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Asian Financial Forum 2015





Recent Posts

  • Seeking flow of funds to/from China One of the opportunities available to delegates to the Asian Financial Forum in Hong Kong on 20 January 2015 was to participate in a "Deal Flow" or business matching session ...
    Posted 9 Feb 2015, 20:19 by Peter Black
  • Inside the Chinese Mind I had the benefit on the Invest in Australia Mission of being introduced to Geoff Baker, originally an Australian lawyer and investment banker, who co-authored with his Chinese ...
    Posted 8 Feb 2015, 16:49 by Peter Black
  • Audience with Nobel Laureate economist Paul Krugman The keynote luncheon speaker at the Asian Financial Forum on Tuesday 20 January 2015 in Hong Kong was Nobel Prize winning economist and New York Times columnist Professor Paul Krugman ...
    Posted 7 Feb 2015, 17:16 by Peter Black
  • Running your business in China in Google Apps - NOT! Before going into China, I had been vaguely aware that the Chinese government had blocked Google access but had not really paid any attention to it as I did not ...
    Posted 7 Feb 2015, 17:18 by Peter Black
  • Importance of Chinese personal and business names I mentioned in my earlier post "Being prepared to do business in China" about the development of appropriate personal and business names to conduct business in China. The process behind ...
    Posted 9 Feb 2015, 20:37 by Peter Black
  • Dealing with the CIA in Asia Before the Central Intelligence Agency from the US gets worried, I have "hijacked" the acronym CIA to represent what I have concluded is the significant market opportunity sitting to the ...
    Posted 7 Feb 2015, 20:43 by Peter Black
  • China and Hong Kong centre of the world I hadn't appreciated until reading the Business tips on the Qantas inflight system on the trip to Hong Kong that China actually means "Central Nation" - which has its origins ...
    Posted 7 Feb 2015, 20:46 by Peter Black
  • Australia open for business As  a prelude to the Asian Financial Forum in Kong Kong, the Invest in Australia mission delegates were fortunate to have Australian Assistant Treasurer Josh Frydenberg join us for drinks ...
    Posted 7 Feb 2015, 21:00 by Peter Black
  • Being prepared to do business in China After making the decision and commitment in October 2014 to participate in the Invest in Australia Mission in Hong Kong and China from 17-23 January 2015, including the Asian ...
    Posted 7 Feb 2015, 21:02 by Peter Black
Showing posts 1 - 9 of 9. View more »


Seeking flow of funds to/from China

posted 9 Feb 2015, 20:12 by Peter Black   [ updated 9 Feb 2015, 20:19 ]

One of the opportunities available to delegates to the Asian Financial Forum in Hong Kong on 20 January 2015 was to participate in a "Deal Flow" or business matching session either arranged by the conference organisers or independently between participants.  

The matching was done off the back of a delegate profile completed well before the conference where your needs could be articulated - seeking to invest debt or equity, seeking the investment of debt or equity or being a service intermediary (accountant, investment banker, lawyer etc) to assist in such transactions.

There was also the opportunity to pitch/present ideas and proposals to delegates who wished to participate and I have included a selection of photos of how these interactions looked.

  
Whilst I did not directly participate in the Deal Flow sessions, I took a keen interest in the process and subsequently talked with a number of my fellow delegates as to their experience.

Based upon my own observations and the various discussions, I drew the following conclusions insofar as to the considerations underpinning possible deals:

      • Significant Investor Visa - the Australian Significant Investor Visa is quite an attractive drawcard for Chinese investors provided they have a minimum of $AUD 5 million to invest and are prepared to invest for at least 4 years.  However, if the primary motivation of the investor is to obtain the visa , and not the potential return on investment, the Chinese investor may choose to just invest in the bare minimum complying investments and not take a stake in a private business (Complying investments include state or Territory government bonds, managed funds regulated by the Australian Securities and Investment Commission (ASIC) and/or direct investment into Australian companies not listed on a stock exchange where that company operates a qualifying business.)
      • Employment sponsorship - a number of delegates who thought they were being introduced to potential investment partners in fact had resumes presented by local Chinese keen to secure an employer sponsored visa into Australia.  This obviously requires a definite employment need in Australia and meeting the various Australian visa restrictions
      • Ownership of businesses or property - we were advised that Chinese often prefer to own outright a business or property for both control and status purposes - and therefore, a passive investment (debt or equity) may not be as desired, unless it is designed to ensure food or resource supply security
      • The importance of relationships, status and "face" - an earlier post on "Inside the Chinese Mind" covered the various concepts that are important  in undertaking business with the Chinese people.  An Australian expectation  of a "quick deal" off the back of one meeting is likely to be unrealistic as is the securing of a passive investment - unless one or more of these criteria can be met.  
The conclusion on all this was that there are significant opportunities to do deals between Australia and China but needs to recognise the various unique cultural and legislative requirements of each country - and requires patience, relationships and as with any deal between any two parties, a win-win approach.

As the China-Australia Free Trade Agreement in implemented and then use, we will hopefully see more such deals although the agreement will only provide a framework and guidelines.

PB

Copyright: Peter Black 2015

Inside the Chinese Mind

posted 7 Feb 2015, 21:06 by Peter Black   [ updated 8 Feb 2015, 16:49 ]

I had the benefit on the Invest in Australia Mission of being introduced to Geoff Baker, originally an Australian lawyer and investment banker, who co-authored with his Chinese born wife, Helen Zhang (both pictured below onwith IIA tour leaders Caroline Hong and David Thomas) , a book titled "Inside the Chinese Mind: A Guide on How the Chinese Think".

For anyone doing business, working with or sharing experiences with people originally from China, I highly recommend this book as an essential, well laid out and easy to read fast track guide to start to understand the many centuries of influences on the current culture which has shaped the Chinese people.

Some key concepts which are covered in the book, with the Chinese terms well described, include:
  • The Five Core Elements of Chinese Thinking
    1. Language that Shapes the Mind
    2. Yin and Yang
    3. Chinese Connectedness
    4. Midstream Living
    5. Face "mianzi" - More Important than Life Itself
  • The different types of Enterprises in China - State, Private and Foreign
  • The difference between leaders and decision makers
  • The work ethics of the different generations - with particular emphasis on some changes coming through with Generation Y
  • Communication and relationships in China - including "guanxi", what "Yes" actually means and the various "Circles of Influence"
  • Both the Big Things and the Little Things that matter
  • How the Rule of Law works and how agreements and conflict are actually handled.

(Geoff Baker, Helen Zhang, Caroline Hong, David Thomas)

PB

Copyright: Peter Black 2015

Audience with Nobel Laureate economist Paul Krugman

posted 25 Jan 2015, 17:35 by Peter Black   [ updated 7 Feb 2015, 17:16 ]

The keynote luncheon speaker at the Asian Financial Forum on Tuesday 20 January 2015 in Hong Kong was Nobel Prize winning economist and New York Times columnist Professor Paul Krugman, and what a privilege to be in the audience.  

He delivered a wide ranging speech covering China, India, the US, Europe, demographics, oil - but not Africa for which he claims not having specialist knowledge although acknowledged its future importance. Amongst the points he made during this speech were:

  • There are 3 Ds that got countries and regions into trouble - Deleveraging, Demographies and Dogma
  • Amazing that in the last 6 years policy makers around the world have worried about the wrong things
  • China scares him - because of the scale of adjustment required to move from an investment led to a consumption led economy and the unfavorable demographics are very much like Japan
  • Europe is not in a good state - economically and geopolitical - "it is Japan without the social cohesion"
  • the US economic recovery looks good amongst wealthy countries, but it is transient
  • India is better positioned than China for future growth
  • Coal is more important than oil
  • the global politics is changing on climate change
A summary of Professor Krugman's thoughts are in this accompanying interview and is worth just under 6 minutes of your time.

Paul Krugman at Asian Financial Forum January 2015


So, if he was the only person I saw in Hong Kong, the whole trip would have been worthwhile!

PB

Copyright: Peter Black 2015 @PeterBlackCoach

Running your business in China in Google Apps - NOT!

posted 24 Jan 2015, 15:59 by Peter Black   [ updated 7 Feb 2015, 17:18 ]

Before going into China, I had been vaguely aware that the Chinese government had blocked Google access but had not really paid any attention to it as I did not currently do business there - either on the ground or with Chinese individuals and firms. The relevance of this to me is that I run much my my business through Google Apps - which means this website is written in Google Sites, my calendar is Google Calendar, my contacts are Google Contacts, my email platform is Gmail and I store my documents through Google Drive.

I spent 5 nights in Hong Kong before travelling by train into Guangzhou, and had full access both at the hotel and at the Asian Financial Forum through Wi-Fi.  My back up was to turn on Mobile Data on my phone (I had not bought a Telstra data pack before leaving thinking I would be around Wi-Fi most of the time). Whilst Hong Kong has since 1997 has been a Special Administrative Territory of China, it is still regarded and operated separately similar to the way it operated when controlled by the British which means that it has all the legal conventions and protocols expected in a Westernised country - including access to Google Apps - until at least 2047 under the One Country, Two Systems principle.

Upon arriving in Guangzhou and being hosted for the day by a local firm,  we were kindly provided with very generous hospitality and access to Wi-Fi in their office. However, I quickly discovered I was not able to access any of my aforementioned Google Apps though here.    My only means of access was to turn on my mobile data on my phone which I had on international roaming through Telstra.  So am thinking that I am offline with my business for the 2 days I am in China although I was able to access sites such as the Australian Financial Review and Sydney Morning Herald.

But not to worry said the tour leader - "you can access Google through the VPN (Virtual Private Network) of the Hilton Hotel in Guangzhou".  And that was the case with email, website update and I was also able to undertake a 45 minute Google Hangout with the family back in Australia.  

In case you don't know what a VPN is, this article and diagram assist in understanding how this works - so in my case, I was effectively accessing the wider internet through the Hilton Hotel's global servers located outside China [I am the remote user in this diagram, Hilton's global servers are in Head Office and the Hilton Guangzhou is Regional Office]. [UPDATE 25/1/2015:  The Chinese government now appears to be now further restricting access through VPNs - see this Forbes Article].

Whilst I had internet access, I then out of interest Googled how many other websites are banned in China - and found there are over 2700 such banned websites, including Dropbox, Google, Twitter, Vimeo, Yahoo and YouTube.  

From a practical perspective, I then concluded that I could access my business provided I had Telstra Mobile data and/or a VPN connection [ although as at 25 January 2015, the VPN access may not be available per Forbes Article above] 

However, what about the people in China to whom I was providing business cards as shown here with all my contact details including my website, email, Google+ and Twitter details thereon - in both English and Mandarin?  These details were also all over my marketing collateral.

I then talked further with various people both on the Invest in Australia mission and at Australian Chamber of Commerce networking drinks and it appeared that there are two main applications in use in China (presumably all fully monitored by the Chinese Government and I respect their right to do that even if I may not agree with it - remember we are having similar debates in Australia about metadata access) being Tencent QQ for desktop/computer, WeChat for mobile use and Weibo as a Facebook/Twitter substitute. 

My conclusion upon appreciating the implications of all this was that I would need to reconsider my overall branding and connection strategy if I am to undertake business in China or with Chinese firms - and this is before I consider the translation of marketing collateral and websites etc.  So, if your business is in the process of transferring to cloud computing through Google Apps, this implication needs to be borne in mind.

I also concluded that the security in Google must be very good as the Chinese Government can't appear to access access it - which may be a comfort and good risk management outcome.

All in all - another very interesting series of lessons in doing business in China!

Copyright: Peter Black 2015 @PeterBlackCoach

Importance of Chinese personal and business names

posted 24 Jan 2015, 10:44 by Peter Black   [ updated 9 Feb 2015, 20:37 ]

I mentioned in my earlier post "Being prepared to do business in China" about the development of appropriate personal and business names to conduct business in China. The process behind this is worthwhile sharing.

Fortunately, I had been referred to someone who was experienced in understanding the nuances of this process, Greg Mikkelsen of 3 Mandarins in Sydney, who has also has a range of consultants on his team with experience in difference parts of China and was presented with a range of options for both my personal Chinese name and my Chinese business name.  I have extracted the relevant sections of 3 Mandarins' advice below as it reflects the development process behind the names, which was based upon both discussions with me and their review of my website and other marketing collateral developed for the Invest in Australia mission.

Personal Chinese name - 2 options were presented as below and I went with 3 Mandarins recommendation of Option #2:


Chinese Business name - So, having decided on the personal Chinese name, it was then to decide on the Chinese business name and, given that I personally am effectively my own business, it was decided there had to be some connection between the two as you can see in the advice below:



One these were decided, Greg then helped me develop appropriate 2 sided business cards with the outcome being shown as below, which interestingly, received great feedback from Chinese people to whom I was introduced on the mission - so thanks Greg and team, you did well!



Bottom line - this is an important part of the process and the importance of good advice cannot be emphasised enough.  In this regard, I highly recommend and sincerely thank Greg and his team at 3 Mandarins for their insights, experience and professionalism.

PB

Copyright: Peter Black 2015 @PeterBlackCoach

Dealing with the CIA in Asia

posted 20 Jan 2015, 23:06 by Peter Black   [ updated 7 Feb 2015, 20:43 ]

ASEAN countries
Before the Central Intelligence Agency from the US gets worried, I have "hijacked" the acronym CIA to represent what I have concluded is the significant market opportunity sitting to the north and north-west of Australia.  The opportunity has a potential ROI of 150 times!

I only became aware of the importance of this when attending a China investment session at the Asian Financial Forum where the representatives from China indicated one of their major market opportunities is the ASEAN region.

Having not looked at this for a while, upon researching ASEAN through Wikipedia I realised that it is 10 countries between China and Australia with a combined population of 600 million people (pictured). Then, as I am sitting in this session, the International Monetary Fund (IMF) released its World Economic Outlook, with one of the implications being that India appears to have more growth opportunities than China.

So, what we have is what I am terming the "CIA" region:
  • hina with 1.4 billion people; 
  • I ndia with 1.0 billion people; and
  • A sean region with 0.6 billion people
So, we have these  developing markets of approximately 3.0 billion people immediately within our region - over 40% of the world's population - who want to catch up and grow quickly.  Australia, whilst being a minnow in terms of a population of approximately 23 million people, has an abundance of resources needed for development.  And there are approximately 150 times more population than Australia requiring our resources - tangible as well as services and technology.

The question therefore is what are we doing to leverage this opportunity?  

PB

Copyright: Peter Black 2015 @PeterBlackCoach




China and Hong Kong centre of the world

posted 18 Jan 2015, 23:31 by Peter Black   [ updated 7 Feb 2015, 20:46 ]

I hadn't appreciated until reading the Business tips on the Qantas inflight system on the trip to Hong Kong that China actually means "Central Nation" - which has its origins long ago when China dominated trade.

A few years ago, I also had read a book called "When China Rules the World" which made the case that China has, with the exception of the 100 years from 1850 to 1950, essentially dominated/had huge influence in the world because of its population and influence on global trade.  When one appreciates that China and the USA are now the G2, have cooperated on climate change agreements and recognise the importance of co-existing peacefully, the centre of influence has certainly reverted.

Furthermore, the endemic problems in Europe, including its aging demographics and unsustainable social welfare expenditure, also tilt the balance back to the AsiaPac region.  Add in the growth if India, with its population, and it makes sense for Australia and its people to re-orient (excuse the pun) towards this region and this is evidenced by the recent completion of Free Trade Agreements with China, Japan and South Korea, with India in process.

Hong Kong, whilst now a Special Administrative Territory of China, in 2014 had the second largest IPO issuance and is still "open for business".  I saw a tweet at the AFF that said that to list a public company in Hong Kong now only requires 7 steps - down from a previous 23.

So, it does appear that China and Hong Kong is more looking like the centre of the world. We in Australia need to understand this and develop new skills and business behaviours to leverage our opportunities given our proximity and resources.   

It certainly appears to be a case of Back to the Future!

PB

Copyright: Peter Black 2015 @PeterBlackCoach

Australia open for business

posted 18 Jan 2015, 07:26 by Peter Black   [ updated 7 Feb 2015, 21:00 ]

As  a prelude to the Asian Financial Forum in Kong Kong, the Invest in Australia mission delegates were fortunate to have Australian Assistant Treasurer Josh Frydenberg join us for drinks at the Hong Kong Club on Sunday 18 January 2015.  The Assistant Treasurer is participating in the forum for the next 2 days before attending the Davos Economic Forum in Switzerland (hope he has some extra francs!) and then meeting with various regulators in London.

Key points from his presentation to the mission were:

  • Australia has had 23 years on economic growth.  The expectation is that this will continue for at least another decade.
  • In addition to the conclusion of Free Trade Agreements with China, Japan and South Korea, there is an expectation that a FTA will be signed also with India later this year.
  • The government recognises the importance of tax reform and the removal of red and green tape to make it easier to do business.
  • Australia's $1.8 trillion and growing superannuation savings recognise a large source of potential capital and emphasise Australia's opportunity as a financial services hub.
  • The government is keen to receive good ideas on how the challenges may be addressed as this is a collaborative partnership.
We appreciated the Assistant Treasurer's time in a busy schedule  and look forward to hearing him speak at the Asian Financial forum.

PB

Copyright: Peter Black 2015 @PeterBlackCoach

Being prepared to do business in China

posted 18 Jan 2015, 00:43 by Peter Black   [ updated 7 Feb 2015, 21:02 ]


After making the decision and commitment in October 2014 to participate in the Invest in Australia Mission in Hong Kong and China from 17-23 January 2015, including the Asian Financial Forum on 19-20 January, which was based upon my desire to learn more about this fast growing region as articulated here, it was then understanding what is involved from a branding and marketing perspective.

Fortunately, I had the advantage by being guided by David Thomas and Jennifer Catterson of Think Global Consulting, both of whom have huge experience in this region, and it highlighted the importance of not being a typical Australian with a "she will be right, mate " attitude.  David has lived and worked in this region for over 30 years notwithstanding he is now based in Sydney, Australia and Jennifer, despite her young age, already has 15 years experience with the language and culture even though she has being living in Australia

There were 3 key aspects that I needed to consider:

  1. What were my purposes and objectives of participating in this mission?
  2. What branding and marketing collateral would I need?
  3. What Chinese name did I want for me and my business? 
My objectives were to basically commence my on the ground learning and knowledge accumulation of doing business in Asia having spent my whole career in various roles in Australia.  I recognised my development needs and this was going to be a somewhat fast track and experiential way of enhancing my knowledge.

The branding and marketing collateral was to develop a one page (or two when allowing for a Mandarin translation) marketing flyer and to have a bilingual business card. This section of my website was then also added and it was then targeting my social media posts towards the Asian Financial Forum.

However, the above also required the development of Chinese personal and business names -and the translation of my marketing collateral.  Fortunately, David and Jennifer were able to refer me to Greg Mikkelsen of 3Mandarins in Sydney who is well experienced in undertaking this professional work.  Greg and his team were terrific in both interviewing me as well as reviewing both my English version marketing flyer and personal profile, as well as my website, to develop appropriate personal and business names and translate the required collateral.  A sample of the output is below with a two sided bilingual business card.




So, this has all been done.  Now for the Asian Financial Forum and the Mission itself!

PB

Copyright: Peter Black 2015 @PeterBlackCoach 

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