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7. Finally, Tips from a Tsinoy Trader

(source: Mr. J.P. of Quezon City)

(Note: This section covers some topics that have been touched upon in the previous section. However, this is retold from the point of view of a Chinese-Filipino trader-ed.)

Lesson No. 1: Chinese businessmen are tough negotiators.

Lesson No. 2: Remember, you are setting up business in China. If the Government becomes you partner, what the officials say usually goes. Although on paper, China offers many incentives, it pays to know which government official matters.

There are two ways of getting things done in China: work from the top official down or work from the bottom up. For the well-connected businessmen, chances are they get to talk to the big guys: the governor, the provincial economic planner or even the provincial party secretary general. This method works well and good, but sometimes projects get stalled because some lower-ranked officials don’t get all the details of the project and don’t know or care what the fuss was all about since they probably never got to meet the top businessman.

The second way is to work from the bottom up. With some encouragement and "friendship", the lower-ranked official might lead you through the bureaucratic maze himself.

Lesson No. 3: The biggest mistake is for the uninitiated or unguided to persuade or lobby a project with people who don’t have the authority to sign contracts. There are approximately 31 million government employees in China.

Lesson No. 4: Basic courtesy is important. Remember that if the giver extends two hands when presenting something, it requires two hands to receive the item.

Never toss a business card from across the negotiating table. Also, the Chinese find it discourteous when one presents his/her calling card with one hand. It doesn’t hurt to stand up, approach the Chinese host to present the calling card, and nod slightly while doing it, too. This practice applies not only to presenting calling cards, but also books, gifts and other things.

 Lesson No. 5: Face is very important.

Punctuality at appointments is one way of extending courtesy. Host should arrive ahead of guests in restaurants. Escorting a guest not just to the door, but up to the elevator or the car is a sign of respect.

Even seemingly unimportant details, like who enters first—whether it’s into a room, a car—and who sits down first, matters as well. Usually, a guest should make a slight protest when waved in by the host, but he usually proceeds on second prodding. This might seem very trivial, but in China, every move reflects on one’s personality.

Lesson No. 6: Personal relationship in China is important. It is more important than any signed contract. If a friendship is terminated, the Chinese Government will likely find some loophole to end the partnership.

Lesson No. 7: Loyalty to friends and handshakes are traditions that will likely never change. While signed contracts are often done and pursued in these modern times, a handshake can still be more binding. Rules can be flexible; contracts might be changed, but friendship, never. When push comes to shove, invoking friendship can save the day.

Advice from an old-timer: Don’t just visit when you need something. The buildup of years of goodwill will pay off when one needs a favor, even just once. Develop a high level of trust, connections and favors can come really handy.

Lesson No. 8: Everything -- exploratory meetings, contract signings, rites of passage--start and end with a banquet. But hardly anything substantial is really discussed in such formal affairs. If it were the start of a proposed project, this event would be a getting-to-know-you affair. Boasting is not uncommon.

If it were a concluding affair, there would be a lot of toasting and motherhood statements. One would think it was an orchestrated event for a news release.

In a Chinese banquet, there are actually very few rules. No strict table etiquette applies—considering there are no dozen utensils to deal with as in formal Western table settings—only a pair of chopsticks and a bowl. In fact, using hands is encouraged—from eating fried pigeon, to crabs to Peking duck.

But for a host, it is important to serve the guest and the guest is "required" to "protest" mildly at the gesture. Often, this practice of serving is repeated for about two to three dishes, supposedly until the guest is comfortably settled in.

The host should pamper his guests. This shows sincerity and respect.

Lesson No. 9: Never drink the Chinese mou tai (liquor) on an empty stomach, or you will end up throwing up on your host. Actually, one can easily decline hard drinks by just mumbling something about a kidney or liver ailment. Take tea or sodas instead. The same is true with cigarettes that are another fixture in Chinese socials or cocktails.

The Chinese have become increasingly more sophisticated in their drinking taste. Instead of rice wine, brandy - which is believed to be a health tonic - is preferred nowadays. Increasingly, karaoke bars—such a hit in Taiwan and Hong Kong—are mushrooming in the urban centers as well.

Lesson No.10: If a businessman can’t speak the language, it might be wise to learn a few songs for entertainment.

If you can’t speak the language nor have difficulty speaking it, remember to bring guides conversant in Putonghua or Mandarin or the local dialect, such as Fookienese when visiting Fujian Province and Cantonese when visiting Guangzhou Province.

Lesson No. 11: Don’t nag.

If you are asking for something that is important, this is usually noted, so don’t try to be makulit, and ask the same question again. Often, a statement like "we will consider it" can be more sincere than the "sure, man" or "you bet" Westerners say after every other sentence. Displeasure is never shown publicly.

Lesson No. 12: Never pressure the Chinese. They may smile and seem to agree, but they will go back to their old ways and old methods. When they smile, foreigners never think anything is amiss. They have the delusion that their projects will be done their way and everything is fine. But behind the grin, they are actually saying, "forget the deal." They uninitiated sees lots of smiles, bows and banquets and thinks that the deal would be a cinch. The businessmen can never be more wrong. Remember politeness doesn’t spell agreement. Under such circumstances, they will never do things your way.

The Chinese are rarely rude, especially high government officials. Open rudeness can come only from one who feels inferior. Don’t shout or curse, the reaction can only be indifference.

Even to Western-educated but Chinese-conscious businessmen, Chinese officials usually speak in riddles, so don’t be surprised.

Lesson No.14: Important advice: to catch one’s attention, whisper!

The paradoxical Chinese are still modest in nature. When it comes to direct compliments like "You are beautiful", they often sidestep the comment. Since the Chinese appreciate a foreigner who understands their attitude, a Westerner should also refrain from acknowledging a compliment with a simple "thank you" as you most often would. The best response is for one to instead demur.