Two major factors contribute to the interest in the Asia Pacific, broadly defined as Asia, Australia and New Zealand, from business people every where. First, the region will likely account for half the sales growth, over the next decade, in virtually any industry from cars to power stations. According to the World Bank, in the decade prior to 1994, Thailand (with 8.2% average annual growth) constituted the fastest growing economy in the world, followed by South Korea (7.8% average growth), China and Singapore (both 6.9% average growth). Second, the Asia Pacific is experiencing a Darwinian struggle between different forms of capitalism, some of which have only just begun to venture outside their home. Two of the main protagonists, Western and Japanese multinational corporations (MNCs), display well-studied and relatively well-understood competitive behaviors. The third, the bamboo network of Overseas Chinese family businesses, has less familiarity for Western managers and researchers: consequently, it causes both fascination and fear. Similarly, local governments that aggressively promote regionalization present yet another of the less-understood main protagonists: Asian governments have been portrayed as catalysts of the Asian miracle and conversely also as purveyors of bubble economies by economists such as Paul Krugman and Alwyn Young.

The Asia Pacific overwhelms with its variety and forms a very difficult place to classify. Recently, popular writers have made fashionable the simplistic view of the Asia Pacific as the manifestation of the Overseas Chinese network -- the 50 million people of ethnic Chinese descent that often dominate local economies. Popular writers have exemplified this view in books such as Megatrends (by John Naisbitt) and Lords of the Rim (by Sterling Seagrave). Some writers have also employed the term Greater China to describe Mainland China and the surrounding economies dominated, either economically or in actual numbers, by ethnic Chinese. This term implies that the Asia Pacific economies share common characteristics revolving around Chinese values, connections and business practices. But, this view often proves misleading and racist. The individual Asia Pacific economies display nuances that often have no relation to China or ethnic Chinese. Also, the Greater China view implies that ethnic Chinese in the Asia Pacific economies may follow Beijing's bidding; or, coordinate their interests, rather than subscribe to individual, often simple, economic equations. Yet, such views fail to explain China's failure to influence Taiwan's recent presidential elections; or, Singapore's failure to temper recent Sino-US disputes on patent protection. Several other myths abound of the Overseas Chinese, their styles of management and their influence on the Asia Pacific economies. This issue, and its sequel, will try to dispel some of the myths, and suggest other, more fruitful areas of inquiry. More importantly, the articles in this issue will attempt to elicit the individual Asia Pacific economies' local flavors for investors in the region. In this fashion, this special issue hopes to aid in interpreting business environments in the Asia Pacific.

All the articles in this issue have strong theoretical bases; yet, all the articles address complex issues in manners that general audiences will find accessible. The authors, acknowledged experts in their areas, explicitly tackle topics that investors in the region may find interesting -- innovation by MNCs' subsidiaries, data for strategic decision-making, financial restructuring, governmental control over business environments, business ethics and values, regionalization efforts by local governments, and political risk. Mike Hobday spotlights the competitive problems and opportunities around technological innovation by MNCs' subsidiaries in Malaysia. George Haley and Chin-Tiong Tan survey the lack of data in the Asia Pacific to make strategic, market-related decisions, and propose solutions for MNCs' top decision makers. Tony Saunders and Ingo Walter apply lessons on universal banking from the largest financial market in the world, the USA, to the ambitious and restructuring, financial markets in the region. My co-authors and I elaborate on the metaphor Singapore Incorporated, subsequently used by the government to market itself in the region, to address Singapore's government-led development, and the government's design of regional business environments. Kam-hon Lee makes a case for Chinese ethics and values, so different from Western concepts that numerous surveys have classified China as the most corrupt country in the world. Ian Marsh addresses the regionalization drive of another major regional power, Australia, highlights opportunities for doing business in the country, as well as the startling lack of professionally-trained managers that understand the region. Andre Everett discusses New Zealand's business environments and its turn-around strategy. And finally, Lew Howell and Donald Xie address problems with predictions of regional political risk and propose strategies for reducing errors. As Guest Editor, it gives me great pleasure to present this special issue on Strategic Management in the Asia Pacific.

Dr. Usha C. V. Haley
Singapore
June 1996