One is a kind of envious truculence in the West. While North America struggles to grow — and Europe not to shrink — the economies of China, India, and Asia generally (Japan excepted) are doing dandy. The rise of Asia is a big shift — it’s the big shift — and the fact that everyone has seen it coming for at least ten years doesn’t make it any easier to take, particularly when the West can’t seem to shake the recession.
Thus you hear complaints that Asian companies — Chinese especially — are “cheating,” for example by subsidizing clean-energy industries. At an IT company I know, executives mutter that national-champion Chinese rivals have so much sanctuary at home that they can offer low-ball prices in other markets, echoing GE CEO Jeff Immelt’s impolitic complaints earlier in the summer. You hear objections — legitimate ones — that the Chinese RMB is undervalued. And sometimes you hear sour grapes, like the loony-on-its-face argument that China’s not worth it anyway, or it won’t be for long (too aging, too dirty, too hard), so why bother, as Sean Silverthorne reported the other day.
Well, guys, suck it up: It’s competition, not a walk in the park. Extremely rough competition, to be sure, but it has to be fought, not ducked. China does favor its own; in this respect it shares a crowded stage with Britain, France, India, Japan, Russia, and the United States, among others, if not now, at various stages in their history. And while there are lots of reasons not to admire Chinese state capitalism, the West has only itself to blame for the political gridlock that holds sensible policy ideas hostage to Pyrrhic pursuit of electioneering edges.
A new essay by Peter Thiel, president of Clarium Capital Management and co-founder and former CEO of PayPal, speaks two truths about the world’s economy that are so important and obvious that people forget them: “There is no good bet against globalization” and “There is no good scenario for the world in which China fails.” You can translate those almost word-for-word into two pillars for company strategy: There’s no escaping global competition, and there’s no winning globally without a China strategy. Both the broad and the corporate truths are evident here, where most people are too busy overcoming obstacles to complain about them.
A few years ago, it was enough to think of China as a staging ground for exports and for some things a market. Now it’s those things and more. We have entered the third stage of globalization, following the globalization of markets and production: the globalization of intellect. In this third stage, we can see in the East the emergence of sunrise industries like cleantech and biotech. In it, countries like China have become the breeding ground of fierce competitors — “new champions,” as the WEF calls them. Sure, incumbent companies can and should cry “foul” if it’ll help; but foremost, they have to roll up their sleeves.
Follow him on Twitter @thomasastewart
http://www.bnet.com/blog/strategist
Click the link below to read Part 2:
Why China Is Getting Easier to Play, But Tougher to Win (Part 2) -
http://www.entrepreneurcountry.com/articles/tom-stewart-on-the-other-hand/416-why-china-is-getting-easier-to-play-but-tougher-to-win
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