CKGSB Knowledge - China Business and Economy Fall 2019

China’s central bank, the People’s Bank of China (PBoC), announced in August that it would soon roll out a national digital currency to replace cash. If it does, China would be the first major country to do so, and would set a trend that has the potential to upend the entire global financial structure. Some experts have speculated that China’s digital currency will be a crypto currency similar to Bitcoin, which is built on a blockchain model allowing for vastly dispersed control and anonymous transactions, but most indications are that it will rather be a centralized currency that looks and acts much the same as what already exists in the marketplace, except in a digital form. China is able to lay claim to being the birthplace of paper money, during the Song…

The ongoing trade war between China and the United States has claimed an unexpected casualty: China’s burgeoning film industry. Projects that involve American actors and plot lines that take place against a US backdrop are suddenly out of favor and Chinese movie producers are killing projects and firing US thespians, citing concerns over an uncertain future between the two countries. A big-budget film about Chinese students in the US, Over the Sea I Come To You, was abruptly canceled even after a Beijing launch party was held. A number of other productions have also been cut, postponed or proceeded with Russian and German actors in place of the originally-chosen American ones, and films about fighting the Americans in the Korean War in the 1950s are hot again. China’s film industry is just…

With no immediate end in sight for the trade war between the world’s two largest economies, and with no signs of a fundamental easing of tensions between China and the United States, how are American companies in China caught in the crossfire coping? The American Chamber of Commerce in China, led by president Alan Beebe, is a nonprofit, non-governmental organization whose membership includes 4,000 individuals from 900 companies operating across China. The Chamber’s nationwide mission is to help American companies succeed in China through advocacy and business support. Beebe joined AmCham China from Ernst & Young (EY). He has also held executive positions with The China Greentech Initiative, IBM and management consulting firms A.T. Kearney and PRTM. He has 20 years of management consulting experience in China, other Asian countries and the…

In the eastern city of Hangzhou, Chinese conglomerate Alibaba’s “City Brain” technology has been, quite literally, stopping traffic. It controls nearly all traffic lights in the city, thereby helping first responders to reach emergency scenes in half the time it took in the past and shortening daily commutes for drivers. In the capital of Beijing, American-born resident Shaun said the city’s air has improved so much that “Beijing’s air is no longer a deal-breaker,” to living there. The better air quality can be attributed to a variety of factors, including new digital technology such as the Blue Map smartphone app. Created by the Institute of Public and Environmental Affairs, Blue Map is used by city officials in real time to take steps that include forcing factory shutdowns to reduce pollution. There is…

For more than five decades, Mars Incorporated—a multinational family-owned company, makers of iconic brands like M&Ms, Mars, Snickers, Dove, Uncle Ben’s, Pedigree, Royal Canin, Wrigley’s and more—has invested in Catalyst, its internal think tank which provides insights on leadership capabilities and develops business solutions to ensure Mars is always at the forefront of what it calls “the thought leadership space.” Bruno Roche has led Mars Catalyst globally from Brussels since 2006. Under his leadership, Catalyst has developed groundbreaking methodologies in the areas of marketing effectiveness and M&A integration. It has also expanded geographically from its United States and European bases to become truly global by covering Asia and Africa. Spurred by a question posed in 2007 by the leadership of Mars Incorporated—”What is the right level of profit for a corporation?”—Catalyst developed…

On a midsummer’s day in late August, Chinese shoppers went to war with each other at the opening of Costco’s first store in Shanghai. Widely shared videos on WeChat, China’s popular social media app, showed security guards struggling in vain to hold back impatient shoppers from entering the packed store, and a crowd fighting over a piece of raw meat at the butcher’s counter. The throngs of shoppers cramming into the US-based bulk-buy emporium, which forced it to close early on its opening day, were in stark contrast to the steady flow of foreign supermarket operators exiting China. In June, French supermarket giant Carrefour became the latest to wave the white flag—announcing it would sell an 80% stake in its China stores to local e-commerce retailer Suning for €620 million ($685 million).…