How Should China Change Its National Brand? by [email protected]
Huiyao Wang on China’s national brand
Few are as qualified as Huiyao Wang to analyze China’s future. He is the founding director of the Center for China and Globalization, a Chinese think tank on global talents, returnees and migration, and he has also been a Ministry of Foreign Trade and Economic Cooperation official. Today Wang is a senior fellow at the Harvard Kennedy School, among other activities. Ahead of his October visit to speak at the Wharton Nation Brand Conference, Wang spoke with marketing professor David Reibstein about the best future course for Chinese business and the nation’s brand.
Made In China
David Reibstein: What is the Center for China and Globalization and its mission?
Huiyao Wang: The Center for China and Globalization is the largest independent think tank in China. We have been established almost nine years now, and we are lucky that we are ranked by the University of Pennsylvania’s Think Tank and Civil Society Program as 110th out of the top think tanks in the world, No. 7 in China and the No. 1 for independent think tanks in China. We’re fairly large and have almost 100 people in research and on staff. We have several locations in China, including Beijing, Shanghai and Guangzhou.
The mission for the CCG is to become a bridge and a platform for the exchange of scholars and researchers and policymakers and the business academic community, in terms of strengthening the process of China and globalization. Also, its mission is to serve better the policy community, both in China and the outside world. We want to be a bridge and focus particularly on the globalizing of the talent and the enterprises, and the migration between China and other countries.
Reibstein: You have been a consultant to many global companies such as GE, Siemens, ABB, Westinghouse, Mitsubishi, and so on. And I’m assuming you have worked with them to better connect them with China. But you have also been responsible for numerous Chinese firms going global. Is that the primary responsibility of the center?
Wang: Yes. CCG hosted a large conference in Zhejiang Province, which just concluded the G20 Summit there. We had people from several hundred countries to talk about globalized enterprise in the contemporary world — basically how to invest in China and invest globally. We are having another conference called China Outbound Forum, which will have several hundred Chinese firms come regarding Chinese investment overseas. So, our center does involve a lot of exchanges and also promoting the cooperation between Chinese enterprises, multinationals, foreign enterprises and Fortune 500 companies. We do involve quite a bit of business exchanges and collaborations.
Reibstein: Let’s talk about how China is perceived globally and how you’re trying to promote the image to better attract businesses to China, as well as acceptance of China’s businesses overseas. China is well known for its low-cost manufacturing. But I’m curious about what other characteristics you think should be better understood about China outside of China.
Wang: That’s a very good question, thank you. I think since China has opened up, gradually the image of China, particularly for Chinese enterprises, has changed a lot. In the past, 30 years ago, all businesses in China were state-owned enterprises. Now, at least half of the enterprises are privately owned. That’s probably the image that China should show the world, that China is not only a country with state-owned enterprises but with a very vibrant and actively rigorous private sector as well.
“Thirty years ago, all businesses in China were state-owned enterprises. Now, at least half of the enterprises are privately owned. That’s probably the image that China should show the world.”
For example, the private sector employs about 70% of the Chinese workforce. Multinationals and foreign enterprises have employed over 60 million to 80 million of the labor force at one point in time. I think there are a lot of good stories that should be told. For example, Wal-Mart, one of the biggest companies in the United States, is in China producing $20 billion a year of different products that are made in China that keep consumer prices low in the U.S.
I think the dialogue and the communications between Chinese companies and outside foreign companies sometimes are less well understood. When a Chinese company is buying a company in the U.S., sometimes it would be regarded as negative. But some are good examples. For example, we know that the U.S. government in recent years has been calling for Made in the U.S.A., and trying to attract back the manufacturing sector. We know that some U.S. companies and government officials have come to China. We know that one of our friends, a company like Fuyao Glass, one of the largest auto glassmakers in China and probably one of the largest in the world, now has invested $600 million in the United States. Now they have several factories in the United States, making all the glass for the American industry.
Examples like that should be well talked about and the story should be told so that they have a better understanding. They come to the United States, they begin to create jobs, they begin to offer employment, they’re going to generate income. I think this kind of a story on both sides, like Wal-Mart being one of the biggest foreign employers in China, is really good. The globalization benefits both countries, both countries’ people and the companies. I think in order to promote image, maybe those stories should be well told and explained.
Reibstein: Wal-Mart is an interesting story. By the way, I should let you know that my first time going to China was 1981.
Wang: Oh, that’s very early.
Reibstein: It’s very early. I’ve got all sorts of stories I could share about that, but I’ll do that when you’re here in the U.S. But I know that Wal-Mart got into China fairly early. I find Wal-Mart a really interesting example because when they were operating before going into China, their trademark was that all of their products were made in America. Then they dropped that. Obviously, they get a large number of products from China. But if I think about a global brand for a company, it becomes very difficult because within the United States they’re known as very low price. But in China, Wal-Mart is not the lowest-priced retailer.
Wang: That’s right.
Reibstein: It’s interesting how they have a different image within China than they do in the United States and elsewhere in the world. I suspect that’s true for the brand China itself. Since you mentioned Made in the U.S.A. as something that at least our current political candidates have been bandying around, there was the Made in China campaign that has been advertised quite broadly. Do you have any thoughts about that particular campaign, whom it was really targeted toward and whether it’s been successful?
“Fuyao Glass, one of the largest auto glass makers in China and probably one of the largest in the world, now has invested $600 million in the United States.”
Wang: I’m not too familiar with that. But I think that one