Europe China Research and Advice Network
Christopher Henson is the Branch Representative for Sussex and Kent and membership secretary. He is a regular contributor to China Eye. What does the People's Republic of China's 12th five Year Plan mean for us in the West, and specifically for us in Britain? During the week of October 17th, SACU members Dr. Kerry Brown, Head of the Asia Programme at Chatham House and Team Leader of the Europe China Research and Advice Network (ECRAN), and Joan Turley, author and consultant, addressed different aspects of this question at conferences in Brussels and London. Reprinted from SACU's China Eye magazine (2011).
ECRAN maintains a very informative web site at euecran.eu ➚. This is a three year project funded by the EU to provide research papers and advice on social, political, environmental and economic trends in China to European policy makers. Franz Jessen, former head of the China Section at the European External Action Service (EEAS) of the European Council and Hongjian Wang, Minster at the Chinese Delegation to the European Union in Brussels, each outlined in his Opening Remarks some of what they anticipate ECRAN will deliver.
Mr. Jessen noted that the EU-China relationship is one that is critically important to the European Community and is likely to become even more so in the near future. The European economy simply cannot afford the consequences of miscalculations made from ignorance - such as the total failure to predict the size and vigour of the new-car market in China in recent years. Jessen also noted that this is a relationship that proceeds at a very different level than the one at which the EU normally engages with other states.
For his part, Mr. Wang made three points that he thought were both present and needed in the EU-China collaborative exercise that ECRAN represents; political courage, innovative thinking and patience and wisdom. Europe demonstrated political courage in establishing diplomatic ties with the PRC at the height of the Cold War and China respects this. We will also need innovative thinking to construct ways ahead and patience and wisdom to overcome trade frictions. The two remaining opening speakers both spoke directly to these points in their comments.
The former Advocate General for Scotland, Lord Neil Davidson, gave the Keynote speech on "The current role of China and engagement with the EU" and made two provocative and thoughtful points. Why, he wondered, if we are serious about engaging with China does the EU not offer full market economy status to China? There is no single model for determining eligibility; all are unique and culturally-dependent. If Russia qualifies for full market economy status, he asked, then why does not China? Is this in fact a screen for the employment of "anti-dumping" measures which are then made without reference to China's comparative advantage of low labour and production costs? Secondly, he noted that the EU continues to enforce an arms embargo dating from 1989. This embargo also precludes the supply of super-computer technology to China from EU firms but China now has the world's fastest super-computer anyway. In many other ways, the China of 2011 and the China of 1989 are two very different places, a difference emphasized by the plane-loads of Chinese tourists that now descend on European capitals daily. What, he wondered, is the embargo intended to achieve?
The final opening speaker of the conference was Gudrun Wacker, the Senior Asia Research Fellow for Stiftung Wissenschaft und Politik in Berlin. Ms. Wacker's topic was "Contextualising the EU-China relationship" and she resumed from where Neil Davidson had concluded. Advocates of improved relations between the EU and China must contend, she said, with an incomplete public understanding of China fuelled by what frequently seems to be unfair treatment in the European press. Further, our own understanding of what will be necessary to move ECRAN's mission forward may need periodic redefinition. Europeans sometimes mistake dialogue for cooperation but dialogue is actually the precondition for cooperation. ECRAN is designed to facilitate cooperation, not just dialogue, and will avoid issues, such as trade imbalances that are more appropriately dealt with in other forums.
The balance of the conference was then divided about equally into four sections dealing with China's Society, its Economics, and the country's political and natural Environments. This is where familiarity with ECRAN's web site will be most useful to SACU members with an interest in any of the research papers presented to illustrate each area. For example, the Research section of the website (http://www.euecran.eu/resources) has now, or will shortly have, the paper presented by Professors Robert Ash, Robin Porter, and Timothy Summers on "China's 12th Five-Year Programme and its expected economic impact on the EU". The authors found continuity between the 11th and 12th Plans and termed it a serious attempt to find a strategic goal for China. It will rebalance the economy from one that has been driven by export-led growth for thirty years to one that will develop the power of a vast domestic market. It maintains the trend evident in the 11th to be open and collaborative as opposed to administrative.
The Plan aims to begin correcting the income inequality problem between the rural and urban segments of Chinese society. The authors predict that we will see big shifts in economic patterns in the PRC and recommend that the EU give consideration to representatives across China rather than on just the east coast over the next five years.
One of the drivers behind the environmental goals of the Plan has been the leadership's realization that based on projected water availability China will produce 8% less food by 2030 than was produced in 2003-04. Maize (corn) production is down and Chapter 4 of the Plan is concerned solely with agriculture and food security. Food security was also one of the main topics at the China-EC Agriculture conference in Chonqing two years ago. Coincidentally, the massive investment China is making in water desalinization facilities was a lead topic in the New York Times business section today (October 20th).
Also in the Economics section is a paper by Jeremy Clegg and Hinrich Voss of Leeds University on "Chinese Inward Investment into the EU and Greater Europe". In the Society section of the conference, a paper titled "What we know about Chinese migration into the EU and what it means for economies, trends and drivers?", by Kevin Latham of SOAS and Bin Wu of Nottingham University, was especially informative. In Politics, "Foreign investors and the rule of law" by Marco Marazzi, Partner in the Shanghai office of Baker & McKenzie, provided the most current summary of the topic available. And in Environment, the section chaired by Isabel Hilton of China Dialogue (see http://www.chinadialogue.net/) some fascinating commentary by Ling Ge of Oxford University on "Green Technology".
From Brussels to King's College (KCL), London is only about a 3 hour train ride and it was at KCL on October 19th that Zoe Reed, SACU's chair, had arranged for SACU member Joan Turley, author of "Connecting With China" to present her thoughts for successfully doing business with Chinese companies. Her philosophy substitutes long-term relationship building strategies for short -term focus on profit as the key building block of mutually beneficial and collaborative business relations. This concept of "win-win" is frequently mentioned in China's leadership speeches too as a basis for improved relations between nation states.
Joan spoke to approximately 50 staff and international marketing students for about an hour and then fielded questions for another 30 minutes. One questioner asked what areas of economic opportunity she thought might develop from the current Five-Year Plan that would play to the strengths of British SMEs (small and medium enterprises)?
She referred to the problem that China has in representing its 'soft power' in the West. That is, despite achievements such as the Beijing Olympics, or some of the world's most innovative architecture, or even having brought hundreds of millions of its people out of absolute poverty, China still tends to be represented in Western media with often bizarre and non-representative stories like HGV drivers crushing infants.
China has a problem communicating the attractiveness of its traditional culture to Western audiences. Britain, on the other hand, has an advertising and creative arts industry that specializes in translating such messages. This surely is an area of "win-win" collaboration for companies in both countries in the immediate future.
Joan Turley is a consultant on China and has produced a new book, 'Connecting with China' ➚ published by John Wiley (£19.99). The book was written after discussions with 15 chief executive officers of 15 major Chinese companies. For success in China she emphasizes the importance of respect, mutual benefit and commitment to building relationships with Chinese business people.
© Copyright Society for Anglo-Chinese Understanding (SACU) 2011, reprinted from SACU's China Eye magazine Issue 32, 2011
The views expressed in this article are those of the author and do not necessarily represent the view of SACU.
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