The face of public diplomacy

Zhao Qizheng is out there getting China's message across every day through better communication

Many Chinese companies dismally fail the test of diplomacy when they go abroad, says Zhao Qizheng, former chairman of the foreign affairs committee of China's top political advisory body.

Not only do they act clumsily, but they also have little understanding of the concept of public diplomacy, says Zhao, who is widely regarded as a pioneer in Chinese public diplomacy.

"We've done research on Chinese companies going overseas and found that many businessmen are good at talking business, but not at social dialogue," Zhao says in an interview in which his famed ability to speak with razor-sharp succinctness and clarity are on full display.

Chinese businesses often operate overseas exactly as they do in China, overlooking cultural differences, which can cause problems, he says.

Definitions of the term public diplomacy are many and varied, but for Zhao, in practice for China it means helping the rest of the world at all levels, including individuals and business, understand the country.

Zhao, author of Public Diplomacy in World Business, his latest book which has just been published, and also a manual for companies that do business overseas, or aim to do so, says that after decades of rapid development, Chinese companies are perfectly placed to target global markets, and overseas investment is going to surge.

"China's GDP accounts for about 10 percent of world GDP, and its direct overseas investment accounts for about 3.2 percent of the world's, a gap that represents great potential for Chinese companies to go global," Zhao said at a recent forum in Beijing on public diplomacy. In 2013, China's outbound direct investment increased by 16.8 percent to $90.17 billion (65.57 billion euros), according to Chinese Ministry of Commerce figures.

Against that background, Chinese entrepreneurs have become important torchbearers in the world of public diplomacy, and it is crucial that they equip themselves with the skills that public diplomacy demands says Zhao, who, as the minister of the State Council Information Office between 1998 and 2005, helped refine the government news-release system.

That means that when they conduct business in other countries they should represent China and be able to tell its "stories".

"As a result of globalization, many people, particularly businessmen, may well feel that a country's international reputation will have a direct bearing on the kinds of things it can do. If foreigners think Chinese are not credible, that will affect the perceived credit worthiness of Chinese businessmen in overseas lending markets.

"You cannot separate culture and people. When Chinese entrepreneurs do business with the world, their behavior, products and after-sales service all symbolize Chinese culture and provide a window for foreigners to understand China. Whether they succeed or fail, they are representatives of China."

Before becoming involved in public administration, Zhao, 74, was a nuclear physicist. From 1984 he was appointed to important positions in Shanghai, including that of vice-mayor, and played a crucial role in developing Pudong, now a symbol worldwide of China's modernization. It was in working on the Pudong project that he became keenly aware of the importance of public diplomacy.

"Ever since the reform and opening-up of China, the positions I have held were closely related to public diplomacy," he told China Central Television in 2012. "I received many foreign leaders, leaders of multinational companies and reporters from major media around the world. I would explain to them the policies of China's reform and opening-up and the investment environment of Shanghai. That was public diplomacy."

Zhao says that for the past 30 years China has attracted a lot of foreign investment, and many foreign companies have been well received in the country and had great success. However, when Chinese businesses have traveled in the opposite direction, the results have often not been so good.

In his book, he looks at case studies of companies investing overseas, some successfully and some not, and finds that apart from economic conflicts between both parties, problems are often the result of ignorance about cultural differences. In some cases, government and public misunderstandings or sheer prejudice exacerbated by poor company behavior are to blame, he says. That could be something as general as ignorance of local customs or something specific such as not paying workers full wages or delaying paying them.

As an example of a company being attuned to local customs he cites Lu Weiguang, president of A & W Woods, an international wood flooring company with headquarters in Shanghai. When Lu announced that he planned to start operations in Brazil, someone jokingly suggested that if he wanted to do business there he would need to first lay down a soccer field.

Lu took the suggestion to heart and laid down a soccer field, and let staff take time off once a week to play. He and his business were thus able to get to know local people and integrate into the community, and his business thrived.

Zhao says: "If Chinese companies focus only on business investment activities, if they cannot communicate smoothly with target markets' governments, media and social organizations, if they cannot recognize international political situations and avoid risks, or successfully deal with criticism, all those will lead to business failure."

Thankfully, some Chinese business people have become aware of the importance of public diplomacy, Zhao says. More than a dozen public diplomacy associations have been set up in China, and many businessmen are highly active in the field.

Nevertheless, such people are still the great minority, Zhao says, adding that when he was writing his book and asked some companies to tell him their stories they passively responded, just because they did not understand the meaning of the request.

Zhao says that change never stops, and that China is still at the primary stage of going global.

"Many Chinese business people don't know much about other countries, partly because of different languages, culture and market systems. There is a lot to learn. So companies cannot just blindly go overseas. They need to do a lot of homework first, such as finding out about other companies that have done well overseas, and get training from people well versed in international operations."

To that end, Zhao, now also the dean of the School of Journalism and Communication of Renmin University of China, says that some training schools and institutes devoted to public diplomacy and allied subjects are being set up in China. On Feb 26, the university, in Beijing, founded a research institute on public diplomacy, with Zhao the president. He has also written more than 20 books sharing his thoughts about public diplomacy.

Zhao has advice for companies that want to go global. Businessmen can apply principles to every country, he says, such as being aware of local laws and regulations and of local traditions and religion, but each company needs to communicate with different countries in the appropriate way.

"In the Western world when Chinese companies are challenged or are talked about with suspicion, we should argue on the basis of reason and confront the situation directly through the media and political bodies. You can't just stand there and say nothing, which only guarantees failure.

"In dealing with less-developed countries, showing respect is absolutely essential. We cannot lower the bar, or be seen to be doing so, which can cause misunderstandings. Any difference in the way we treat, say, the US, and any African country, is bad public diplomacy."

Moreover, while doing business overseas, companies should also be aware of how much social responsibility they are able to shoulder.

"Taking social responsibility will mean smaller profits, so entrepreneurs should be careful when talking about the issue in negotiations and think about the responsibilities they will need to bear."

As more small and medium-sized companies also go overseas, he suggests they form associations so they can help one another or get assistance from chambers of commerce.

"In no country is it easy for small and medium-sized companies to go abroad. Companies that reckon they can go overseas need to consider carefully where they go. Developed countries may be a poor destination for them; perhaps there may be more opportunities in developing countries."

Contact the writers through chenyingqun@chinadaily.com.cn

( China Daily Africa Weekly 03/07/2014 page32)