Chinese Transnational Enterprises
Over the past century many Chinese transnational enterprises have established a strong presence in South China and Southeast Asia. Many of their successes have been the subject of numerous academic investigations. Some attribute their successes to the cultural affinity they share with their homeland as well as to the elaborate networks of 'qiaoxiang' ties they have set up and operate. Others claim that their operations and presence are indicative of the gradual emergence of a unique form of diaspora Chinese capitalism, network capitalism, or entrepreneurial capitalism which is characterized by flexibility, invisibility, and family orientation. However, such discourses are not unambiguous and uncontested.
By DAVID IP
For one thing, transnational entrepreneurship involves more than the utilization of cultural and constructed social ties to the homeland. It also requires careful manoeuvring of values, attitudes, and behaviour across national boundaries and socio-cultural systems as well as strategic responses to sudden and unanticipated changing political and economic conditions imposed by national government policies and international constellations. As south China and Southeast Asia become integrated regionally under the force of globalization which propels them through times of both economic prosperity and adversity, as evidenced by the rapid growth in the 1980s and the current, persistent financial crisis, an understanding of these ambiguities is both urgent and timely.In August 1999, the third IIAS Programme: International Social Organization in East and Southeast Asia: Qiaoxiang Ties during the Twentieth Century (hereafter referred to as Qiaoxiang Programme) held an international workshop in conjunction with the Centre of Asian Studies at the Hong Kong University, bringing together a group of international scholars from China, Taiwan, Hong Kong, South Korea, Japan, Singapore, England, Germany, Canada, Australia, and the Netherlands who are working in diverse fields of academic disciplines to document and dissect the central dynamics of Chinese transnational enterprises in South China and Southeast Asia during the twentieth century. At the end of the workshop, the co-ordinators of the qiaoxiang programme decided to put together a volume of readings based on some of the selected papers to summarize its outcomes. The rationale of the intended publication is multi-fold. It proposes to:
1. clarify and highlight the concepts, theories, and work in progress currently being contested in the discourse on Chinese transnational enterprises;
2. illustrate how historically overseas Chinese entrepreneurs have restored and used their business ties and networks to organize their capital and labour to create new business opportunities for growth and to restructure their enterprises to adapt to and overcome grave economic and socio-political conditions;
3. document the recent transformation of Chinese transnational enterprises in terms of business structures, modes of operation, style of management, and crisis management strategies in the face of increasing internationalization and globalization;
4. investigate the relationship between the current Asian crisis and Chinese transnational enterprises and their coping strategies;
5. contribute to the on-going process of theorizing of Chinese transnational enterprises.
This publication is divided into five sections. The introductory section will begin by surveying the concepts of qiaoxiang ties, business network, family firms, diaspora Chinese capitalism, network capitalism, and entrepreneur capitalism that are currently under intense scrutiny, especially in the wake of the recent Asian financial crisis. It proposes that a deeper understanding of the nature and operation of transnational Chinese enterprises in South or Southeast China must incorporate a historical review of both the organization and activities of diaspora Chinese business in the early twentieth century, without which an analysis of their recent structural transformation and adaptive strategies is impossible. To illustrate this, part two begins by an examination of the cases of Taiwanese merchants' trading activities between Taiwan and Japan between 1895 and 1945. Then it moves on to document the Li family's investment in Xiamen, the restoration of ties through brokers in south Fujian by overseas Chinese in Southeast Asia, and the expansion of Eu Yang Seng's family business empire in Guangzhou, Hong Kong, and Southeast Asia.
The focus on recent transformations of Chinese transnational businesses in terms of their structures, forms and management becomes apparent in Part Three. For example, the continuous growth of the Eu Yang Seng's family business beyond the fourth generation in East and Southeast Asia, the changing nature of overseas Chinese donations to Xiamen in recent times indicating a shift from welfare provision to fostering business relations, the attempts of Korean chaebol to make alliances with ethnic Chinese firms in China, the changing style of management, attitudes towards human resource management and labour relations in German, Taiwanese, Hong Kong, and North American funded enterprises in China, have revealed not only that 'Chinese' transnational enterprises have become much more complex in their structures, activities, and management, but have underlined that important questions have also been raised about the usefulness of the 'cultural affinity' theory in ensuring good industrial relations and economic success of transnational businesses operated in mainland China.
The recent financial crisis that struck the Asian region has had varied impacts on how these transnational Chinese businesses will be operated in the future. Part Four will therefore make a specific examination of the case of Ng Teng Fong's expansion, the restructuring of business activities by ways of corporatization, internationalization, and diversification among businesses in Hong Kong, Taiwan, and Southeast Asia. It is proposed that the changes that have been implemented since the crisis are indicative of the future directions Chinese transnational enterprises will take.
This book argues that the recent changes are not merely cosmetic. In Part Five of this publication, the shifting strategies in network construction, the maintenance of qiaoxiang and other ties necessary to the strengthening and consolidating of Chinese business transnationally are seen to reflect a fundamental movement towards the emergence of a new ideology and theory of diaspora Chinese entrepreneurship. The current declining use of qiaoxiang ties and the rapid modifications in Chinese business culture and practices among Chinese transnational enterprises may be interpreted as a process of gradual decentering that not only encourages the rise, but also a reconfiguration of entrepreneurial networks in Chinese society.
The scholars who present their research findings in this volume include Dr Dai Yi-feng from Xiamen University ('Southeast Asian Chinese Investment in Xiamen: A case study of Li family'), Dr Chung Po-yin from Hong Kong Baptist University ('Doing Business in Southeast Asia and Southern China: Booms and busts of the Eu Yan Sang business conglomerates, 1876-1941'), Ms Song Ping at CASA Amsterdam ('Southeast Asian Chinese Transnational Enterprises in China: Qiaoxiang ties and the Tee family'), Dr Henry Yeung of University of Singapore ('Managing Traditional Chinese Family Firms Across Borders: Four generations of entrepreneurship in Eu Yang Sang'), and Dr Zhuang Guo-tu of Xiamen University ('Overseas Chinese Donations to Xiamen since 1978'). They will contribute to the second part of the book.
The papers by Dr Peter Li and Dr Zong Li at University of Saskatchewan ('Transnational Chinese Businesses in Tianjin: Rethinking cultural affinity and economic performance'), Dr Irmtraud Munder of the Centre for Technology Assessment in Baden-Wurtemberg, Germany ('The Geman Machine Tool Service: A workfloor case study of a German-based transnational small enterprise in China'), Dr Cen Huang of University of Calgary (Mismatched Cultural Affinity: Industrial relations in overseas Chinese enterprises in South China'), Dr Renate Kreig and Kerstin Nagels ('Receptiveness to Changing Practices in Human Resource Management: A comparison of mainland Chinese and Taiwanese employees in German-Chinese business') will form the main body of Part Three of this publication.
In Part Four, the works of Dr Rajeswary Brown from London University ('Chinese Land and Property Companies: Asset bubbles, financial inovation, and risk'), Dr Linda Low of National Singapore University ('Asian Crisis, Corporate and Financial Restructuring and Transformation of Traditional Chinese Enterprises'), Dr Constance Lever-Tracy and Noel Tracy (Flinders University of South Australia) and Dr David Ip (the University of Queensland) ('Winners and Losers: Crisis strategies of diaspora Chinese capitalism') will be the main features.
The contributors to Part Five will be Dr David Schak from Griffith University in Brisbane, Australia ('Chineseness and Chinese Capitalism in East and Southeast Asia'), and Dr Leo Douw, director of IIAS Qiaoxiang Programme ('Beyond Qiaoxiang Ties: Institutionalisation of transnational Chinese enterprises in the twentieth century').
The publication will be edited by Dr Leo Douw, Dr Cen Huang and Dr David Ip. Much of the editorial work has been completed and it is anticipated the volume and will be published in late November this year. *
Dr David Ip was an IIAS research fellow, Qiaoxiang Ties Programme.
E-mail: d.ip@mailbox.uq.edu.au