Doing Business in China

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The second plenary session this morning addressed an issue that has pervaded nearly every other presentation about doing business at home and abroad. The session, “Doing Business in China,” included three people very familiar with the U.S.-China relationship and they provided some guidance on what an American company may expect when doing business abroad.

Ambassador J. Stapleton Roy, former ambassador to China and head of the Kissinger Institute on China at the Woodrow Wilson Center, began the session with an overview about the “fastest growing economy in the world.” Roy said that China was transitioning in a positive direction, but stressed that the government was still an active player in business relationships there. Due to that active relationship, U.S. government policy and engagement with its Chinese counterparts can have significant effects on a company’s business prospects. Barbara Hackman Franklin, former U.S. Secretary of Commerce, added that the “relationship between the two governments sets a tone for doing business.”

The conversation also touched on several difficulties companies face while doing business in China. John Frisbie, president of the U.S.-China Business Council, offered a list of problems that companies may face, including inadequate enforcement of intellectual property rights; finding and maintaining top talent; and government preference for Chinese companies. On the subject of intellectual property rights, the panelists said that while no company is currently immune from the weak enforcement of rights, especially software and movie companies, the situation is gradually improving. Roy pointed out that China wants to increase their own intellectual property creation and government officials understand that better protection and enforcement is essential to this.

The panelists left the audience with an understanding that the Chinese market has huge potential but there are many complex aspects that must be thoroughly considered and explored before doing business there.

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