Wednesday, January 28, 2009

De Facto Slavery Resulting from Putting All Your Business Eggs in China's Basket

Though one may question the level of quality and respectability of Apple Daily and Next Magazine which seem to grab readers with racy photos, founder Jimmy Lai's life story is something of which Taiwanese businessmen should take note. The Ma administration, whose seemingly one and only policy agenda is driving Taiwan towards chain & manacle economic links with China, needs to pay attention, too.

Note that 1. when Jimmy Lai had clothing business interests in China, they only remained operative at the whim of the authoritarian Chinese government. And the minute Jimmy Lai wished to exercise his personal freedom of speech, the Chinese government threatened to close down all his factories.

Note also 2. that Jimmy Lai decided his own freedom was more important than making money at the expense of becoming the Beijing dictatorship's de facto slave.

And finally, note 3. that Jimmy Lai was able to both prosper and remain free, instead of having to say or do whatever the Chinese government demanded.

Remarkably, in this regard, this one man Jimmy Lai seems to have more guts than the governments of quite a few large nations of the world.

A recent BBC article gives this portrait of the man. You can listen to the interview here.

However accurate this portrayal, one certain thing is that Taiwanese businesses should not follow the lead of the current KMT government in Taiwan. Companies need to diversify their exports and factories to other countries such as the Philippines and Southeast Asian nations. Because if all of their focus is China, they will be at the whim and ultimately under the control of a Chinese government whose main purposes in letting you come in and set up shop is 1. to "steal" your technology and manufacturing knowhow by making sure it becomes indigenized in China and 2. to have a way to control you by threatening you with an arbitrary closure of your business and a loss of all your investments there.

It is foolish to put all one's eggs in the basket of China's authoritarian regime where there is no rule of law and no recourse, where rights are not seen as inalienable, but rather condescension and benevolent permissions issued by an all powerful, all ruling one-party state emperor.

NOTE: The following blog reports that Jimmy Lai has compromised when in comes to the KMT regime in Taiwan. There seems to be some deal going on so that Lai has appointed a crony and loyalist of President Ma as head of Next Media. This would tend to result in Next Media putting out a lot of pro-Ma propaganda in Taiwan. If this report is accurate, it shows that Lai is not particularly principled but does things mainly for his own business interest -- at least when it comes to Taiwan.


Anonymous said...

Jimmy Lai is indeed awesome, however, it should be noted that all businesses are operating at the whim of the government, even in Taiwan.

E.g. the company that developed a way to recycle stryofoam only to have the government ban the material. (after promoting it for many years for hygiene reasons.)

The plastic bag manufacturers who lost their businesses when Taiwan decided that bags could not longer be given away for free.

The camera tripod industry which moved to China in the beginning mainly because customers wanted to include free bags with the tripods but Taiwan had extremely high tariffs on Chinese bags to "protect" Taiwan's bag industry.

Or rules that require extensive relabeling of products or face draconian fines...Taiwan has many such rules.

China is only a more extreme example of this - but my philosophy is that while the government always claims credit for "helping" the economy, it actually does not much more than allow any business to exist.

DeMo! said...

In general, the more free the society & the more directly accountable the government is to the people (i.e. true democracy) & the more presence of the rule of law --- the less oppressive will be a citizen's existence.

Taiwan used to be very much under the thumb of an arbitrary one-party dictatorship and now possibly is heading more in that direction.

Citizens really do have to be ever vigilant to guard their freedom and vote in a way that calls their government representatives to account.

It was simply astonishing recently how the smoking laws were passed and forced on the entire population and businesses of Taiwan with very little fuss.

Perhaps there is a huge remaining psychology of being under authoritarian rule that goes back several thousand years of Chinese history and 300 years of Taiwanese history -- such that the citizens do think of themselves as subjects instead of thinking of themselves as rulers to whom the government is a subject and servant.

Taiwanrox said...

Nice blog.

DeMo! said...