The importance of cultural understanding

“As for the future, your task is not to foresee it, but to enable it”

                                ~~Antoine de Saint-Exupery~~

For the past fifteen years, America has been the most prevalent influence on the global stage and the rest of the world, whether classed as developing or developed, has consumed a seemingly endless stream of American media, products and culture.  In most part, for the Western countries at least, this mass exposure has been easy to digest, as the American culture does not differ too much from that of Britain and other European countries. Now the positions of global power, based largely on economy, are shifting and China looks set to soon be glorified as the world’s newest ‘super power’.

In Europe, America is fun to hate, not because of a lack of cultural understanding, but more of a tongue in cheek amusement over the brashness of a baby country that grew up too quickly. America bashing is made easier by the fuel that is provided by the media, Bill O’Reilly being a particularly petrifying spokesman and campaigner of hate. However, I have grown to love America, and even more so the American people, who, whether intentionally or otherwise, are a pretty constant source of amusement to me. One of my favourite pastimes when travelling around the world is to take pictures of artifacts or architecture dated 1200 or 1600 and tag my American friends with a not-so-witty, ‘older than the founding of your country,’ posted beneath. The ‘Team America’ theme tune has become pertinent over the years, as more and more soldiers from Britain and the United States have been deployed to countries under the guise of human rights and in turn this has fuelled ardent indignation over the concept of ‘America’ and ‘Americans’. The fact is that since the beginning of man’s unruly reign over this beautiful Earth, there has been super power after super power, the only difference now is that since the First World War, we have developed the concept of human rights. In comparison to the super powers that came before it, God’s country aka Great Britain being a prime example, America is really pretty tame in terms of its destructive qualities. The concept of an ‘American’ is equally as ignorant as the idea that ‘America’ is a purely tyrannical force. In a country that spans a total of 9,629,091 square kilometers and has a population of 312,489,433, it is impossible to over generalise: there are people of every religion, ethnic origin, spectrum of mental illness, intellect, creativity and every flavour of strange. For a writer, this is absolutely delightful. The point is that it is far too easy to judge the images played on the television screen, or to believe what is told to us in the newspapers or online. Quite simply, far too many people judge without ever really knowing, ‘under the guise of good intentions and defending our values we often feel that we have the right to sermonize and demand that others behave the way we do’, Anne-Laure Monfret, author of ‘Saving face in China’.

This is a large problem when related to China. While the world, particularly Europe, has sometimes made extreme judgments on America over the years, the culture is at least understood to a certain degree. Now China is becoming an important influence on the world, particularly with the global economy and many foreign businesses now rely on the Chinese for progression and financial backing. The culture of the Chinese, a civilization which has stood solid for thousands of years (there will be no picture with ‘witty’ slogan for my Chinese pals), is massively misunderstood. In my very short time living in China, I have had the privilege of writing articles which focus mainly on Chinese culture and as such have interviewed several people about the main issues foreign people experience when moving to, doing business in or visiting China. One of the biggest factors ingrained within the Chinese culture and history, dating back to before the age of Confucius, is the concept of mianzi-the preservation of face. This is of paramount importance in every single aspect of Chinese life and is a crucial factor when building relationships with the Chinese, whether it’s on a business, personal or base level. As a Chinese proverb states, ‘A person needs a face like a tree needs bark.’ To lose face is to lose social status and respect, and yet it is something that is misunderstood or completely overlooked by many foreigners who come into contact with the Chinese.

I am currently writing a review for Shanghai Daily on French author and journalist Anne-Laure’s fantastic book ‘Saving face in China’. The first of its kind, the book deals with the many issues and cultural complexities that arise on a daily basis as a consequence of building and losing face. As Anne-Laure commented, ‘in China, everything is founded on a system of relationships and the cultivation of trust’.  This can be seen to be true of the majority of countries in this wide and wonderful world, but in China the extent to which this is true is really quite surprising. Mianzi applies to everything: from humour to gift giving and receiving, to paying the bill and even the notion of truth, there is a custom for it all and the Chinese are almost wholly unforgiving of any deviance from this, whether you are aware of your mistake or not. As I become more and more aware of this, I am realising how many times I must have made Chinese people who I have come into contact with lose face and consequently lost face myself. The concept of face is interpersonal-I give you face, you give me face; we lose face together.

Many foreigners are very quick to criticize the Chinese, viewing many of their habits such as spitting in the street or barging straight onto trains as rude. Additionally, there appears to be a level of judgment that sees a country of 1.3 billion as mindless subordinates of a controlled society. They overlook the progression of China while the majority of the West stagnates, they chose to ignore that China is booming and is doing so because of the Chinese. The truth is, several of us in the West are stuck in the belief that we are the top dogs, that countries such as China are developing and therefore beneath us and this is simply not the case. There is a lot that we can learn from the Chinese and some serious importance in doing so.

China-the source that feeds the consumer

Over the past twenty-five years, China’s economy has developed rapidly to the point where China is now one of the world’s leading importers and exporters, with a year-on-year growth of 25.8% as the total calculation for import and exportation for 2011. The profit on exports alone was calculated to have grown by 27.6% in the first half of 2011 and despite recent slowdowns in exports and slowing GDP growth rates, both economic indicators remain the envy of the developed world and look set to continue strong growth in the coming years. In 2006, China export hub stated that China was ‘getting the opportunity for optimal usage of its resources and raw materials, which ensures it becoming one of the major markets in the global platform.’ Today, China is developing at an extreme rate with one of the fastest growing economies in the world. As many of the other major global economies suffer declines or stagnation, this position is made more pertinent; China has become an exciting place to be, rich with opportunity for professional growth with a drive for progression and innovation, ‘what will drive the Country is the passion’, commented Serene Wong, CEO of leading Chinese research consultancy TNS Research International.

China, India, Brazil and Russia are known in economic business terms as the BRIC economies, developing markets in which businesses have the opportunity to flourish. Consequently, many businesses have set up operations in these countries, as well as utilising their factories and resources to source key elements for export to other markets. China is one the largest sources for international trade, and America is the biggest importer of Chinese goods. The American trade deficit with China has grown from $10 billion in the 1990s to over $200 billion in 2011, this essentially means that America imports over $200 billion more than it exports; the inter-dependence of these two global economic titans significantly  favours China. The recent legislation which states that China is under valuing the RMB, making Chinese goods cheaper for American companies to buy and ensuring a continued increase in exports, conveys the belief among many developed nations that sourcing from and outsourcing to China has led to a rapid decrease in job sustainability inside the US and other developed economies. As long as the RMB stays low against the dollar, the incentive to buy, trade and produce within the USA is reduced; it’s simply not as cost effective as sourcing materials from China or outsourcing whole operations to the Chinese mainland. However, this balance is a difficult one to maintain; should the cost of importing from China increase, factories and businesses will begin to move to the next cheaper countries.                                         

While production in China is often not as cheap as other countries such as India and Vietnam, the country remains a primary focus for business and trade because of its high productivity levels and willing workforce. Indeed it’s fair to say that while the BRIC economies are at the heart of all major corporation growth plans, they do not see them as equally interesting, ‘several companies are placing more emphasis now on China than on Russia because they see it developing more quickly, operating with more favourable trading patterns and with a government willing to invest in its infrastructure,’ Andrew Turton, Global Development Director of TNS Automotive. The ‘China phenomenon’, China’s fast developing economy and significant position on the global platform is linked in large part to businesses in other countries sourcing materials from China or outsourcing whole units of operation. Both provide significant economic benefits to the country. While most people have a sense of what outsourcing means the concept of sourcing is often less well understood; briefly by way of explanation, there are many types of sourcing but the most common is a procurement strategy for acquiring materials from countries with lower labour and production costs in order to cut operating expenses. In this model, production still takes place elsewhere; an example being Australia’s acquisition of copper and other metals from China. Other examples of sourcing include production of goods: the well-known ‘made in China’ stamp, and procurement of goods on mass.

Every April and October, China holds a massive trade fair in Guangzhou, which has become the factory and production focus of Chinese trade. The 110^th Canton fair is taking place between October 15^th and November 4^th and is a valuable opportunity for businesses sourcing from China to explore the variety of products on offer. This also allows companies to observe the standard and quality of the goods that they intend to export from China. This is an important factor in trading with China, ‘as long as the company has a heavy involvement in the country, it will be done ethically. As long as you ensure it is ethical, it’s a fair trade. It’s often much more expensive to produce inside their own country, especially for Western businesses. Why would a company pay ten times the price?’ commented Serene Wong, CEO of TNS Research International.

The Canton fair is divided into three stages which are spread over the three week period. The first stage focuses on machinery and electronic equipment, the second on home and decoration and the third on textiles, garments and fashion accessories. The scale of the fair is considerable; covering several floors and a large surface area, Canton fair is the largest trade fair in China. The fair brings additional revenue to the Guangdong province, as tradesmen from across the world come to visit the fair and hotel prices escalate. ‘The fair is a great opportunity to see what’s on offer and how certain markets are expanding and evolving. Exporting from China is lucrative because it is cost efficient and quick; the Chinese have developed a lot of great methods for production’, Laura Milot, ERC.

Due to production costs, companies often design goods within their own country and have them made in Chinese factories. However, this has become a huge opportunity for the Chinese to learn about the designs and products of other companies and as such, the innovative drive in China is increasing and the speed at which China is developing inside of the country is extreme. Shanghai is a show case for this development   - the skyline is constantly changing, the opportunities for professional development continue to evolve and many more businesses are beginning to establish offices in Chinese cities, including lower tier cities where potential growth can be maximised. Chinese products are consumed around the world, which has the effect of significantly boosting the economy. Consumption within the country is also escalating and the Chinese are quickly becoming one of the world’s largest consumer cultures. In the past, China produced to feed the consumption needs of the west, this is now changing as China’s middle class continues to increase and mass urbanization has served to shift the need-want ratio. More and more, foreign brands are bringing their products to China to sell to the increasingly eager Chinese consumer. With a population of 1.34 billion people in China, foreign brands see a great potential in the Chinese market. China’s position as the world’s single largest economy is only just around the corner.

The ‘China phenomenon’ is a continued source of interest to economists and social anthropologists, as well as much of the developed world. China is far more than an emerging market; it is a catalyst for progression, innovation and new process of thought. The Chinese do business in the present, sustainability is not a key area of concern and as a consequence the country is able to seamlessly evolve with the ever changing demands of the digital age.