Entering the Chinese Market

Before entering the seemingly lucrative Chinese market, investors should be aware of the darkside of the current business environment. The risk of rampant corruption, economic, social and political problems, and threat to personal safety go along with the potential benefits of a thriving economy, rapid growth and swelling consumer demand. Dixon and Newman describe the Chinese business environment and its major players—the People's Liberation Army, the 'princelings'—and 'guanxi' (connections). In addition, they describe the plight of foreign business people who have recently found themselves in ugly personal situations because of China's lack of internationally accepted business practices and ethics, lack of institutionalized rule of law, and lack of an impartial law enforcement system. They conclude that any prospective business rewards must be discounted by the personal and personnel risks foreign businesses face when dealing with China.

JOHN DIXON is a Senior Lecturer in the Department of Social Policy and Social Work at the University of Plymouth. He is a Senior Research Professor at the Shanghai branch of the International Technology and Economy Institute of the State Council of the People's Republic of China. He is the author of two previous books on China and has served as a consultant to Chinese state enterprises and ministries.

DAVID NEWMAN presently teaches at Nahoral University of Singapore. He was formerly an Associate Professor in the Faculty of Social Sciences at Lingnan College, Hong Kong. He is the author of two previous books on the future of Hong Kong and has served as a consultant to many international firms.