Before entering the seemingly lucrative Chinese market,
investors should be aware of the darkside of the current business
environment. The risk of rampant corruption, economic, social and
political problems, and threat to personal safety go along with the
potential benefits of a thriving economy, rapid growth and swelling
consumer demand. Dixon and Newman describe the Chinese business
environment and its major players--the People's Liberation Army,
the 'princelings'--and 'guanxi' (connections). In addition, they
describe the plight of foreign business people who have recently
found themselves in ugly personal situations because of China's
lack of internationally accepted business practices and ethics,
lack of institutionalized rule of law, and lack of an impartial law
enforcement system. They conclude that any prospective business
rewards must be discounted by the personal and personnel risks
foreign businesses face when dealing with China.
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