Next Phase of China’s Economic Miracle: Are Chinese Corporates Ready?
As China celebrates the 70th anniversary of the founding of the People’s Republic of
China, it has proven to the world it is possible to pull millions of people out of poverty,
become a global manufacturing hub and most importantly, chart its way towards
driving the development of new technologies such as AI, renewable energy and high
speed transportation systems.
In the process, perhaps facilitated by its entry to the WTO, multinationals across
industries - from upstream industrials to downstream retailing - have engaged with
China to source manufactured products for the world and to serve the rapidly growing
Chinese market base. Indeed, since the late 1970s, the Chinese economic system has
become an integral and strategic component of the global economic system.
What is most impressive is the rise of the corporate sector in China across multiple
industries. While companies such as Alibaba, Baidu, CNOOC, Huawei, Haier, Lenovo,
Ping An and Tencent have become globally known names, the market value of
companies traded on Chinese stock market rose from $0.498 Billion in 1990
(December 1st) to an impressive $8,421 Billion in 2019 (December 2nd); recently,
Fortune reported that in 2019, 129 of the Global 500 companies are head-quartered in
China.
Building on my observations of China’s socio-economic development since my first visit in 1987/1988, this paper addresses three questions:
- How should China adjust the next phase of its economic development to
cope with a changing geo-economic and geo-political environment? - What might be the nature of challenges that Chinese corporates will face as they gain increasing global visibility?
- Are there several universal guidelines that the leadership of top Chinese companies must adopt in becoming the “next generation” multinationals?
Major finance corporations conduct extensive management trainings that yield standardized processes and well-trained leaders. Executives in the tech industry would benefit from more intensive training, for ourselves and our staff members, before diving into or doling out management positions.