20100827: Trip to Chongqing

8:43 PM Friday, August 27, 2010 Heading at 151 km/h on the trusty D5120 from Chengdu North Station to Chongqing Bei, also the north station. The approx 420km trip takes just over 2 hours, so our current speed is disappointingly lacadaisical. I have sent orders to the lower decks for the slaves to pedal harder but to no avail. The ‘over’ is either due to engineering works, or due to the fact that extra carriages have been added to this train, the last Friday evening departure to Chongqing.

This train has 16 modern carriages which European high-speed rail enthusiasts could mistake for their own, apart from the dominance of Asian clientele, the different signage, and the gleaming aluminium toilets sunk into the floor, as ‘squatties’ are still the lavatorial design of choice. Otherwise the lavs feature all mod cons, including taps activated by infrared-sensors, and a light-touch button to activate the flush, and paper supply is plentiful. Fortunately, I’ve just recovered from a 2-day bout of food poisoning, the theme of which was ‘Just passing through!’ , so I have not had to fine-tune my surfing or snowboarding skills by squatting at 200 km/h, trying to maintain accurate aim.

I write this at 165 km/h as I’ve been lucky enough to get 1st class tickets, which, at 117 RMB (about 11 pounds) are 20 RMB more than the second class tickets. For the extra couple of quid, you get a slightly wider chair (premium economy rather than full horizontal sleep-pod) and your very own AC power socket to enable anti-social engrossment in technological gadgets such as laptops or iPhones, iPads, and other iNotalktoyou devices. In this developing country, many of the passengers are reading e-books on handheld playstation gizmos, texting on the latest smartphones, devouring KFC, listening to the iPods. A couple of people are reading books. Different electronic sounds emanate every 15 seconds from principally from phones with irritating notification tones. However, overall, it’s pretty quiet on the train and it’s a very nice trip, as it is when one is demoted to mere second-classness, generally because the first class tickets sell out so quickly. The second class tickets see in much the same comfort as in 1st class, minus the electrical socket availability (for a 2-hour trip, not a major problem with some proper planning) and instead of 2 sets of widish seats on each side of the aisle, there are 2 and 3 slightly narrower seats.

China is developing thousands of km of high-speed train lines, and in the process will make some air routes redundant. The VIPs and top businessmen used to take the plane between Chengdu to Chongqing, but now it is slower to do so than taking the train. The Chengdu to Chongqing flight used to consist of: driving 30 mins to the airport in Chengdu, spending 45 mins at the Chengdu ShuangLiu airport (if there are no delays) (never a joy, since its superior catering option is KFC. Elsewhere in this institution of jealously controlled franchises, a cup of tea can set you back 5 pounds), a 45-minute flight (most likely with a princely repaste of a bottle of water and a packet of crackers), 10 minutes for Chongqing formalities, and then 45 minutes’ drive into the labyrinthine Chongqing. Now, for probably 20% of the total cost, the journey from city centre to city centre takes two hours, and by 2014, it will take just 50 minutes.

That express link will bring immense changes to the Chengdu and Chongqing. The daily commute to school will become feasible, for example. Anyone who has lived in Chengdu and Chongqing, will instantly see another popular life-work choice: live in Chengdu and work in Chongqing. Chengdu is known as relaxed and very ‘livable’ city, not least due to its climate, milder than Chongqing’s (one of China’s ‘furnace’ cities), and its flatness. Chongqing, city of hills and of an extended population of 30 million (Chengdu’s is a mere 11 million or so), is a metropolis which is, ahem, steeply on the rise, particularly after the powerful go-getter Bo Xi Lai took over as mayor, but is harder to ‘get into’ than Chengdu, and certainly harder to get around. Currently, businesses will most likely appoint a senior manager based in Chengdu, who either grudgingly attempts to manage the Chongqing branch from afar, or spends a lot of time staying in Chongqing.

The investment is pouring in and parts of the city are reminiscent of Hong Kong – think of skyscrapers, dominated by financial institutions, crowds of people pacing purposefully office-ward. – but Chongqing has a great deal more space to build than HK, and many of the buildings just a few hundred metres’ walk from the newer high-rises in the CBD (Commercial and Business District) are shabby and look like they are in need of rebuilding. It’s a paradise for cash-rich developers.

20090318: Tim Clissold at the Bookworm Literary Festival

Speaking as part of the 2009 Bookworm Literary Festival, Tim Clissold was engaging, knowledgeable, an excellent public speaker and whose quite confidence and liking for deprecating humour made him one of the most successful speakers at this year’s Chengdu events.

The Sichuan leg of the Beijing – Suzhou – Chengdu triangular tour gives the writers a chance to escape from the ‘coastal’ towns and enjoy the more intimate and relaxed location.  Small audiences (20-30 people is typical) get the chance to chat with the authors in the Q and A sessions and afterwards in the restaurant/bar area.

Tim Clissold’s ‘Mr China’ (Asian Review of Books review) (info on Harper Collins website) is considered essential reading for any western investors thinking of coming to China.  It tells the story of a company which invested about 400 million USD in 7 different companies in China between 1995 and 2002 and how they sought to make money out of their controlling stakes in these companies, mostly in the automotive industry.

Tim Clissolds Mr China, hardback cover

Tim Clissold's 'Mr China,' hardback cover

Clissold spoke for 25 minutes about the book, summarising the story, before contemplating the relevance of the story told by it.

A summary of Tim Clissold’s summary: Tim used to work for Arthur Anderson, then travelled around China (from Pakistan border, down along Silk Road, to Chengdu, then Beijing, then train through Russia back home), then studied Mandarin in London, then for 2 years in Beijing.  Whilst there, he met a Wall Street money man looking to invest in Chinese companies.   The money man quickly raises about 100 million USD for investment, which they invest in businesses around the country, and a further 2 or 3 similar tranches of investment are secured and invested.  With over 400 million US dollars invested, their task now is to make sure that the companies are in a fit state to make profits.  Given that most of the businesses, although they now have a foreign company as their controlling stake holder, are state-owned companies or former state-owned companies, many changes are required if profits are to be generated.  The issues include poorly motivated staff and management; factory managers who are not mere business managers, but almost mayors of their factory towns, and therefore are not fully focused on revenue creation; factory managers building new factories to manufacture different products (in one case gearboxes) without asking for investor permission; factory managers building new factories to compete with the foreign investors’ factory; USD 3 million of cash from a business being flown to the USA by one manager with an HK bank manager who issued 4 compulsory letters of credit, having gone missing for days previously; investors outside China who demanded quick results; a resulting near nervous breakdown for Tim Clissold, due to the stress of the possibility of 25000 people losing their jobs, the difficulty of managing the investment and coping with the other challenges; the list is as fascinating as it is wide-ranging.

Points raised by the author during this part of the talk are the need to understand the different role of a factory manager in a village/town factory, the differing motivation for management in China and Wall Street, the need for patience, diligence and a constantly open eye for detail and potential pitfalls, and persistence.

Clissold then went on to ask why, given all of the difficulties outlined in his book, investors wanted to come to China, and, more pertinently, why western investors and business men often behave in business in China in a whay that they would never do in their home country.  The magical temptation of the 1.3 billion customers is part of the charm, as is the entrepreneurial spirit of so many Chinese, something which Clissold said his impression of the Russian enterpreneeurial spirit was nowhere near as positive as that in China.  (“Even the way they sell vegetables on the street shows the entrepreneurial spirit.”)  Now that China is a huge part of the global economy, Clissold said that western companies cannot ignore China just because of the challenges it poses for incomers.  What China now does with its 2 trillion dollars in cash/bonds will be crucial to the world’s (non-)recovery.

Clissold stressed that although ‘Mr China’ gives the impression that business is difficult and/or impossible in China, they did get the businesses back on track and that they did not have the benefit of being able to ask other western investors for their experience in China, given that they were pioneers in trying to control investments and companies.

The author does not want people to be put off from investing in China, since the west must continue to engage in business in the world’s largest market.

Clissold said there were 4 possible responses to the story:
1. Decide never to do business in China because it is too hard
2. Ask why the company was so stupid that it was duped so many times
3. Sue everyone possible
4. Engage with the country very flexibly, with an open approach and a willingness to understand and look at what is actually possible (particularly with a younger generation of consumers and managers coming through).

The 4th (a very brief summary) is his choice.

Tim Clissold is now involved in setting up carbon trading systems in China, not, he stresses, just to ‘offset a tonne of carbon emitted in Australia against one in China’ but to influence energy and infrastructure investment choices to encourage the uptake of greener technology in the world’s leading carbon emitting country.

Tim Clissold also chatted with Steven Fan, who is mentioned on page 50 in the paperback as a keen interpreter.  It is the first time they have met again since they first worked together.
Click here for photos of Tim and Steven as they chat at the Lit Fest

20080625: work, footy, SQR

Still at work, which is going OK. We’ve introduced a system whereby our customers can actually look at the status of their own orders online, which is very nice of us.
Also the boss is offering training, 2 half days. During one of those I’ll have Chinese lessons and in the other I’ll carry on learning how to design relational databases. All thrilling stuff of course.
We played football yesterday at Sichuan University yesterday on a drippingly humid evening against a bunch of local students who never gave up and were really rather good. Sadly the Leg and Whistle team has some excellent players so the score was approximately 34 – 3.
Sichuan Quake Relief – work goes on, mostly by other people, and the hope is to establish an NGO to get more cash and continue to provide emergency shelter and food and other supplies in the short term, and to set up a hub of information to allow communities to get information out and donors to target their donations.

20080617: back to normal

Things are getting back to normal, with the standard 9-6 going on at work.  The suppliers have not been affected by the earthquake, but are still late, which is at least standard practice in industrial supply chains.  The flat needs a few bits of touch up, to cover the cracks and repaint.
Thinking of trying some flexi-time at work, perhaps taking two half-days, since I’m rather stuck in a rut at work, but also to mug up on Chinese and on database design.  Luckily the boss has been v. understanding and is willing to give it a try to see how it goes.