3 ms·

Can anyone chime in and help the rest of us understand the relationship between business and government in China? I can't help but think this is more of a move

by Glide 12y ago

Can anyone chime in and help the rest of us understand the relationship between business and government in China? I can't help but think this is more of a move to help China's internal industries, but it's hard to say without understanding the political climate.

threeseed 12y ago
It's not dissimilar to every country really. Critical or large businesses e.g. energy, telecommunications always have an unusually close and unfettered relationship with government. In China it would likely be closer similar to say Russia. Australia recently banned the use of Chinese equipment from our national broadband rollout for national security reasons so this isn't an unprecedented move.
- RockyMcNuts 12y ago
  Well, top government officials have big ownership interests in national champions; companies have party secretaries on site who can pull rank on management; trying to compete against companies with ties to government is generally going to be quite difficult...not exactly like every country. The iPhone is a luxury product in big demand, and being out of favor with the government will make it in even greater demand. The people targeted by Apple like their bling, people buy the foreign product because it's higher status and more trusted than the local product; in fact they'll go to Hong Kong to buy foreign products because they're afraid the one they buy locally will be counterfeit or crappy localized version. People trust Apple more than they trust the government or the Xiaomi knockoff.
eliteraspberrie 12y ago
In China, strategic industries like energy, steel, and telecommunications are state controlled. Huawei, for example, is a "national champion," which means it receives subsidies, foreign employees cannot own shares, the Party appoints an anonymous board to manage the company's management, and so on.

3 ms·

Can anyone chime in and help the rest of us understand the relationship between business and government in China? I can't help but think this is more of a move

by Glide 12y ago

threeseed 12y ago
It's not dissimilar to every country really. Critical or large businesses e.g. energy, telecommunications always have an unusually close and unfettered relationship with government. In China it would likely be closer similar to say Russia. Australia recently banned the use of Chinese equipment from our national broadband rollout for national security reasons so this isn't an unprecedented move.
- RockyMcNuts 12y ago
  Well, top government officials have big ownership interests in national champions; companies have party secretaries on site who can pull rank on management; trying to compete against companies with ties to government is generally going to be quite difficult...not exactly like every country. The iPhone is a luxury product in big demand, and being out of favor with the government will make it in even greater demand. The people targeted by Apple like their bling, people buy the foreign product because it's higher status and more trusted than the local product; in fact they'll go to Hong Kong to buy foreign products because they're afraid the one they buy locally will be counterfeit or crappy localized version. People trust Apple more than they trust the government or the Xiaomi knockoff.
eliteraspberrie 12y ago
In China, strategic industries like energy, steel, and telecommunications are state controlled. Huawei, for example, is a "national champion," which means it receives subsidies, foreign employees cannot own shares, the Party appoints an anonymous board to manage the company's management, and so on.