This is China! blog

It was September, and an angry mob of 500 villagers were breaking through the chain-link fence of a solar cell factory belonging to Jinko Solar Holding Company, intent on ransacking the premises. A torrential rainfall had flooded the company’s mismanaged vats of toxic waste and carried the contaminated water into a nearby stream in Haining, Zhejiang province. On the day after the deluge, residents in the area reported seeing dead fish floating in the surrounding waters for hundreds of square yards.

The problem was a result of both government ineptitude and corporate inaction. Though the local Environmental Protection Bureau (EPB) punished the facility five months before the incident for improperly storing and managing the waste, the factory had continued to operate as usual. Jinko Solar was supposed to have paid a fine of RMB470,000 (US$73,600) and shut down the plant until its waste management system was robust.

But by the time the autumn rains had swept through, the facility had yet to act on any of the injunctions the EPB had set against it. The result was a rampage by angry local citizens that caused thousands of dollars in damage and demoted the “green credentials” of the New York Stock Exchange-listed company.

This is the irony of green- and clean-technology manufacturing in China: Without the proper technology, safety controls and management procedures in place, the manufacturing processes can be terribly polluting. In China’s rush to gain market share and satisfy its voracious appetite for energy, officials and companies have pulled out many safety stops and unhinged production goals from economic fundamentals.

Read the rest of my January 2012 China cleantech column here …

I recently had a conversation with a young(er) American expat who has been living in China nearly ten years. I had told him about the talk – The Warlord and the Engineer – the Royal Asiatic Society (Suzhou branch) had hosted a few weeks before. The remarkable thing about the talk was how the Danish Engineer Robert Christensen and adviser to the warlord Zhang Zuolin had meticulously recorded his life in journals while he lived in China during the 1920s, had cataloged hundreds of photos and had captured the times on film, as well. The expat and I agreed those of us living in China were experiencing a special period in its history – call it “The Goldilocks Time”, when wealth seemed to flood Chinese streets. One day, the rapid-development period will all be a distant memory. Who amongst us will be the chroniclers of this time?

The expat admitted he had desperately few photos of himself and his time here in China, despite a decade’s worth of experiences. I personally have a bunch of photos, the blog, the books I’ve written. And now that I have a son, recording the ordinariness of our lives here has become more important to me.

I told the expat that for me, while watching the photos and film footage of 1920s Mukden (Manchuria), what interested me most was not the foreigners frolicking in the foreground, but the locals toiling in the background against backdrops that are gone forever.

It’s tough to gauge just how precious one’s everyday existence may be to future generations.

Technorati Tags: china, expat life

The past month here on the ground in the Yangtze River Delta has seen activity that runs counter to macroeconomic measures in the property development sector. By all accounts, construction sites are supposed to be grinding to a halt and new projects deferred indefinitely. Instead, what I and Western friends are seeing is an acceleration of construction activity. Where for the last two years we’ve only had to bear incessant noise, dirt and dust from sunrise to sunset, now we are hearing construction activity 24/7 the past three weeks (whenever I became conscious in the shift of pace of construction). And new development projects are continuing to sprout up around us in a region that theoretically is economically mature. It seems a near-impossibility to escape the din of construction machines punching the ground or stamping steel or crunching concrete.

One building that friends and I were talking about in the Suzhou Industrial Park is still having floors stacked on its skeleton frame of concrete and steel while construction workers fix mirrored-windows to lower levels of the same structure.

We’re not entirely sure of why construction activity has accelerated recently; however, we’re sure it has to do as much with uncertainty about what the government will do next with the property sector as much as uncertainty about the Chinese economy in general. Some of the questions likely at the forefront of the minds of developers include: will the government end bank loans to developers completely at the end of the year? will they end all construction projects for and indefinite period of time? and will they be able to find buyers for their residential projects and renters for their office property?

One thing, however, is certain: the accelerated pace of construction does not fill me with any greater sense of security in the integrity of the finished structures.

Technorati Tags: bill dodson, china, construction, economy, infrastructure

FinanceAsia recently reported that officials in the northern province of Jilin were fired for permitting construction teams to fill bridge with garbage instead of with concrete.

China has fired at least 10 railway officials over a sub-standard Rmb2.3 billion ($360 million) construction project that involved bridges filled with trash instead of concrete, and builders without any relevant experience, including one team led by a cook.

I wrote about this sort of padding two years ago in an article for CHaINA magazine, when there was a rash of bridge collapses. Though officials were censured and construction companies fined, seems old habits die hard. Of course, the last thing the nation’s leaders need is for this to be found on their coveted high-speed railway.

Nevertheless, the company responsible for the garbage bridges, China Railway Material Commercial is pushing ahead with a Rmb14.7 billion ($2.3 billion) IPO in Shanghai.

A migrant worker who helped build the bridges said to Chinese media, “I wouldn’t dare to take the train once it’s finished.”

A wise man indeed.

Technorati Tags: china, infrastructure development

A Canadian acquaintance and I recently had a discussion about the state of China’s animation industry as part of the services outsourcing platform China has been promoting to the world. Mark has been an animator based in China for more than twelve years, mostly for Western productions. This year he took up a long-term project with a Chinese production company, which is creating a 3D animated movie. Mark was seeing that the animation industry in China had almost completely turned to create productions for the domestic market. “Costs are simply no longer competitive,” he said, “The Americans are doing their stuff in-house, now.” Quality and sophistication of the animations, as well, has a long way to go. Don’t expect any animated films or television series on the order of the Japanese “Ghost in the Shell” from Chinese studios perhaps in this lifetime (for reasons that are just political as they are technical).

Now that I have a toddler of my own I find myself flicking through local Chinese TV stations to find children’s programming that’s interesting for ME to watch. It doesn’t exist – at least, the stuff that’s domestically made. It’s all South-Park style animation – flat, basic shapes put together with citrus-sliced smiles. South Park animators, though, draw their characters with affect. Chinese domestic animators, I think, don’t have the budgets or the delivery schedules or the skills or the technology or the patience to produce Japanese-style animations (anime). I think the best Chinese animators are working for the gaming industry, where they can copy World of Warcraft and other popular universes.

Of course, salary inflation in China and salary deflation in the West have rebalanced the flow of animation work, dealing a blow not just to animation as a services outsourcing industry, but also to software application development, back office administration and other long-distance support services.

Seeing Chinese services outsourcing for international customers on the same scale as Indian-style platforms is as likely as seeing a well-drawn children’s animated feature come out of China with international appeal. A very long shot at best.

This past weekend I had the pleasure of introducing Simon Gjeroe to local Suzhou residents interested in hearing dramatic tales from the China’s warlord period. We had gathered for a monthly Royal Asiatic Society (Suzhou branch) talk on Chinese culture and society. Simon is proprietor of Beijing Postcards, which sells reprints and books of photos taken by foreigners visiting China in the 1800s and early 1900s.

The warlord period in China took place during the roaring 1920s, when warlords shifted sides and assassinated each other as often as they changed concubines, and when the majority of expats in Northeast China lived in the lap of luxury. Simon gave us all a unique peek into the life and times Zhang Zuolin, one of the mightiest warlords in China during the chaotic 1920s, as chronicled and photographed by the Danish arms dealer and adviser to Zhang, Robert Christensen. He also showed a 25-minute long documentary about the era, all of which was made up of photos and film footage taken by Christensen himself.

Simon revealed that five years ago Chinese were universally embarrassed by the photos taken of the country in the late 1800s through mid-1900s. “Why,” they would ask him, “do you want to look at old photos of how poor China was?” Now, Simon said, the Chinese make up the majority of his customers in Beijing. I was astonished when Simon pointed out that nearly all the old photographic and film images of China are from foreigners. The Chinese have little idea of what their lives really were like during the end of the Qing and warlord periods.

That is, not beyond the latest rounds of soap operas on Chinese TV.

Listen to my interview with Simon here .

Technorati Tags: beijing postcards, bill dodson, china, history, robert christensen, simon gjeroe, warlords

The Zhejiang city of Wenzhou has been having a bad run in the media lately, both domestic and international. ‘Wenzhou has the reputation in China of having been first and most successful out the gate when economic liberalization began thirty years ago, and of having the most millionaires per capita of any city in China that makes cheap stuff like plastic cigarette lighters, of which the city has some 80-percent of the world market sewn up, or some such. It’s fortune seems to be waning, however.

Most recently, a Jiangxi-born businessman based in Wenzhou jilted his workers of their wages, selling the factory’s equipment one evening and escaping with his girlfriend to his hometown in Jiangxi. It’s unclear whether his girlfriend was also from Jiangxi. The workers called the cops, who quickly caught up with him, according to the China Daily. As early as the end of the summer, according to the Wall Street Journal, Wenzhou companies were suffering from a dearth of lending from the national banks as Beijing continued to tighten lending to curb inflation in the country. Dozens of businesses have been closing, ever since. The problem has only been exacerbated as material inputs have increased, salary pressures have been eating away at profit margins and buyers in the West are unable to buy more stuff because of the global economic slowdown. Wenzhou has been fertile ground for a vast shadow banking system that profits from illegal loans to local businessmen, according to the Financial Times. Some Wenzhounese, though, tried to cheat their way through the bad times, but recently found out crime doesn’t pay.

Sixteen Wenzhou executives, ten local government officials and eleven others were found guilty last week “for graft, embezzlement, illegal distribution of State assets and bribery”, according to another China Daily report:

Ying Guoquan, a founder and former president of Wenzhou Cailanzi Group, was allegedly involved in graft, embezzlement, illegal distribution of State-owned assets and bribery, involving more than 400 million yuan ($63 million). Wenzhou Cailanzi Group is the largest enterprise for food production and processing in the city, supplying 98 percent of the vegetables, 80 percent of the soybean products and 60 percent of the seafood, according to the group’s official website.

The most remarkable aspect of the case, according to the China Daily article, was that, “The corruption case at Wenzhou Cailanzi Group was the most serious of its kind in the city in the past two years, according to Xinhua News Agency.”

Just goes to show, two years in China can feel like forever.

This past weekend Paul French came out to Suzhou to introduce his latest book to the Royal Asiatic Society. Midnight in Peking is a recounting of the true-life murder of a lovely British expat in 1937, just as the Japanese are about to sweep into the city. I interviewed Paul about the book and discussed with him his motivations for excavating the story and for trying to solve what has been a cold case for more than 70-years. The book has been top of the readers’ lists in Hong Kong and Australia for the past month.

Listen to the interview here.

Technorati Tags: bill dodson, china, detective, midinight in peking, murder, mystery, paul french, peking

A British mate of mine who has worked with Chinese supply chains since the late 1990′s told me he is seeing a sea change in domestic manufacturing. He’d worked in manufacturing in Britain for several decades before coming to China. The Chinese owners of the factories in China are beginning to reign in waste in their production processes. “Before, if they screwed up an order they’d just call in another hundred bodies for pennies, have them work overnight to remedy the situation, then let them go,” he told me. “Now,” he explained, “pay rates have gotten more expensive, material inputs are more expensive, and there’s not as much business to go around. So Chinese owners are beginning to look at how to improve their processes, get the orders right the first time the most efficiently they can. That’s another reason why some of them are looking into or investing in robots to do some parts of the job. Fewer errors.”

The former plant manager put the change into context for me. “It was the same in Britain in the sixties. We wasted a lot of material, made a lot of mistakes. Then, in the seventies, everything began getting more expensive to manufacture. We cleaned up our lines, our processes. Things like Total Quality and Lean Manufacturing came along. It’s a natural process. China’s not special in that way,” he added.

China’s going to find one day that economically, middle age sucks.

Technorati Tags: bill dodson, china, lean manufacturing, manufacturing, suppliers, supply chain, total quality

Paul French is giving a book talk in Suzhou this weekend, Sunday, at the Bookworm downtown. Penguin books just published his murder mystery, Midnight in Peking, in which he digs into the unsolved, real-life murder of a beautiful British expat, Pamela Werner, in Peking in 1935, days before the Japanese invade the city. It’s Paul’s 7^th book, his first historical fiction.

Apparently, Pamela’s body was horribly mutilated and dumped in a gully in the British legation. Though the mystery was never solved, Paul takes a crack at it based on the notes from the Chinese and British investigations, interviews with people who actually knew the girl (survivors are in the nineties, now) as well as the notes her father left behind in pursuit of the truth and justice. Orgies, drugs, booze and other unmentionable stuff (like the stuff I just mentioned) were apparently involved in the circumstances of the crime, making this an especially good read. A couple weeks ago the novel was the third best-selling book in Australia. The book will be on sale at the Bookworm.

The Suzhou Bookworm, Gunxiu Fang 77, Shi Quan Jie. 30rmb for students; 50 rmb for members; 70 rmb for non-members. Includes one glass of wine or beer. For more information, contact Bill Dodson at bdodson88@gmail.com.

Technorati Tags: bookworm, midnight in peking, paul french, royal asiatic society, suzhou