I’ve been feeling a little worried about job security lately. I am the global business columnist for the world’s most global business publication. I have immigrant parents, two passports, and have lived and worked in many countries. I’m all about crossing borders. And yet, I find myself questioning the logic of unfettered free trade and globalised business more and more frequently, particularly when it comes to China.
No, this doesn' t mean I' m pro-Trump or pro-trade war. But the president is right that China has changed the game, and we have to acknowledge this. While many of us stopped believing the “China will get freer as it gets richer” line years ago, I’ve been amazed how many international business people have continued to live in a state of wilful blindness about the political risks inherent in doing business there. Several years ago, for example, I interviewed the chief executive of a large European wind power company. At the time, the firm was number one in its category in China. I asked the CEO how he thought he would do in the market over the next year or two, and he said: “I think we’ll do all right — we’re expecting to be number four in the category.” I was stunned. “Number four? Why do you think that?” Because, he said, that’s what Beijing had told him.
Why did anyone ever think it would be different? For the last several years, there has been a move towards more, not less, state control in China. Particularly in the wake of the 2008 crisis, the Communist Party began openly (and understandably) questioning the basic tenets of neoliberalism and financial capitalism. And yet, even as American and European companies have felt the shifting sands, they’ve hedged their bets and tried to play both sides of the field, complaining to officials about intellectual property theft by the Chinese while refusing to sign their name to public complaints that the US government wanted to lodge about such behaviour at the World Trade Organization. The possibility of getting just a sliver of a 1.4bn consumer market, even for a short period, was just too tantalising. Quarterly results, not long-term concerns and certainly not strategic or geopolitical worries, would rule the day.