Talking business at the Shanghai Expo
Wellington Mayor Kerry Prendergast has led the largest trade and cultural delegation to China this year. About 70 New Zealanders, including 40 business people, visited Beijing, Tianjin, Shanghai and Xiamen from 6-13 June 2010.
Delegates met the mayors of Beijing and Xiamen, and spent several days at the Shanghai World Expo. Special events included a wine tasting night in Beijing, and the Chinese premiere of Peter Jackson’s film Lovely Bones, screened in Shanghai.
Maori violinist Elena (pictured), accompanying the delegation with a kapa haka group led by Tanemahuta Gray, launched a new CD at the expo that includes Chinese folk music.
The event, held at the New Zealand Pavilion, attracted huge media interest. The total circulation of the newspapers alone that covered the launch – including the Jiefang Daily, Shanghai Morning Post and Youth Daily – is over 4.5 million, and the SMG Art & Culture TV Channel was also there.
Kerry Prendergast described the expo as “the greatest shop window on earth”. “We are here to sell the goods and services of the New Zealand delegates.”
But friendship was equally important, she said. Wellington city has had a sister city relationship with Xiamen for 24 years and another one with Beijing for four years.
Included in the delegation was a group of Asia:NZ young leaders. They were welcomed at the New Zealand Pavilion by the deputy secretary-general of the All-China Youth Federation, Deng Yajun, who visited New Zealand several times in the 1990s.
Mr Yajun said he was impressed by the harmony he saw in New Zealand between people and nature, as well as the country’s efforts to preserve history and culture.
“I believe there’s a lot we can learn from your use of geothermal energy and the ways you protect your environment and protect against earthquakes.”
Wellington Central MP Grant Robertson, travelling with the delegation at his own expense, was wondering what the next significant milestone would be in New Zealand’s relationship with China, after the signing of the free trade agreement in 2008.
“We must give hope that we can leave our children the earth undiminished by short-term gain. We need to make changes. We must work together. The only real borders are those in our minds.”
Wellington City Council’s international relations manager, Tom Yuan, said the relationships the council had established in China over the last quarter of a century were like building a stage.
“Now it is the time for business people to play on that stage.”
The council’s relationships with senior officials in Chinese cities could be very useful to business people and New Zealand, he added. The former Mayor of Xiamen, Xi Jinping, is now the Vice President of China and visited New Zealand from 17-19 June, together with Asia:NZ honorary adviser Mme Li Xiaolin.
In Shanghai, the Wellington delegation held a networking night at New Zealand Central – New Zealand Trade and Enterprise’s upmarket meeting and hospitality suite in downtown Shanghai. The evening provided delegates with an opportunity to meet with New Zealand business people based in China's most populous city.
NZTE’s group general manager, Rod MacKenzie, said the expo had given Kiwi business people a reason to visit Shanghai and experience the event.
“There is no shortage of interest in New Zealand in China. But there’s a big gap between interest and those ready and able to trade here.”
NZTE’s next focus would be on ways to help bridge that gap, he noted. Companies needed to have the resources to visit regularly or be based in China. Building good relationships was extremely important. Companies needed the right product, brand position and partners. They also needed to understand the social and business culture and, if they didn’t have fluent Chinese speakers, they needed to employ trustworthy local people.
NZTE has commissioned research on successful business models in China which will be published when completed. Mr MacKenzie said it had also set up a team of four in New Zealand, led by a Chinese national, to build networks.
“There is talk of taking China by storm but big things don’t work. You need to take a long-term approach.”
This advice was echoed by Steven Odgers, the vice president of the ANZ SRCB Partnership in Shanghai, who gave a presentation to delegates at an ANZ workshop held at the Shanghai Rural Commercial Bank (SRCB).
“Culture saturates all aspects here,” he said. “You can’t do business as you would in New Zealand or Australia. At its heart are relationships.”
He said there were challenges and opportunities in trading in China. “There are strict and complex regulations applied with significant personal discretion – a discretion that doesn’t exist in New Zealand or Australia.”
On the other hand, predicted urbanisation would bring another 300 million people into cities by 2030, creating more opportunities by concentrating markets.
Protecting intellectual property was still a challenge. “Just assume it’s going to be copied and keep innovating,” he advised.
Innovation was attracting interest and the Chinese were prepared to pay for something new. “It’s not as price-sensitive here as in New Zealand or Australia,” he said.
Another speaker at the ANZ workshop, Colin Heads of Emborio Supply Chain Management, made an impassioned plea for New Zealand companies to extend their products and services down the supply chain where the money was – not just to ship them from the country.
“My mother and father grew the best lamb in New Zealand. They worked hard all their lives and never grew rich from it.”
Another New Zealander resident in Shanghai, Scott Brown of Redfern Associates, said that the overseas companies doing well in China have a long-term view and the right attitude.
“It’s not about resources. It’s about recognising how to partner.”
Mr Brown said establishing reciprocal partnerships took the risks out of sharing ownership. “You don’t sell the farm, just 30 percent.
“The problems for New Zealand companies in China are not here, they’re in the boardrooms of New Zealand. If you’re not in it for five or 10 years, don’t do it. Learn the rules, work with them and leave some salt on the table – negotiating hard doesn’t win here.”
As delegates marvelled at the buoyant mood of thousands of people walking down Shanghai’s promenade, The Bund, and caught the 300-kilometre-per-hour Maglev train to Pudong International Airport, they got a feeling for the wealth of opportunities awaiting them in China.
- words and photos by Chris Wilson
