Do consumers in the more cosmopolitan cities such as Shanghai, Beijing, Guangzhou and Shengzhen behave similary to those in other large cities in the world?

The recent experience of De Beers and Giordano might give you some hints:

Giordano, the major casual garment chain store has discovered that the color preference of Chinese consumers is far different from consumers in Hong Kong. In comparison to the more quiet and subtle color and design in used in Hong Kong, Giordano found that Chinese consumers preferred more colorful and "distinctive" designs.

De Beers, which has used the slogan "A Diamond is Forever" since 1938, appealing to comsumers to consider diamonds as a required gift of love for engagements and weddings of millions around the world stumbled in China. Here are some of the typical Chinese reactions to "diamonds" that De Beers discovered:

While 80% of all gem-quality diamonds sold in the West were purchased as gift, 58% of similar diamonds sold in Shanghai were bought by married women buying for themselves and their spouse as a symbol of status. De Beers has found it especially delicate to try to establish its product into a culture that already has 5000 years history.

A McKinsey presentation at the Harvard Business School Alumni's 1997 Conference in Hong Kong stated that "China is a huge opportunity to fail..." This is especially true for those who attempt to make profit out of this mythical market without thorough market research. Chinese consumers have purchasing power, they enjoy new things. But, many times, Chinese consumers relate to products and services in a very different way than Western consumers for example. I would recommend serious marketing researches by professional firms with plenty of experience in China to examine Chinese consumer behaviour in relation to the product class you may be introducing into this market. Attempting to survey China market the way NASA survey the Mars or the Jupiter is simply insufficient to assure a market success in China.

Will the Chinese currency, the Remimbi, be devalued in the near future?

I have received this question continually since 1996. My answer has always been "Absolutely, no way!"

My answer now is that maybe it is going to be the U.S. dollar that will need to be devalued due to huge trade and government spending deficits. As for the RMB - not within the foreseeable future...

China's economy has consistently been the fastest growing in the world for two decades. With the consistent trade surplus, steadily growing domestic market, and the second largest foreign currency reserves in the world, if China devalued the RMB, what would happen to the rest of the world? Southeast Asia will be dead many times over and the American supermarkets will be so flooded with Chinese products that there would be more people protesting at Capitol Hill than queueing at the check out counters at supermarkets.

How does China's entry into the WTO (World Trade Organization) and its hosting of APEC 2001 affect China's economy, foreign investment and foreign products in China?

China's entry into the WTO has come after 14 years of work and has been expected for years. Thus, it should come as no surprise to anyone. In fact, those 14 years of waiting have given the Chinese government and its economy a very worthwhile time for strengthening themselves in order to reap more benefit from WTO membership. Significant to note was President Jiang Zemin's excellent English in several of his speeches to participants and leaders at APEC 2001. It all symbolizes the seriousness of this most populous nation of the world in preparing themselves for this globalized world.

By shutting down inefficient and outdated factories and putting tens of millions of workers off, largely self-struggling to survive, the leader of this country has demonstrated their determination and great courage. As I wrote in Modernization in the Dragon Land, many of those former state enterprise workers, in a few years on minimal unemployment welfare, have transformed into the most devoted, efficient workers in their new occupations after skills retraining. The 1-3 years on the unemployment rows have changed these millions far better than any other professional training could do in twice the amount of time. Now this group of retrained and ambitious workforce in their late 30's-late 40's have increased the pool of available human resources with desirable characteristics - discipline, honesty, the ability to work hard, and the willingness to learn new skills. I am not sure whether this might have anything to with recent announcement by Bill Gates to move his Microsoft World Headquarters for Software Development to Shanghai.

APEC 2001 has certainly brought a record number of international media, business leaders and government leaders to Shanghai and other Chinese cities during the past 6 months. In particular it the Shanghai APEC 2001 Summit has turned many heads with an exclamation of pleasant disbelief. As China has an even larger task ahead of it, namely the Summer Olympics in 2008, one can be sure that the Chinese government will be very positive with foreign investors and the treatment of foreign companies and foreign products between now and then. My very simple conclusion about the Chinese government is that the leaders are very experienced, knowledgeable, and devoting to the development of China. Thus, with the evidence from the past, I am sure that they will leave no stone unturned to accommodate as much foreign investment and new technology as possible. So, for those looking for the answer on whether or when should they consider China, my answer is: "Don't wait too long, you might be left out!"

Note: For your questions, please note that I am not using the piset@yahoo.com email any longer. My new email is pisett@hotmail.com or granddragon@sina.com

Piset Wattanavitukul
Shanghai, China

Piset Wattanavitukul is Managing Director of P. W. Consultants specializing in Investment, Management and Trade in and with China and Human Resource Development in Shanghai and Ningbo.