily life that they have as difficult and highly politicized and highly regimented and with a lot of surveillance, but that they are essentially normal people. I think that a lot of the North Korean government, we almost see like this robotic nation, the few images we get are always of military parades or something like that, but these are people who get up in the morning and kiss their kids goodbye and go off to work, and the kids go off to school, and so on.

STEVENSON:  North Korea is opening up a little bit in terms of tourism, in terms of hard currency. What do tourists see as normal when they visit Pyongyang and other locations within North Korea?

FRENCH:  It is a little bit like going to Disneyland in a sense, in that, you see exactly what the corporation that runs North Korea wants you to see and nothing else. And anyone that tries to sort of look behind the stage set, or actually talk to the ordinary people if you like, someone will try and stop you from doing that. So they very much want to handle you, they want to guide you around; they don’t want you to have ordinary conversations with people. So in that sense, there is an odd sort of feeling that you’re in one big sort of theme park when you’re there.

STEVENSON:  What prevents the regime in North Korea from reforming while retaining power when it can clearly look over next door at China and see a 35 year blueprint for progress?

FRENCH:  Well, this is becoming more and more of an issue, I think, now as more and more North Koreans, not just the elite, start to see just how wide the disparity has become between North and South Korea. This is way beyond anything we ever saw in – the example that’s always used, East and West Germany – the disparity of course being between Seoul and Pyongyang is almost unimaginable, they’re essentially now two completely different nations.

But again, their response to it has not been to emulate what has gone on in the South, or even to emulate what has gone on in China, which is a good example for them – a lot of market reforms, a lot of more money moving around the system, but [with] the authoritarian party staying in place, [or] regime survival, that they don’t seem to be able to do that. Their response has been to try and lock down and stop people knowing what’s going on outside.

More in the VOA.

Paul French 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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Risk management experts at the China Speakers Bureau

Foreign companies fear an increasing risk in China, now the government is tightening legal supervision, fighting corruption and banning business practices that were considered to be common up to a year ago.  GSK might be one of the high-profile cases in the anti-corruption drive, but no foreign company or industry is not worried about those changes. The China Speakers Bureau can offer a range of experts on risk management in China.

Are you interested to retain one of these speakers at the China Speakers Bureau for your event? Drop us a line.  

+Benjamin Cavender 

Ben Cavender is a senior analyst with The China Market Research Group (CMR) focusing on strategic planning and brand positioning.

Recent Project Experience:
Fortune 100 Chemical Company-5-Year Growth Strategy: Over a 6 month engagement focused on understanding emerging market trends, evaluating competitors’ positions in the market, analyzing value chain inefficiencies, and uncovering potential growth markets in order to develop a 5 year growth strategy for the China market

Billion Dollar Private Equity Fund-Investment Strategy: Conducted due diligence into $100 million USD investment including assessment of management capabilities, potential of brand and products for long term growth, strength of retail network, and evaluation of competitor threats to develop an investment recommendation and strategy.

You can read about Ben Cavender´s recent activities here.

+Marc van der Chijs 

Marc van der Chijs, Founder Tudou, Partner at the venture capital firm CrossPacific Capital.

Marc van der Chijs is one of the high-profile foreign entrepreneurs who discovered how to be successful in China. After a short stint at Daimler-Benz in China, he decided to continue by himself and teamed up with people who now belong to the internet jetset of China.

He worked in a wide variation of industries: games, e-commerce, online fashion sales, but established his reputation as co-founder of Tudou, at the time the second-largest  video hosting company in China, larger than YouTube. Running media-related ventures in China is extremely risk prone, and Marc has become an expert in managing risk in difficult industries.

He is currently involved with a range of China projects, board member of the disruptive financial startup Sinolending, and the development of Bitcoin.

You can read about Marc van der Chijs´recent activities here.
 

+Paul French 

 Paul French, author and Chief China Market Strategist at Mintel.

A prolific author of books on China and North Korea, including subjects like obesity, foreign correspondents and even a best-selling historical novel about a murder in Beijing. With a typical British touch, Paul knows how to challenge any audience.

He earned his business stripes as a retail analyst in China, and a much wanted speaker on China´s fast changing business climate. With villain British humor he analyzes the capital mistakes by both foreign and Chinese companies in trying to do business.

As a China specialist he has been quoted in a wide variety of publications including the FT, Newsweek, the Wall Street Journal Asia, the South China Morning Post and the LA Times.

You can read about Paul French´s recent activities here.

+Paul Gillis 

Paul Gillis is professor of practice and co-director of the IMBA program at the Guanghua School of Management at Peking University, CPA.

Paul Gillis is a renowned and outspoken analysts of accounting practices of foreign firms in China.

As a retired partner at PWC (1976-2004) he teaches accounting, auditing and finance at the Guanghua School of Management at Peking university since 2007.

He has lectured at the Communist Party School and regularly speaks to investor and corporate groups. He published in 2014 his book The Big Four and the Development of the Accounting Profession in China (Studies in the Development of Accounting Thought, based on his PhD.

You can read about Paul Gillis´ recent comments here.

+Shaun Rein 

Shaun Rein, managing director of the China Market Research Group (CMR)

Shaun Rein is one of the world’s recognized thought leaders on strategy consulting in China. His book ´The End of Cheap China. Economic and Cultural Trends that Will Disrupt the World´, published in 2012, solidified his reputation of challenging established classic ways to frame China.

He is a regular commentator on Bloomberg TV, The Wall Street Journal and other mainstream media.

At the end of  2014 he will publish his new book´The End of Copycat China.  The Rise of Creativity, Innovation, and Individualism in Asia´. In that book he will explain how China from a copy-and-past culture is now developing into one of the world´s leading innovators.

You can read about Shaun Rein´s recent activities here.

+Mark Schaub 

Mark Schaub, Partner at King&Wood and Mallesons, the largest law firm in China and Australia combined.

Mark Schaub is a prolific speaker who wastes no time in avoiding the real challenges in doing business in China.

As a lawyer he had extensive experience in negotiating deals, firing people and otherwise dealing with the ignorance of companies entering the Chinese business minefield. Mark Schaub has 15 years of legal experience in China and was the first foreign lawyer to enter a Chinese law firm.

You can read about Mark Schaub´s recent activities here.

Are you interested in other subjects concerning China? At our bureau announcement page you can find more lists of our speakers on different subjects. Or you can ask us for a tailor-made proposal for your event.

You can also order this upcoming publication on managing your China risk by Jeremy Gordon:

• Raising US$500m in two minutes, the Dianrong story - Marc van der Chijs
• Pros and cons of Chinese companies going west - Joel Backaler
• Risks and challenges of the Alibaba IPO - Ben Cavender
• China might ban Hong Kong audits - Paul Gillis
• Why I decided to leave Shanghai - Marc van der Chijs
• Why China´s corporate debt is riskier - Sara Hsu

Ethics firmly on the China agenda - Paul French

+Paul French 

For those who have missed it: corruption is high on China´s hitlist for the past year, just ask executives at pharmaceutical companies. Author Paul French argues in Ethical Corporation the crackdown on foreign firms could have been expected, and will last.

Paul French:

It used to be argued by bullish chief executives of multinationals operating in China that you didn’t need to worry too much about ethics in the “Wild East”. Ethics were alien to Chinese business culture: the government would tolerate anything that brought in investment and created jobs, and HQ back home would turn a blind eye if you kept the cash rolling in.

It was a popular trope with those who believed themselves omnipotent and untouchable in China, arguing vociferously that weak rule of law, fungible regulations, pliant officials and unrepresented workers was a much better recipe for commercial success than all those pesky regulatory compliance officers and ethical guidelines.

Perhaps it would be good to ask Mark Reilly, former China chief of pharma giant GSK, what he now thinks about ethics, regulation and long-term profits? As we commented in 2013, the scandals at GSK in China were a mixture of “grey” areas, loose regulation and legal weaknesses. Now, more than six months later, Reilly and two local GSK executives, Zhang Guowei and Zhao Hongyan, have been charged with corruption – accused by China’s Public Security Bureau (PSB) of bribing doctors to prescribe GSK pharmaceuticals.

The charges could lead to life sentences for the accused. GSK says it is cooperating with the PSB. Foreign business in China has declared itself shocked – the American Chamber of Commerce in Shanghai says it is “surprised at the strong response”.

But should they be surprised? And should they not all look at their own practices?

More in Ethical Corporation.

Paul French 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.

Paul French has, like many of the speakers at the China Speakers Bureau, written books on China. When you retain our authors as a speaker, we might be able to help you in brokering a deal getting their books for a heavily discounted price. 

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How contraband is changing North Korea - Paul French

+Paul French 

Paul French, author of North Korea: State of Paranoia: A Modern History explains in the Deutsche Welle, North Korea is slowly changing, against the will of its ruling elite. Its citizens know more than ever what is happening in China and South Korea.

Paul French:

It has changed over time. When I first went, there was a bit of [being treated like an] alien. But over time, things have changed. There is now an awful lot of contraband and pirated information, particularly from South Korea, and from China as well: soap operas, films on DVD. I've also seen a lot of memory sticks coming into the country that have whole editions of television series, magazines and books downloaded on them. So, compared to a decade ago, most North Koreans have much more of an idea of what life looks like in South Korea as well as in China. Of course that has political implications, because now they are aware of the fact that things are perhaps not quite as good as their leaders told them they were.

Could this also be the beginning of the end of this system, if citizens are getting a glimpse of what is actually happening outside of North Korea?

That certainly seems to be a fear that many people have. A document was recently leaked showing that both the Chinese and the South Koreans are at the moment ramping up preparations for what they perceive could be a very sudden change, which is mostly thought of as a political coup followed by a period of complete economic collapse, which will cause all sorts of problems.

Kim Jong-un, who is rather young and not that experienced, has taken over from his father, Kim Jong-il. Despite some pretty heavy purging, including his uncle, and trying to put his stamp of authority on the government in the way that his father and his grandfather - the first leader of North Korea, Kim Il-sung - did, it hasn't really worked. He hasn't managed to consolidate power. There have always been tensions between the Kim family and the military, and it seems that both Beijing and Seoul, who know the place best, are worried that there could be some sort of catastrophic incident, a coup or something, that could plunge the place into chaos.

More in the Deutsche Welle.

Paul French 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 a media representative and you want to talk to one of our speakers? Do drop us a line.

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North Korea: nobody´s puppet - Paul French

+Paul French 

The Guardian reviews author Paul French´ extensively researched book North Korea: State of Paranoia: A Modern History. French deals with many subjects, including the country´s relationship with China.

The Guardian:

French points out that North Korea's leadership is nobody's puppet. During the Sino-Soviet split following Stalin's death, Kim Il-sung, the country's long-serving leader, first tried to keep in with both sides but then broke both with Khrushchev's revisionism and Mao's Cultural Revolution. Mao's Little Red Bookwas blocked from circulation.

Forty years later, China still protects North Korea diplomatically from outside pressure, but there is no ideological affinity between Pyongyang's command economy and China's increasingly capitalist one. Russian relations with Pyongyang cooled severely when Soviet communism collapsed and Boris Yeltsin cut cheap fuel supplies and other subsidies, dealing a sudden and massive blow to the North Korean economy.French provides a comprehensive account of the controversies surrounding North Korea's nuclear programme. A period of genuine promise emerged in 1994 when the US and North Korea reached an Agreed Framework thanks to the diplomacy of former President Jimmy Carter whom Bill Clinton had appointed as a special envoy. Kim Il-sung was to halt his nuclear programme in return for US support in providing "proliferation-resistant" light-water reactors to develop the country's civilian energy production. It was a good compromise but South Korea and Japan were to shoulder most of the cost and these two countries started to raise objections. When George W Bush came to power and cited North Korea in his "axis of evil" speech in 2002, the deal fizzled. In spite of sporadic negotiations between Pyongyang and Washington to find a new agreement, with China, Japan, Russia and South Korea also involved at the table, there has been no breakthrough for the last dozen years. None is expected.

Much more in the Guardian.

 Paul French 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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