Working with government-owned entities
Companies throughout Asia, and in particular in communist China, are either owned by government or closely controlled.
The recent issues faced by the Chinese telecommunications company, Huawei, which was classified by several countries including Australia as a national security risk, illustrate the issue.
Australia refused Huawei the opportunity to tender for national broadband contracts, but when companies are in China, and other Asian countries, they must deal with government-owned entities.
“They are a fascinating example of Asian business and what is happening,” says Beasley. “They started out in Africa, in a market where no one else would go, a low-price, high-volume market and came from what Westerners thought was nowhere. Nokia didn’t know what hit them. If you go through their showcase in Shanghai, the scale of their operations and their ambition is amazing.”
But the reality of doing business in Asia is that the government is involved. “The Chinese government is still the Communist party,” says Beasley. “The reality of the fact that the party is involved is a very different business model. You can get very burnt. I am not Pollyanna about doing business in Asia. It can be brutal and a tough environment. As China expert, Clinton Dines, says, it is like a rollercoaster ride. Be ready for the rough and tumble. It is at a different level to what happens in Australia. You need to know what you need to know.”
One point to remember
Amid the excitement of the Asian Century, a lone voice last week was visiting Australia to remind leading companies of the investment opportunities in London.
Gordon Innes, the CEO of London & Partners, which is the official, not-for-profit promotional agency for London, wanted to remind Australian companies “there are still opportunities in the old world”.
Innes wants to dispute the view that the United Kingdom, London in particular, is in the doldrums. He says that the economy in London itself has grown between .5% and 1% since 2009, and in the third quarter, the UK’s growth was 1%, up from -.3% in the second quarter.
Innes is charged with trying to take advantage of international showcase provided the London Olympics to herd opportunities back to the home country.
Innes says London & Partners helps companies with business introductions, partnerships, setting up headquarters, finding staff and executives, business networking and introductions to government ministers.
Innes wants to attract institutional investors into the city’s 30-year plans for infrastructure projects.
