Sir, - I am glad to see the new ABT chief executive, Oliver Tattan, has been assessing the Chinese market, before the board's opening of another office there. Our experience of the market, however, over a ten year period, indicates quite a different scenario from that painted by Mr Tattan.
China, as we and many of our associate companies have found, is much more corrupt and difficult to trade in than Latin and South America. To suggest otherwise is not consistent with the reality of day to day trading in these areas.
Besides the obvious difficulties of trading in China, such as the language and distance to the market, there is a very different business culture to that found in Europe, Africa, the US and South America. Commercial contracts in China do not carry the same importance or confidentiality as is common in most other markets. Technical confidentiality or patents are particularly vulnerable in this market. The cultural blind spot may be partially explained by the fact that there is no equivalent in the Chinese language for the word "private".
A local agent is essential to almost any type of business, and the slush fund is ever prevalent. The latter is almost a way of life and is found in all circles.
China is negotiating for membership of the WTO. One of the major issues is the protection of intellectual property - a source of constant complaint by software exporters from the US in particular. So the first issue is the rules of the game which many companies have found, to their cost, are not respected, and exporters are advised to tread warily. The second is information on market prospects, market entry and development strategies and on the pitfalls in this rapidly changing environment, which hopefully the new Bord Trachtala office will provide.
It is good to see Mr Tattan taking a positive approach but the interview, as reported in your business columns last Friday, definitely minimises the problems which business would find in developing markets there. It is important for the board to give realistic advice, and not to overlook the obvious pitfalls. - Yours, etc.,
President,
Irish Exporters' Association,
Holbrook House, Holles Street,
Dublin 2.