Shanghai

April 13, 2011

Shanghai, China

Coming to Shanghai for the second time after nearly four years, there were obviously quite a few differences I noticed. Shanghai, as predicted, has undergone much development and in my opinion grown up quite a bit since I was hear last. One major change that has been prevalent, with me at least, is that Shanghai has progressed even more rapidly than I had expected and has transformed into on of the major cities of the world, joining the ranks of the London, New York, and Hong Kong. I have written before about how on this visit I was interested in digging deeper and learning more about the real China. Shanghai has always been an amazing and fascinating city to me because of the huge disparity between rich and poor. On one street, on the Bund for example, there are 5 star hotels with rooftop restaurants charging prices that would make a New Yorker flinch while one block over street vendors are cooking noodles in the middle of the street for 3 Yuan. The disparity gap was simply amazing. At our hotel, for example, a drink at the bar will cost you the same if not more than it would in Atlanta, yet just across the street the small restaurant sells the same beer for 2 Yuan. In more developed cities the price differences exist but to only a very minor extent. Here the disparity is huge.

This was an element of Shanghai that caught my attention 4 years ago, and on this visit I was astonished to already see change. It seems to me that there has been a drastic reduction. Development has exploded. Everything has expanded. On this visit, Shanghai reminded me more and more of New York or Hong Kong. I was especially amazed at the growth and development in the Pudong Financial District. The area is a shining example of the new China. So many new buildings and development, it seems to be a shiny new Wall Street. On first glance I’m not sure which one looks more like a new developing nation.

As exciting as it is to see this success, as an American its scary. Over the past few days in our visit to Shanghai, we have visited a variety if experts from the CFO of Citi Bank to a officer of the U.S. Commercial service. They have spoken to us about a variety of issues, however, one message has stood out to me that they all have in common, America needs to wake up or it will be left in the dust. Politicians in the U.S. are focused on the wrong issues and while they are spinning their wheels China is moving forward, and fast. So fast that the rest of the world doesn’t even realize what is going on. While the rest of the world is sleeping, China is snapping up resources in Brazil and the Middle East, pumping huge amounts of resources into infrastructure. Just this morning on CCTV, the former Chinese ambassador to Brazil was speaking about the newly developed relationship and how important it is for the two. China is already trading extensively with the developing world at the expense of the U.S. developing resources for its future. It already controls 95% of the world’s rare earth metals. Compared to China, the U.S. hasn’t made any significant investment into it’s infrastructure, besides maintenance, in decades. These are disturbing facts for the U.S. and hopefully get its attention. If the U.S. does not get its priorities in order it will soon be looking up to China.

Future Plans, Present Promises

The Shanghai Urban Museum provided us with another glimpse of the incredible changes that the city of Shanghai and China are currently undergoing. The entire concept of five year growth plans are difficult to grasp. We ponder just how well planned, coordinated, and executed these five year plans have to be; from the central government playing an important role to the city government leading its cause for growth, to the interests of businesses and the community.  An assessment of the needs and wants has to be done.  The resources have to be secured. And the machine has to be well oiled to execute such plan to perfection.  Politically, this is a commitment that the government is making to its people. Economically, this is the vision of a city and a country of what is to come.  At the museum, the models are already set up and people can already see if a new shopping mall will be constructed next to their house or whether their homes or workplaces will have to be demolished in the name of progress. In our western ways, we cannot plan for the next two weeks as everything is always subject to change let alone for the next five years. 

Speaking of planning, as we made our way to the Shanghai Airport to continue our China Experience, the most basic planning that this group had engaged in, packing, was completely wrong. The wrong information had been provided and costs increased. Feelings and emotions were running rampant endangering the group synergy and experience. A common mistake that required nothing more than an apology became the wrench that had the potential to change our attitudes towards our planned activities. We cannot imagine what would happen if a wrench is thrown on the Chinese growth engine. Promises were already made by the Shanghai government to grow at a certain rate and the Shanghai Urban Museum is the vision and the contract made with the people of Shanghai. Five years of planning and promises is an enormous undertaking for any worldly institution to undertake.

Last Stop in Shanghai

Today, at the Shanghai Urban Planning Exhibition Center, we had the opportunity to not only see the Shanghai’s yesterday, and today, but also get a glimpse of the city’s future through professional exhibits and interactive displays.  This center is located in the downtown area, specifically in the people’s square.  The architecture of this building was inspired by the China’s traditional architecture with a large grid roof symbolizing the Shanghai’s city flower magnolia as shown below.

This is the city that held the Expo 2010 with an exposition theme of “Better City – Better Life” signifying the new status in the 21^st century as the “Next Great World City”.

The mascot of the expo, as shown below, is called the Haibao, which means the “Treasure of the Sea” and represents the Chinese character for men/person.

One of the most fascinating exhibitions inside the center was the model of the downtown area of central Shanghai.  Personally, I think the scale model of this city considered as the most populous city in China with a population of over 19 million people, was just incredible.

It allowed me to further my understanding of the city and motivated me to check out couple of its major developments (as shown below) within the remaining couple of hours prior to our departure for Qingdao.  I would definitely recommend this place to visitors and even locals.

Important Business Element in China: Guanxi

I have a good friend living in China. He moved to Shanghai three years ago to start a wine distributorship and is a testament to the cultural business encounters that we study throughout the GPMBA program. While in Shanghai, I was lucky enough to sit in on a meeting he conducted with a representative from another wine company. Though the details of the meeting were discussed in Chinese, cultural differences still stuck out, especially the theme of guanxi. In Chinese, this word means “relationships” and is a crucial element in business networks throughout China.

As it was my friend’s first meeting with the wine representative, business cards were exchanged in true Chinese fashion: presented and accepted with both hands, read thoroughly, and frequently examined throughout the meeting. Although little English was used, I was still able to gather that the conversation rarely touched on business. Instead, they focused on getting to know each other: talking about family, friends, and mutual interests. This revealed the importance of understanding the individual behind the business as well as the desire to establish a solid foundation through trusting relationships.  At the meeting’s close, the two businessmen had scheduled another dinner meeting for the following week, which was a success for my friend. I am grateful to him for sharing this experience and providing me with a first hand view of guanxi and its importance as a business strategy in China.

Urbanization Express