It's what some refer to as the great "call" of China -- the siren song of the most populous market on earth, one that is virtually untapped by outsiders. Ferocious foreign interest has zeroed in on this vast Pacific Rim nation due in large part to its switch to a market-based economy coupled with a growth rate of more than 8% over the past 20 years. Since China has weathered the financial storm that shook the economies of Asia, its 1.2 billion consumers are demanding everything from banking and agricultural products to entertainment and Internet providers. And now that the U.S. Senate has approved permanent normal trade status for China, the framework is set for a new U.S.-China trade arrangement under which China is to open its doors to American businesses and investors.
But doing business in China has never been easy, particularly for foreigners. Even with recent reforms, it is complicated by the profound differences between Western and Chinese cultures, the continued involvement of the central government, and the mainland's unique business values and philosophies.
"Doing business in China is difficult," explains Hong Kong businessman Lawrence Pang. The CEO of the technology company Digital Vision Multimedia, Pang now spends two-thirds of his time building offices in the mainland's cities. "China can be an ideal market. If you have adequate resources, intelligence, and endurance, you will be rewarded with insider status. But if you don't, you will see big losses."
Setting up shop in China hasn't been easy for Pang and other Hong Kong-based Chinese entrepreneurs, despite their proximity, shared heritage, and status as the biggest outside players in the market. While possessed of certain advantages, they too have had to deal with the great divide between the mainland and the rest of the world. But despite the challenges that China presents, some entrepreneurs have been successful. They offer these tips for other entrepreneurs contemplating a China venture.
Inc.com producer Stephanie Overby traveled to Hong Kong and mainland China as a CASE (The Council for Advancement and Support of Education) Media Fellow to study Chinese Entrepreneurship as a guest of the City University of Hong Kong.
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