Notebooks from China (and much more) - Alberto Forchielli - ebook

A careful look at what is happening in the vast Asian continent made up from two authoritative observers of that world to give us, in real time, a picture of what is about to happen and what direction is taking the colossal China and Asian countries in general. This volume is composed by articles that encompass different topics: economy, politics, society, culture; clear and detailed focuses, supported by an active and long-time in those countries by the authors. Alberto Forchielli, founder and partner of Mandarin Capital Partners, a well-known face in Italy and abroad is one of the most distinguished scholars of Asia and its many souls; Romeo Orlandi is a university professor in Bologna teaching "Process of globalization and the Far East" and is active in several consultations aimed at the Asian world. Along with they direct Osservatorio Asia, a think tank created by a collaboration between representatives of business and academia to continuously analyze the economic relations between Italy and East Asia. This publication is the first in a series that starts the collaboration between Osservatorio Asia and KKIEN Publishing International, in which will be presented periodically updated and in-depth Notebooks from China.

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Collection Osservatorio Asia

KKIEN Publ. Int. is a trademark of KKIEN Enterprise srl

First digital edition: 2014

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ISBN: 9788898473793
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Table of contents


Almond-shaped eyes and sharp brains

Raw materials without a market?

The color—and nationality—of money

Strange but natural and deadly alliances between the local and Chinese mafias

A solid roof for Chinese investments

IPOs in China: when the norm is explosive and progress is straining to flourish

A new Latin American channel between Beijing and Washington

Impossible Isolationism

The thousand-year-old memory of the two Vietnamese sisters

China: Finance Without Banks?

Chaori Solar: A necessary failure

An Unsustainable Maritime Ambition

Macao’s Washing Machine

China and the Crimean Dilemma

Textiles, Tequila, Ephedrine: Mexico and China divided in the Fight Against Narcotics

Xi’s trip to France commemorating De Gaulle

Hope and the Law

A win-win situation with Europe. Will China win twice or will internal divisions allow inaction to prevail?

From “three no’s” to “three links” in the Straight of Taiwan

The track that could lead to the trigger

Detroit, Michigan, China

Australia: Politics and the Economy

Laying the foundations in the Philippines

The Trojan Pig

Beijing and Taipei: de facto allies

African Pride Wanted

China: the fuse between inequality and demographics

China: size matters

Thailand’s military coup and the end of Bangkok’s “Berlusconis"

Respecting rules and customs, delegating with social groups, and guaranteeing welfare: Beijing’s awful adventure in Europe

About the authors


Osservatorio Asia has traditional origins, an evolution hinging on modernity, and a fittingly undefined approach. It is a think tank born from a relationship based on collaboration between leaders in the business and academic worlds, with the objective of analyzing economic rapports between Italy and East Asia with continuity. Its only objective is to encourage business professionals and institutions to acquire a better understanding of Asian countries. OA promotes various activities (conferences, seminars, research, training courses, and publishing projects) in order to provide concrete support for internationalization and a structured understanding of globalization. OA ambitiously fosters its motto, “knowledge is a factor of success,” and operates under the guidance of a Scientific Committee.

It is, therefore, an intellectual organization hailing from a different culture than the digital age. Yet, it owes its growth to these very means of communication—digital publications, information, and networks. Osservatorio Asia is based on a software culture that allows it to reduce costs, timelines, and infrastructure. For more than 10 years, Osservatorio Asia has been thriving on sponsorships, which have been repaid with quality and visibility. The decision to publish a series of eBooks containing contributions from OA fits perfectly into our portfolio of activities.

Almond-shaped eyes and sharp brains

Alberto Forchielli - December 30, 2014

Every three years, the OECD—the Organization for Economic Development and Cooperation, a 34-member club of the most industrialized nations with market economies—conducts a study to evaluate the competence of students across the globe. The PISA test (Programme for International Student Assessment) examines 500,000 15-year-old students in 65 countries, classifying them based on three subjects: math, science, and literacy. The most recent results published in December 2013, were surprising for many reasons, and raise questions that go beyond the boundaries of statistical work. Do the rankings definitely validate the East’s dominance? Do the tests correctly represent the universe they are trying to typify? Did China manipulate the tests to excel and reinforce national pride? The results don’t leave any doubts: Asia students’ preparation is far superior to even the richest nations. The best students are from Shanghai, then Singapore, Hong Kong, Korea, Taiwan, South Korea, Macao, and Japan. Italy is among the last places, the US is among the median for OECD countries, and even Finland—envied for its egalitarian, free and efficient scholastic system—is losing places. The revelations are essentially confirmed in the three articulations of the scrutinized subjects as well. The classification reflects the economic history of post-WWII East Asia. There’s the Japanese giant, the 4 tigers, the five Chinese, and the Red Dragon’s unstoppable rise. It’s tempting to conclude that almond-shaped eyes coincide with the best brains. The results certainly reflect growing economies, but also the desire for redemption, the tenacity of application, and the discipline of effort. It seems like the west is saturated and sick of studying, cradled in its comfort, while the parents’ generation and children who insist on instruction tend to social and material improvement. There is no shortage of criticism: mandatory application does not favor creativity; coerced study doesn’t liberate energy and promotes stress and depression. They are reasonable appraisals, but they don’t undermine the overall value of Asia’s performance. The other two observations are probably more appropriate. The representative ability of the national sample has been called into question, as is frequently the case when simplifying reality. Local authorities were asked to collaborate in selecting students, eventually substituting, and guaranteeing the students’ minimum presence. The prestige that fuels nationalism causes one to believe that each country has an interest in choosing the best students for the test, treating it like an Olympiad. Important commentators have voiced reasonable doubts concerning China, like those featured in Time Magazine and the South China Morning Post, Hong Kong’s most famous newspaper. The questions—which frequently take the form of hefty accusations—concern not only the flexibility involved with selection criteria, but also the choice of Shanghai. The metropolis was actually chosen to represent all of China, and OECD’s acceptance of the selection did not lack for criticism. Shanghai is in fact one of the richest cities in China, with one of the highest levels of schooling and greater exposure to other cultures. Its inhabitants spend much more than the national average to ensure their children attend the best schools offering the most prestigious professors in order to ensure the most luminous careers. Flaunting Shanghai’s ranking as a victory for all of China and its academic system therefore appears excessive and dense with propaganda. Instead, Asia’s comprehensive success remains intact, celebrated with indisputable superiority from other capitals. It’s another sign of a redistribution of global assets; a phenomenon so important that it doesn’t need the facts stretched or even suspected manipulations.

Raw materials without a market?

Alberto Forchielli - January 6, 2014

Contrary to general entrepreneurial tendencies, Chinese and Russian state-owned enterprises are expanding their activities. In times of delocalization and value chain fragmentation, these giants invest in sectors previously closed to them. If finding factors of production wherever they are available in the best conditions is now fundamental, a new tendency reveals that it’s possible to intervene directly in the supply. This is what’s happening to raw materials, whose prices were dominated by market conditions until now, which is to say by negotiations and distributors. It’s important to note that raw materials are a commodity, therefore a product available on the market, without imbalances, and qualitatively homogenous. The origin is not important, only the availability. Today, things are changing and many clues converge into evidence. The Russia state agency, Rosneft, acquired Morgan Stanley’s commercial oil division on Wall Street last week. Gazprom, the world’s largest gas producer, established two commercial companies in London and Singapore. Deutsche Bank abandoned its raw materials trading activities, while Barclays and JP Morgan significantly reduced theirs. Between contacts and works in progress, the list—reported by Reuters—could continue. The reason for the disengagement must be sought in the restrictions imposed on big banks’ activities after the 2008 crisis and in the importance acquired by producers and users, which is to say by sellers and buyers. Essentially, big Chinese and Russian enterprises want to directly enter business, ensuring and withholding profit margins. They can do this because they have the capital, protection, and political mandates; they control the supply and demand. Between them, sovereign funds play a central role, direct expressions of governments. The control of sales and procurement is decisive. The gulf states intend to sell gas and petroleum at guaranteed margins and China and Japan, Asia’s giant energy consumers, need to be able to buy it at reasonable prices, but most importantly with guaranteed availability. Factories and cities need combustibles, in both the sophisticated Nipponese system and quantitative Chinese model. It’s therefore likely that the pattern will strengthen: governments, their need, and their ability to close deals will increasingly determine the price of raw materials. This will happen via the brokerage of sovereign funds and state companies that operate in supply and demand. It will be a success for emerging countries or players already central to globalization. Their development will no longer—at least in the medium term—depend on western countries’ banks. It will involve a second step forward, after conquering the possibility of using natural resources for internal ends and not only to fuel colonial nations. Now, this second step will tend to reduce intermediation. We will probably witness price fixation on behalf of producing nations’ governments. It would be ironic if globalization allowed the dominance of state-owned enterprises despite the triumph of liberalist principles.

The color—and nationality—of money

Alberto Forchielli - January 13, 2014