NZ-Sino Youth Exchange (New Zealand China Youth Exchange)

Bowen Pan, Kerryn-Ruth Botting, Jack Sheppard, James To and Tien VuBowen Pan, Kerryn-Ruth Botting, Jack Sheppard, James To and Tien Vu

October, 2009October, 2009

The NZ-Sino Youth Exchange 2009The NZ-Sino Youth Exchange 2009

Key LearningKey Learning

© 2009 Bowen Pan, James To, Jack Sheppard, Tien Vu & Kerryn-Ruth Botting2 NZ-Sino Youth Exchange 2009: Key Learning

PrefaceA Message from the New Zealand DelegationThe inaugural New Zealand-Sino Youth Exchange was a complete success! As Asia:NZ Young Leaders, we are delighted to report that the exchange has provided us with new friends, new networks, and new insights into China.

This exchange would not have been possible without the vision and hard work of many key individuals, of whom we would like to thank:

•Firstly, we would like to express special thanks to Madam Li Xiaolin for having the vision of initiating this exchange between the youth of New Zealand and China.

•Secondly, we would like to thank the CPAFFC for their hospitality and generosity throughout the exchange, and for preparing a meaningful schedule of events and activities.

•Thirdly, we would like to give our sincere thanks to our CPAFFC guides, Rose, Lily and Linda Wang for taking such good care of us.

•Finally, We would like to thank the Asia:NZ Foundation for sponsoring our travel to China; to Vanessa Lee and Melanie Crawford for working on the administrative aspects leading up to and after the exchange – in particular organizing our visas, tickets and other essential travel requirements.

During the twelve days and nights of an intensive, yet wonderful itinerary, we were able to sample the best highlights of China’s history, culture, cuisine, economy and future. We learnt about matters important to China's development - such as social concerns, business opportunities, and urban renewal. In response, we shared many of New Zealand's perspectives on these themes.

The exchange was an experience that all of us will treasure for years to come. We eagerly look forward to building upon the bridges between our two countries and to continue deepening our mutual understanding. We hope that through this report, you will have learnt something about China that you previously did not know and have furthered your understanding in the importance of the NZ-Sino relations.

Bowen Pan, James To, Jack Sheppard, Tien Vu and Kerryn-Ruth BottingThe New Zealand Delegation, New Zealand Sino Youth Exchange 2009


Table of ContentsPage 1 of 2

• Business 7

‒ Introduction to Business in China 8

‒ Innovation in China 9

‒ Innovation Case Studies 10

‒ Entrepreneurship in China 11

‒ Site Visits:

• Z-Park Site Visit 11

• Minesage Site Visit 13

• Kami Site Visit 14

• Shanghai Stock Market Site Visit 15

• Shanghai Expo 2010 Site Visit 16

• NZ Central Site Visit 17

• The New Zealand Centre at Peking University 18


Table of ContentsPage 2 of 2

• Urban Development 19

‒ Overview 20

‒ Beijing 22

‒ Xi’an 23

‒ Shanghai 24

‒ Heritage 25

‒ Sustainability 26

• Social Issues 27

‒ Aging Population and Education 28

‒ Urban Migration 29

‒ Ethnic Tensions and Non-Government Organizations 30

• Society and Culture 31

‒ Modern China 32

‒ The “New China” Society 33

• Conclusion: New Zealand and China 36


OverviewBackground• Asia:NZ Foundation in partnership with the Chinese People’s Association for Friendship with Foreign Countries

(CPAFFC) have organised the inaugural New Zealand-Sino Youth Exchange in October 2009. Ms Li Xiaolin, a recently appointed Asia:NZ honorary adviser, is Vice President of this influential institution.

• The exchange’s objective is to develop long term relationships and to establish links and promote communication among future leaders of New Zealand and China. The exchange started on Wednesday 14th October in Beijing and ended on Sunday 25th October in Shanghai.

• Five young leaders were selected by the Asia:NZ Foundation. These young leaders were deemed to have the necessary qualities and skills to contribute to furthering New Zealand-China relations. The five young leaders are:

‒ James To – a PhD student from University of Canterbury based in Christchurch. Primary interest in the relationship of overseas Chinese and the Chinese government. James is fluent in Cantonese and competent in Mandarin Chinese.

‒ Kerryn-Ruth Botting – a public servant currently serving at UN Refugee agency based in Seoul. Significant experience in New Zealand central government agencies. Kerryn-Ruth is fluent in Korean and is competent in Mandarin Chinese.

‒ Jack Sheppard – a Sinophile who has had extensive cultural and work experience in China. Currently based in Wellington. Jack is fluent in Mandarin Chinese.

‒ Tien Vu – an architect based in Wellington. Primary interest in urban development of cities.

‒ Bowen Pan – an entrepreneur and management consultant based in Auckland. Primary interest in the economic and trade relations of New Zealand and China. Bowen is fluent in Mandarin Chinese.

James Jack Tien Kerryn-Ruth

Bowen


OverviewThe Itinerary


Business in ChinaIntroduction• In comparison to most Western corporations Chinese firms are very young and many lack

basic processes and structures, as well as high-level strategy (especially for large state-owned enterprises). However, most private-sector Chinese firms are very nimble and are very quick to adapt to a rapidly changing Chinese Market.

• In general, the large corporations in China are dominated by state owned enterprises (SOE) – with the exception of internet and consumer facing industries. In many cases, these large SOE are denoted by “China” (or similar) in their name. E.g. China Insurance(中国保险 ) and China Mobile(中国移动 ). The core industries are also controlled by the government, such as the energy, telecommunication, transportation, banking and the stock-market.

• There are approximately 100 million private small to medium enterprises (SME) in China. SME is defined as firms with annual revenue of less than ¥100 million (US$15 million). Every ¥10 million represent a significant milestone in a company growth. ‒ Note that the concept of private enterprise was only officially approved after the 17 th National

Congress in 2007 (before this, private enterprises were called “People’s Corporations” and were not given the same legal protection as state owned enterprises).

• Government Regulations are in a constant state of flux. This presents both challenges and opportunities to businesses as entire markets can be opened up or shut down in a short period of time.

• Chinese firms are increasingly focusing on innovation and R&D rather than cheap manufacturing. This is largely driven by the central government through financial incentives and business support for entrepreneurs through programmes such as Z-Park as well as the increasingly savvy Chinese consumers.

Oriental Pearl TV Tower, Oriental Pearl TV Tower, ShanghaiShanghai


Innovation in China – innovation & market structureInnovation and Businesses in China

‒ In addition, the increasingly savvy (and rich) Chinese consumers means that price is no longer the main point of difference. Instead, companies are focusing on branding and product innovation.

‒ At a macro-level, the Chinese nation is growing at a phenomenal rate partly because a large part of the nation is still under-developed. E.g. 60% of the Chinese population is still rural.

• Due to the fast moving nature of markets in China, most companies are focusing on “iterative” innovation rather than “breakthrough” innovation.

Spotlight: Opportunities from Changes in Government

Regulations

•Example 1: Starting 2010, all print media in China will have to attract foreign investment and will no longer receive subsidies from the state.

•Example 2: By 2014, all TVs in China will be digital. The cable companies will run the operation while Telecom companies must sell the infrastructure and data to these companies.

Spotlight: Opportunities from Changes in Government

Regulations

•Example 1: Starting 2010, all print media in China will have to attract foreign investment and will no longer receive subsidies from the state.

•Example 2: By 2014, all TVs in China will be digital. The cable companies will run the operation while Telecom companies must sell the infrastructure and data to these companies.

• Increasingly, Chinese companies are focusing on innovation and R&D as their competitive advantage rather than price. This is driven by the following factors: ‒ The constantly changing regulatory

environment means markets can change rapidly and companies must innovate their business models rapidly to keep up/take advantage/de-risk market changes.

The Pudong Skyline, ShanghaiThe Pudong Skyline, Shanghai

Spotlight: The Chinese Dairy Industry

•The Dairy industry in China is a good example of how quickly macro-environment can change in China. •8 years ago in 2001, the total dairy production in China was half that of NZ’s. Now, Chinese dairy production is double that of NZ. •In China, average yearly dairy consumption is 25L, which is 1/10 of the world average. •China is currently one of Fonterra’s largest customers. It is likely to surpass all other nations in the near future. •In addition, there is no regulation on ownership structure of dairy corporations, which means it can be 100% foreign owned and operated.

Spotlight: The Chinese Dairy Industry

•The Dairy industry in China is a good example of how quickly macro-environment can change in China. •8 years ago in 2001, the total dairy production in China was half that of NZ’s. Now, Chinese dairy production is double that of NZ. •In China, average yearly dairy consumption is 25L, which is 1/10 of the world average. •China is currently one of Fonterra’s largest customers. It is likely to surpass all other nations in the near future. •In addition, there is no regulation on ownership structure of dairy corporations, which means it can be 100% foreign owned and operated.


Entrepreneurship in China Z-Park (Zhong Guan Cun) Site Visit• China is now the second largest venture capital market (next to the

US) in the world. Return multiple expectations for a investment exit is 5x – 7x and a good ROI is expected to be around 30% IRR.

• Z-Park is China’s leading technology park and the flagship model of government policies in encouraging innovation and entrepreneurship in China (more on the specific programme next page). It is spread across 10 district areas, covering a total area of 282 square kilometres. There are over 30 research institutes and 30 leading Chinese universities in the vicinity.

• In addition to the central “Z-Park”, there are dedicated areas for specialised industries, such as health science, biotechnology, software and animation. Z-Park houses 22,000 start-ups – around 2,000 fold and 4,000 new companies are created every year.

• Z-Park is increasingly becoming the driving force of innovation in China. It has produced the first Chinese CPU chip as well as key space technologies for China’s space programme.

• Examples of Companies that started in Z-Park: ‒ Lenovo, Siovac, Sohoo, Sina, Baidu and Aigo‒ Foreign firms that have a presence there include: Microsoft,

AMD, Google, IBM, Oracle, Siemens and Phillips. ‒ Total revenue from all firms in Z-Park is 10 billion RMB (US$1.5

billion). Delegation with the Z-Park Director Delegation with the Z-Park Director of International Relationsof International Relations


Minesage Site Visit – Example of Business Model & Product Innovationhttp://www.minesage.com/• MineSage is a technology firm that pioneered Business Intelligence (BI) consulting

in China and is the parent company of AdSage (Search Engine Management Software) and TouchSage (provider of large touchscreen technology). It is a good example of both business model and subsequently product innovation of Chinese firms.

• The founder, a Chinese international student with a few years of experience as a software engineer, started Minesage in 2000 after returning from the US. He saw an opportunity to penetrate the BI market by innovating via the way such services are sold to the client – through the translation of BI literature and BI training seminars.

• The readers of the BI literature and audience of the seminars soon became sales leads and Minesage started advising companies of their BI strategy and helping firms in choosing their implementation partners. Minesage now earns ¥50 million in revenue p.a. and their clients include: Nokia, Microsoft, Siemens, Sina, China Mobile and Huawei.

• Minesage then became strategic outsourcing partners to a number of Western hi-tech firms – e.g. Microsoft and Facebook. Through this, they were able to rapidly identify gaps in the Chinese market. The company launched their first product – adSage, a search engine management software with patent protection for several key technologies. The software manages online advertising campaigns.

• The company have also just recently launched their touchscreen technology which allows corporations to showcase their products and services at exhibitions. Customers include the Beijing Municipal Government and BMW China.

Delegation with the Delegation with the founder of Minesagefounder of Minesage

Bowen and Jack looking at Bowen and Jack looking at Touchsage TechnologyTouchsage Technology


Kami (开米 ) Company Site Visit – Example of Product Innovationhttp://www.kaimi.com.cn/• Kami (or in Chinese Pinyin – “Kaimi”) pioneered environmentally

friendly home cleaning products in China.

• Kami is one of the growing group of Chinese company that has a heavy emphasis on product innovation. This can be reflected in its heavy emphasis on R&D – which constitutes around 5% of the company’s annual budget. Its cleaning products’ minimal environmental effects also make it one of the few Chinese companies certified by Dow Chemical.

• Founded in 1997 in Xi’an, Kami has 1,200 employees. They are a vertically integrated company that controls the R&D, design, production marketing and distribution of all their own products.

• They have 30 sale branches in China with the 3 biggest foreign markets being in Japan, Australia and the United States.

• Examples of its environmental protection: phosphate free; no fluorescent agents, alkaline free; aluminium free; anti-static; recyclable plastic containers and all products are biodegradable.‒ One of the first companies to introduce a separate detergent for washing

vegetables (considered essential in China).

• The company has refused buy-out offers from S. C. Johnson & Son and Amway. Kami is currently planning an initial public offering with JP Morgan and Goldman Sachs. The goal of Kami is to become the Proctor and Gamble of China.

Delegation with the Delegation with the CFO of KamiCFO of Kami

A live demonstration A live demonstration of Kami’s productsof Kami’s products


Shanghai Stock Exchange Site VisitThe Equity Investment Environment in China• In the mere space of 19 years, Shanghai exchange has grown

from 8 listed companies to 868 listed companies, with the biggest Initial Public Offering (IPO) in world’s financial history issued there in 2008 (ICBC IPO). The Stock exchange is now 3rd in the world in terms of trading volume, with 140 billion RMB exchanged daily.

• The Chinese Stock Market is very unique in that it is dominated by retail and not institutional investors (80% of the accounts are retail investors, with the remaining 20% as institutional investors).

• In addition, the level of foreign investment in the Chinese stock market is also heavily regulated. Only Qualified Foreign Institutional Investors may trade on the Shanghai Stock Exchange and their entire investment value cannot exceed US$30 billion p.a. ‒ There are also heavy incentives for Chinese domestic financial institutions

in an effort to build China’s own financial services industry.

• Hence, the Chinese government is very cautious about issuing new financial products due to the dominance of retail investors, as social stability is at stake. Currently, the government is looking to implement a new futures exchange in Shanghai.

• The Shanghai Stock Exchange - like NYSE - is aiming to the market for both domestic and international blue-chip companies to list, while the ShenZhen stock market will focus more on smaller companies like the NASDAQ.

Delegation with the International Director of Delegation with the International Director of the Shanghai Stock Exchangethe Shanghai Stock Exchange

The Trading Floor of the Shanghai Stock Exchange (little The Trading Floor of the Shanghai Stock Exchange (little activity due to the rise of electronic trading)activity due to the rise of electronic trading)


Shanghai Expo 2010 Site Visithttp://en.expo2010.cn/• The Shanghai Expo 2010 is a scheduled World Universal Exposition, taking place

from May 1–October 31, 2010. Traditionally, these expos are the third largest event in the world in terms of economic and cultural impact after the FIFA World Cup and the Olympic Games.

• Covering an area of 5.28 square kilometres, the Expo is expected to generate the largest number of visitors in the history of world fairs in terms of gross numbers – 70 million visitors (85-90% are domestic visitors).

• In preparation for the Expo, Shanghai has undergone massive reconstruction. This includes a new maglev line directly connecting the Expo site and the airport; diverting all traffic on the Bund underground and making the area a pedestrian crossing; and construction of a 35 km bridge for Shanghai’s new deep-water port

• The theme of the exposition will be "Better City – Better Life" and signifies Shanghai's new status in the 21st century as a major economic and cultural centre. Aligned with these concepts, the NZ$40million NZ Pavilion will follow the theme, “Cities of Nature, Living between Land and Sky”.

• The Shanghai Expo 2010 is a once in a lifetime opportunity for NZ businesses to showcase their products and services on the world stage.

The NZ Pavilion (prime location – very close to the Expo Axis)

Delegation with the 2010 Expo Mascot Delegation with the 2010 Expo Mascot “Haibao”“Haibao”

ArtistArtist’s’s Impression of Impression of the NZ Pavilionthe NZ Pavilion

Expo Axis

The Chinese Pavilion (crown of the East)


New Zealand Central Site Visithttp://www.nzte.govt.nz/nzcentral• New Zealand Central (NZC) is a business centre for NZ companies

and provides a physical presence for the NZ brand in Shanghai. NZ Central is the first of its kind in China for any country. NZC is 950 square metres and has been established especially before the Shanghai Expo as a “home base” for NZ Businesses.

• Officially launched by PM John Key in April 2009, it is a fully NZTE-funded initiative run by 8 full time staff.

• It primarily serves three main functions: ‒ Events: events could entail a cocktail function for 160 people or a

small meeting over lunch. Facilities include NZ beverages (NZ beer and wine), and chef demonstrations

‒ Consulting & Office Space for NZ Businesses: these NZ business are terms as the “clients” of NZ Central. There are 28 different clients in total, e.g. GlidePath, Fonterra, Air New Zealand, Navico, Tourism NZ, Red Fern Association and Aucom. NZC also provide industry education and assist with credibility and capability building.

‒ Hot Desking: NZ$35 for using all facilities for one day, including tea/coffee, broadband internet. For more frequent users, there are membership programmes, prices range from $300-$1200 p.a.

Delegation with Director of NZ CentralDelegation with Director of NZ Central


The New Zealand Centre at Peking UniversityOverview• The NZ Centre is founded in 2007, joint-sponsored by

Peking University, University of Auckland, Victoria University and Otago University.

• The goal is to build it as an inter-disciplinary centre that positively reinforces the relationship between New Zealand and China.

• The centre runs a number of competitions and cultural exchange programmes: ‒ Professor Paul Clarke organised NZ movie month

with 12 movies from NZ. ‒ “NZ through my eyes” competition where students

from 8 universities had to write a blog about New Zealand. The price was to a sponsored trip around New Zealand.

• There are a number of open courses, delivered in English. The teaching methods are small in size and workshop based. Students have to give presentations. This is quite unique at PKU and students find this appealing.

NZ Delegation with Groups of Peking University StudentsNZ Delegation with Groups of Peking University Students

NZ Delegation with the Director of NZ CentreNZ Delegation with the Director of NZ Centre


Urban DevelopmentOverview• China is a country rich in culture and tradition, complex in social and

political structure, diverse in ethnicity and regional differences, disparate in levels of affluence, and huge in terms of population and environmental implications. There is no doubt that it is a country on the ascension, which will have significant global impact in every way.

• The road to modern China has been fast and challenging for its leaders and people, with many lessons to learn on the way. As a developing country, it is advanced in many aspects, whilst adolescent in others. There is a realisation that to be truly sustainable, economic gains must be balanced with acknowledgement of social and environmental issues.

• Although at a stage of still learning from others, China is investing heavily in research and development, so that it can again be a world leader. This aspiration is part of a growing national spirit and optimism.

• The impact of China’s growth is immediately obvious in its changing cityscape. There is a gravitation towards either historical or modern symbolism without much critical thought towards how the paradigm of modern China may inform or transform the nature of the contemporary Chinese city. The model of Shanghai PudongThe model of Shanghai Pudong


Urban DevelopmentOverview• Incredible urban growth has resulted in the demolition of

many old structures. This was a legacy of the Cultural Revolution, as well as being encouraged during the post 1980’s opening up era. The trend continues today, with relocation of inhabitants from city centres to make way for prestige commercial and hospitality developments.

• New urban form seems to follow two general approaches. On one hand there is the appropriation of historic form to infer a sense of legitimacy. On the other, there is an adoption of global modernism as symbolic of progress and achievement. Both seem fixated on size and height over place making and quality of space.

• Public spaces still feel as though they are intended to be ceremonial space, with an emphasis on ornamental viewing instead of inhabitation. Grass areas are often cordoned off, and designated areas for rest or relaxation are not readily apparent.

• As cities develop and arts and culture mature to follow economic progress, there seems great opportunity for urban responses which acknowledge and interpret both past and future, tradition and technology, context and innovation in defining a New Chinese Urbanism.

The National Centre for Performing Arts in BeijingThe National Centre for Performing Arts in Beijing

The Birdnest Olympic StadiumThe Birdnest Olympic Stadium


BeijingUrban Development• Capital since 13th C. Based on traditional

walled city layout with major north-south and east-west axes.

• Modern Beijing is a gridded city structure with ancient city at its heart, encircled by concentric ring roads. Currently 5 ring roads, with 6th under construction, and an ultimate plan of 8.

• Urban scale is vast, with broad roads, paths, buildings. Streets are regulated and orderly, with iconic monuments aligned along ceremonial corridors.

• Beijing is experiencing severe traffic congestion, with registered vehicles exceeding 4 million by the 2009.

• Sense of layered inhabitation, with much of everyday life removed from main streets into lanes and alleys. Creates interesting contrast between intimacy of old and bulk of new.

Globalisation & the Urban Landscape

•During a visit to the prestigious Peking University, some students bemoaned the fact that while standing at Guomao station in Beijing one could scarcely be aware of the fact that they were in China – such is the proliferation of steel skyscrapers and Western boutiques in congregation. •Many students have argued for the neo-architecture springing up around Beijing being in fact representative of New China, as no other nations are currently undergoing such scope and ambition in construction. •A common theme amongst many young people was “can we slow down and make sure we don’t lose sight of who we are as a people”

Globalisation & the Urban Landscape

•During a visit to the prestigious Peking University, some students bemoaned the fact that while standing at Guomao station in Beijing one could scarcely be aware of the fact that they were in China – such is the proliferation of steel skyscrapers and Western boutiques in congregation. •Many students have argued for the neo-architecture springing up around Beijing being in fact representative of New China, as no other nations are currently undergoing such scope and ambition in construction. •A common theme amongst many young people was “can we slow down and make sure we don’t lose sight of who we are as a people”

Beijing CBDBeijing CBD

Typical Beijing Rush-Hour Traffic

The Bell-TowerThe Bell-Tower


Xi’anUrban Development• Crucible of Chinese culture and politics,

which flourished as the previous capital Chang’an in the Qin Dynasty (ca. 225 BCE, and from which we derive the English term “China”).

• Thought to be world’s largest city at the time (1 million people, with a cosmopolitan society due to its importance as a trade link between East and West. Links with Islam established at the time still remain.

• Modern Xi’an is a second tier city of 7 million inhabitants and capital of Shaanxi Province.

• Untouched by latter conflicts, so retains an interesting mix of imperial heritage and early modernist buildings.

• Redefining itself as a centre of cultural tourism. Imperial period architecture popularized and appropriated to create new cultural assets.

Return to Classic Form in Contemporary Chinese Culture

•The Guanzhong Folk Museum outside Xi’an demonstrates the return to preservation of Ancient Chinese culture. •A wealthy property tycoon saw the damage that the rapid typhoon of Shaanxi development was causing, and hurriedly bought up more than 20,000 relics as farmers rebuilding their houses reported each discovery. •Gathering them in one place at an enormous cost, this private museum is now an intriguing representation of how Chinese are preserving their culture and the tourist opportunities available through this retro trend.

Return to Classic Form in Contemporary Chinese Culture

•The Guanzhong Folk Museum outside Xi’an demonstrates the return to preservation of Ancient Chinese culture. •A wealthy property tycoon saw the damage that the rapid typhoon of Shaanxi development was causing, and hurriedly bought up more than 20,000 relics as farmers rebuilding their houses reported each discovery. •Gathering them in one place at an enormous cost, this private museum is now an intriguing representation of how Chinese are preserving their culture and the tourist opportunities available through this retro trend.

Shananxi Folklore VillageShananxi Folklore Village

Xi’An City SquareXi’An City Square Big Wild Goose PagodaBig Wild Goose Pagoda


ShanghaiUrban Development• Young city located at mouth of the Yangtze River

which came to prominence during the Qing Dynasty as a centre of trade and commerce. The site of various conflicts during latter 19th and early 20th C, resulting in occupation by foreign powers. Colonial heritage has resulted in a cosmopolitan mix of eastern and western influences unconstrained by Imperial past.

• Modern Shanghai is an international metropolis striving to resurrect world class status.

• Incredible growth driven by commerce and investment and a migrant population openly embracing change.

• Tall and dense in scale, it shows examples of mixed use and an acknowledgement of both modernity and heritage, resulting in a fine grain and vibrant urban character.

Shanghai PudongShanghai Pudong

Shanghai PudongShanghai Pudong


HeritageOverview• There is a growing appreciation of heritage value, but often with a commercial agenda.

This rediscovery of culture is employed as a strategy to stimulate tourism and investment, generally around sites of imperial or religious significance.

• A common approach is to themetise the old, preserving and embellishing significant buildings to make them more authentic, but also to surround them with stylised supporting buildings. This has led to an interesting phenomenon of the ‘New Old’, the demolition and rebuilding of buildings in neo-traditional style, but with modern conveniences.

• An example of a more contemporary approach to heritage is Zone 798 Arts District in Beijing, where 1930’s Bauhaus factories have been turned into a gallery/studio/café precinct, co-existing with light industrial facilities. This adaptive reuse has resulted in a complimentary mix of uses. In addition to being an artistic quarter, is also a playground for tourists, students, fashion shoots and wedding couples.

• Other examples of adaptive reuse include the Hutong and Siheyuan of Beijing, and precincts such as Xintiandi in Shanghai. These however, have a much more direct commercial agenda.

798 Creative Area: factory 798 Creative Area: factory converted art galleryconverted art gallery

Wedding couples at 798Wedding couples at 798

The NZ Delegation at 798The NZ Delegation at 798


SustainabilityOverview• Sustainable development previously overlooked for short

term economic progress.

• Government/Industry approach to sustainability seems to be supply driven and technology reliant.‒ Energy - heavy reliance on fossil fuels. Solar water

heating and solar powered signage contribute to reducing demand on infrastructure.

‒ Water - supply shortage in Northern parts of China being tackled by various means from ‘cloud seeding’, to a proposal to pump water from Southern flood prone areas of the Yangtze River.

‒ Infrastructure - major spending on public transport and urban services, plus initiatives such as vehicle restriction days. Resulted in interesting cultural side-effects, such as increased traffic on 8 plate days.

‒ Environment - growing public concern has led to establishment of companies providing environmentally conscious products and services. Some may be in the embryonic stage, concentrating on end product, while still needing to develop sustainable processes and facilities. The smog over ShanghaiThe smog over Shanghai


Ageing Population & EducationOverview of Issues• Ageing Population

‒ Legacy of one child policy combined with longer life expectancy putting pressure on the health and welfare system. These are now becoming re-regulated after dissolution of public services during early economic reforms, which led to some major health disasters.

‒ The older age bracket also has a high unemployment rate due to closure of previous state enterprises combined with low education levels making it difficult to find new employment.

• Education‒ Younger generation more educated than elders, with exposure to

wider influences and looking to question the status quo. With education seen as direct route out of poverty, school is a very competitive environment, and the desire to send children to prominent institutions involves economic sacrifice by many families.

‒ Study direction is strongly influenced by career opportunities instead of personal interest, with course of study often assigned by institutions, not selected by students.

‒ To retain more students, domestic universities are partnering with overseas institutions to provide more prestigious courses, and changing teaching methodology from passive to active learning.

Peking University Front Door-StepPeking University Front Door-Step


Urban MigrationOverview of Issues• Urban Migration

‒ Demand for labour has created and urban underclass with no legal status. Hukou (family registration) is an antiquated policy to restrict population movement based on place of family origin, but also limits access eligibility to health, schooling, accommodation, etc.

• Around 400-500 million rural population will move into the urban areas to forge ahead the development of urban centres. These people have limited to little legal protection, their children have a lack of education and are looked down upon by others in the city.

‒ Independent initiatives such as special migrant schools and migrant rights organisations have been established to address this issue, but are poorly resourced.

‒ There are also capacity building programmes in rural communities to stem economic migration to cities. Rural labourer on the streets of BeijingRural labourer on the streets of Beijing


Ethnics Tensions & Non-Government OrganizationsOverview of Issues• Ethnic Issues

‒ China has approximately 50 minority ethnicities, but population is 93% Han. Increased acknowledgement of minority identity is part of the Government’s vision for a ‘Harmonious Society’. This is promoted through public exhibitions, symbolism and recognition of persons committed to assisting minority communities. There is also policy for increased ethnic representation at local government level.

‒ However, debate over integration vs. forced resettlement remains, as does the freedom to practice culture and religion subject to being within State guidelines

‒ These uglier problems remain underground outside public discussion, and due to media censorship can only really be spread through word of mouth.

• NGOs in China: ‒ There are around 3 million NGOs in China, however, most

are not recognised by the government. ‒ The Sichuan earthquake has shown the importance of these

organisations in reaching areas that the central government often has trouble reaching.

‒ While they provide benefits, they can also be problematic in causing social unrest. The government needs an centrally sanctioned agency to deal with the NGOs.

Crowd of Tourists on Tian’anmen SquareCrowd of Tourists on Tian’anmen Square

The 55 officially recognised minority groupsThe 55 officially recognised minority groups


Modern ChinaOverview• The People’s Republic of China has recently celebrated the 60th anniversary of its foundation in magnificent style . The crux of

these celebrations has centred around a Soviet-style military parade inspected by leaders of the Chinese Communist Party (CCP) at the iconic Tian’anmen.

• While Western media has largely focused on the militaristic nature of celebrations – invoking such clichés as ‘the dragon awakens’ – the Chinese hold a different interpretation of events, contributing to an ever-shifting and evolving dialogue regarding national identity and what it means “to be Chinese”.

• Tragedies of its colonial history weigh upon the Chinese consciousness, and it is against this contextual backdrop that modern engagement with the West must be framed. Rather than merely serving as oft-referenced “coming out parties”, the 2008 Beijing Olympics and the 2010 World Expo Shanghai have been designed to catalyse development and establish world-class global powerhouses for culture and commerce respectively. The way in which this nascent world power comes to view and define itself will be of paramount importance during the next century of Sino - NZ relations, and the challenge for New Zealand engagement is to understand and respect China in her own terms.


The “New China” SocietySociety & Culture• In attempting to understand “New China”, it’s beneficial to understand the history of ‘Old

China’.

• Imperial Dynasties‒ Chinese civilization originated around the Yellow River, developing through a series of

feudal dynasties. Notable dynasties include:‒ Zhou (1045 – 221 BC) - development of intellectual thought such as Confucianism and

Taoism, and imperial rule via ‘Mandate of Heaven’.‒ Qin (221 – 206 BC) - unification of core states, establishment of the Great Wall and

legal rules of governance.‒ Tang (618 – 880 AD) - golden age of Chinese prosperity and culture.‒ Qing (1644 – 1911 AD) - last dynasty marked by increased contact with western powers,

domestic turmoil and colonial conflicts leading to concession of Chinese territories.

• Rise of Nationalism‒ The Nationalist and Communist parties formed in the early 20th C as a reaction to

perceived weakness and corruption of the Qing Dynasty. With similar aims, but different ideologies, both parties united briefly against Japanese occupation. However, after defeating the Japanese, they once again entered into a bitter civil war, resulting in the Nationalists fleeing to Taiwan and Communists assuming power.

• Peoples Republic of China‒ Socialist regime formed in 1949 and led by Mao Zedong. The Chinese Communist

Party centralized policies for industry, education and healthcare, and raised the standard of living for much of the working class. However, campaigns designed to purge old elements such as The Great Leap Forward and Cultural Revolution resulted in widespread famine, hardship, and damage to cultural heritage.

The infamous sign that was put up The infamous sign that was put up in Shanghai in the French in Shanghai in the French

concession areaconcession area


The “New China” SocietySociety & Culture• A relatively recent concept, ‘New China’ commonly refers to the

period of openness and economic reforms since the 1980’s, as spearheaded by Deng Xiaoping – who was famously quoted as saying “No matter if it is a white cat or a black cat; as long as it can catch mice, it is a good cat. ”. He coined the phrase ‘Socialism with Chinese Characteristics' to explain seemingly paradoxical aims of a centrally controlled market economy, wanting both to initiate rapid change, while controlling the rate of change. As a country seeking to reinvent itself, “New China” is full of such shifting paradigms.

• Socialist Market Economy‒ Essentially State controlled capitalism, with a focus primarily

on economic progress. One party rule has allowed for accelerated development, but whilst necessary for growth, it is viewed by some as detrimental to quality of life. Assets and utilities are generally government controlled, with a drive for privatization or ‘non-public ownership’ of other sectors.

‒ In contrast, the western democratic process which can often slow down development. Western economies are now also questioning the merits of unchecked capitalism, with a drift towards social responsibility and localized economies.

The Shanghai Stock ExchangeThe Shanghai Stock Exchange

Mao Zedong (Chairman Mao) Portrait on the Front Mao Zedong (Chairman Mao) Portrait on the Front Entrance of the Forbidden CityEntrance of the Forbidden City


The “New China” Society Society & Culture• Growing National Spirit

‒ Culture and heritage have been officially rediscovered after years of denunciation. There is a desire to celebrate and showcase historic achievements, often through mimicry of past epochs and idealized styles.

‒ This is in part State propagated, but also a genuine sentiment of patriotism amongst the people independent of politics.

• Aspirational‒ The industrious nature of life in both urban and rural areas

is a reflection of the desire to change personal circumstances. This is also apparent in the consumption of status symbols as a sign of success, echoing another of Deng Xiaoping’s mantras, ‘let some of the people get rich first’.

‒ Modern Chinese society seems at a stage of adolescence, wanting to assert its individuality and push boundaries. The leadership is seeking to maintain the ideal of a ‘Harmonious Society’, through encouraging cohesion over diversity. This has led to oscillation between expansion and contraction of society.

The tallest skyscraper in ChinaThe tallest skyscraper in China


Conclusion: New Zealand and China

• China is an incredibly ancient civilisation with 5000 years of rich cultural heritage• New Zealand is a new nation with traditions of diversity, agriculture and innovation• The two countries share a long history of exchange, eg. 19th Century goldrush; Rewi Alley • New Zealand – Chinese relationship is currently “at its best in history” – Premier Wen Jiabao to

John Key, April 2009

Established diplomatic relations relatively early in 1971 – recently celebrated 35 years

Sponsored China’s entrance to WTO

First developed country to ratify China’s free market status

First developed country to sign an FTA with China, 7 April 2008

Our relationship with China is limited only by how much we respect, understand and share with each other

NZ-Sino Youth Exchange (New Zealand China Youth Exchange)

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