Chinese coming to the USA: why are we here?

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Every week on Travel Talk Radio and Business Travel Radio Sandy Duyvetter speakers to different industry specialists to discuss the current trends. Recently she interviewed TCBN’s own Janet Carmosky to talk about China’s rising world position and what that means for the receiving end, American businesses, and for Chinese tourists in the US.


SANDY DUYVETTER: Welcome back to Business Travel Radio. My name is Sandy Duyvetter and I want to thank you all for joining us. If you to there you’ll see our programming, and today’s program is filled with information. We’re going to China today. We have not been in China for a long time physically, and we’ve not talked about China for a considerable amount of time. I certainly believe it’s the right time to bring China back into our scope.

With us we have a very professional and an expert in the industry. Her name is Janet Carmosky. She is the CEO and Editor-in-Chief of The China Business Network. She’s been in business doing this particular business since 2008 but she has a long history of understanding Chinese business and how westerners will work and be successful in that market – in all of those markets. Thank you so much for joining us.

JANET CARMOSKY: Thanks for that great introduction, Sandy, and thanks for having me on the show.

SD: You bet! We’ve been following you for years, as you and I have been talking offline. I got really excited when I saw your last newsletter, and I thought this is the time I really got to get you back in front of our audiences. I believe I need you have you tell us the facts. You certainly are the expert. In our minds it certainly seems as if we were gung ho to get into China especially as our industry would dictate in tourism and travel. But of course with this major recession happening we’ve kind of stood back and took a looks. But I do feel as if there’s a lot of things pointing to opening more doors in China now. Are you feeling the same way? Or are we out of whack here?

JC: No I do. I do feel that there’s a shift in the relationship between the business communities of the US and China, that for the past few years in the global recession and with China’s continued pursuit of their economic growth with all of the restructuring that had to take place in the US, there’s been a kind of confusion about what is this relationship about? If it’s no longer about American businesses investing in China and running export oriented businesses, and if it’s no longer about the Chinese always coming to America to sell China only as an investment destination, now there’s a shift to the Chinese coming to America to look at the US for their own investment. Chinese brands trying to set up – it’s been kind of a reversal or at least a multidirectionality emerging in the relationship between the US and China.

It’s had a lot of people confused as the US has gone from having surpluses of cash and strategic interest in expanding and growth. There’s just not the ability to invest in new initiatives on the part of new American enterprises that there was a couple of years ago. I feel now that as the dust is sort of settling and the Chinese are coming to a clearer sense of what the US is for in terms of reaching their own national and enterprise level objectives. And the US is likewise coming to a new understanding of what China is for, what role that country plays in our continued economic health. The excitement is real. We’re starting to get a new definition of what we can do for each other.

SD: Absolutely. And I think you bring up a really interesting point because from our end we’ve always looked at going to China. Bringing it to China. Bringing that western mark to China. But as you’re pointing out, China’s coming to the west also. And I don’t know if all of us realize that opportunity too. Do you want to play on that one a little bit for us?

JC: Sure. I blog on Forbes sometimes, and the reason I bring this us is because I’m just about to post – if you’re a subscriber or a member of The China Business Network you get a newsletter, and the title of the last column I sent out last week was “Swagger Isn’t Sustainable.” I’ve done some more research and I’m going to post an article based on that on my Forbes column.

The concept that I want to talk about is how a few decades ago I spent my life living and working in China and explaining to American business executives. The very senior executives would come to China and they would say “what does Shanghai want to be? Does Shanghai want to be London when it grows up? Does Shanghai want to be New York? Does Shanghai want to be Paris?” I thought it was a ridiculous question – Shanghai just wants to be Shanghai. There was a view that China was kind of an afterthought: it’s nice to have but it’s kind of a backwater and it doesn’t really matter what we do here or do nothing at all. I think it took an amazingly long time for American business, which has always been so busy just being an American business, really. We have a large continent, largest market in the world, there’s plenty to do just to make money and thrive in North American. And there was this tendency to look at China and say “maybe we will and maybe we won’t.”

I’m not having that kind of same conversation with the Chinese when they come to the US. Interestingly enough, the Chinese have all the money and power and think, we’ve got enough going on in China and we can do business in countries that roll out the red carpet for us – like the European nations where they’ve always had industrial policies so they treat us really well and give us great subsidies and treatment. We can go to the Middle East or Central Asia, where the heads of state acknowledge they need China and Chinese money and technology. They need China in their country for security purposes. And the Chinese come to the US and we say “maybe, maybe not.”

As I believe now and 30, 20, 10 and 5 years ago, China should not be and can’t afford to be an afterthought for western business. Similarly, I don’t think the Chinese are correct to the extent that they view America as something they don’t really have anything to gain by dealing with. They are beginning to reconcile the deeper truth, which is that America is the source of innovation, ideas, creativity, commercialization of things that change the way people live their lives. And that’s something that China really doesn’t do very well. They do really quite need to continue to be in relationships with us, but we’re dealing – the point I’m making is we’re in a realm where China and the US have to exchange a lot of ideas and skills, people, and platforms. It’s not just about goods for money right now. Goods for money which was Chinese goods going in for American money is not really the thing anymore. It’s more ideas going back and forth, and people going back and forth.

SD: We’re going to go back and forth here again and take a quick break. We’re going to keep Janet on with us and continue talking about The China Business Network. Of course you can go to The China Business Network web site.

(commercial break)

SD: Welcome back to Business Travel Radio. We are enjoying a marvelous conversation with Janet Carmosky. She is the CEO and Editor-in-Chief for The China Business Network. You know, Janet, I feel like I’m relearning China. As you’re saying, they’re probably learning about us too, as you remarked earlier. The fact that we know there are so many interested Chinese tourists coming to the US, it’s a remarkable time. But we also know that the Chinese tourists are looking for maybe something different, even in hotels, than what westerns are. Is that something – I know you’re not necessarily a travel industry expert – but can you see that there are many things we need to learn about each other to do business?

JC: Yeah. I would say there’s a lot we can learn about the Chinese. First of all, the United States of America remains the top aspirational destination. It’s a place the Chinese still want to come to. It’s that whole idea of “if you can make it here you can make it anywhere.” Regardless of how successful the Chinese are, they’re still quite aware of the USA as being a source of great power and great ideas and great wealth. So they definitely want to come here. What they’re looking for when they come here is something that we’re just starting to be able to listen to a little better and zoom in on.

For the leisure market, Chinese arrivals in the US have come up 54% since the Chinese and the US signed this memorandum of understanding to allow Chinese leisure groups to come to the US in 2008. It’s now almost a $4 billion market of Chinese tourists in the west.

SD: It’s interesting. I even saw some figures saying it was going to go to 200%. That’s how much the Chinese do want to come to the US, which is really remarkable and exciting for us who do these cultural exchanges, and understand each other. So that’s really great news.

JC: It is really great news! And what makes it real and what makes it start to happen more, I feel like this is going to be a bottom-up kind of effort that travel destinations in the United States need to work. Regionally, we have to get states and destinations and government on board to really market to the Chinese. If you think about how when … I lived in China for almost 20 years and I can read, write and speak Chinese just fine. I can read Chinese all day. But when I’m in China and my eye is looking around my environment, I’m still going to zoom in on anything in English, first and foremost. Similarly I’ve noticed in the US we’re just starting to get to the point where there’s Chinese signage at JFK Airport.

What we hear, often when I’m working with tourism industry officials, the Chinese who come to the US will have interpreters or read English so it’s not a big deal. But it really is. It’s symbolic of our willingness to acknowledge them and meet them a little more than halfway and say “we’re glad you’re here.” I think just coming out of our denial that we don’t need to do that and it doesn’t matter or make a difference, that’s half the battle.

SD: I will say, going to China – I’ve had the opportunity to be there six times – I’ve always enjoyed the fact that it is so different, and that English is so really hard to find. When you really compare to other countries and other emerging countries in tourism, it’s exciting to be out there and totally emerged in a culture that’s so incredibly different. And of course that’s the adventure traveler in myself. But as a business traveler, there are a lot of times you are going to be the first westerners in an area where you’re building structures of foundations for whatever’s going to happen later. Do you see that we’re going to be coming closer to this? Do you see in five years that we’re going to have a remarkable relationship? Or are we still going to be struggling with “who are we?”

JC: No, I think in five years we’re going to have a remarkable relationship. I think all of the puzzle pieces are either already there and just haven’t been put together, or they can come together. It sounds simple to say. I know how much work has to be done by private sector to get that to happen. For example, when a Chinese business delegation comes through, they’re here to make something happen.

Put yourself in their shoes – you’ve been a business traveler. You want to feel a little confident, not lost. You don’t want to feel clueless. So think about how when you’re in Madrid or Paris and you go back to your hotel room when it’s time to end the day, you put on an English TV station just to feel a little more grounded, and how comforting that is. There are Chinese language broadcasting services in the US now. If you’re a hotel and you want Chinese guests, find the Chinese language broadcasting and newspapers in your area. It’s something they’re really going to respond to.

SD: I think we’re sort of blessed here in San Francisco where we feel very much the Chinese are certainly our neighbors and our cultures are becoming more and more entwined. It’s very exciting here in northern California. I can see how the rest of the country might not feel as comfortable, not having the Chinese visitors coming in and feeling that comfort. Certainly San Francisco is ready for that. Do you see that there’s one industry more than another that is really got a great opportunity in China?

JC: I think there’s a lot of opportunity in a lot of sectors. I think the Chinese drive their economy top-down with the Five Year Plan. What the Five Year Plan is about right now is about service sectors – business to business services, things that America’s quite good at (brokerage, insurance brokerage, payroll outsourcing, management of clinics or facilities, healthcare). The 12th Five Year Plan is about business to business services, moving into higher value added service markets like financial services and healthcare; and of course renewable energy, cleantech, environmental remediation – these are all critical imperatives for the Chinese to keep their country not just growing, but, bluntly, from falling apart. They’ve been growing at breakneck speed.

I want to throw in there that is an online trade publication and community of people who’ve spent time developing their China competency. For those who are listening who are in a particular area and who are interesting in working with China, find yourself a local guide, a cultural informant. Personally, aside from running The China Business Network, I find myself called a lot when a city has a delegation of people coming through, or they want a delegation to come to their town and they ask what to do. Find somebody who’s done time in China and knows a little bit about what makes Chinese comfortable and happy. These people are everywhere! They’re all over. So go into the Directory and look around and you’ll find help.

So there’s this cultural facilitation. There’s also the sector orientation, cleantech, healthcare services.

SD: I want to say too and mention you talked about some of the opportunities. We also get a lot of calls from Chinese interested parties who want to know more about western hotel management. There’s really great stuff going on there. I do want to make the remark that has some great resources. If you’re interested in getting into China, you can get information there. Janet, I really want to thank you very much for your time today. You’ve really enlightened us, given us a lot of hope for some great growth in China, and of course great cultural exchange. Thank you so much for joining us.

JC: Thank you for all you do for the travel business community. Thanks for having me on.

SD: Thanks. Have a great week.

Original interview aired April 3. Listen to the full show’s podcast here. Republished with permission.

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Editor in chief is Linda Hohnholz.