by Paul Herbig

Created on: May 15, 2009

MARKETING INSIDE THE DRAGON, DESPITE CHINA'S BUREAUCRACY

As more foreign businesses invest in China, there will, of course, be increased marketing opportunities there. But while China's current government continues to encourage foreign investment, the future holds some political uncertainties. The vast country has the opportunity to become a supereconomic power in the distant future, but their government must lead the way, and not scare off potential investors.

Introduction
The sleeping dragon has awaken. And after its long hibernation, it has grown and attracted considerable attention from those outside of its domestic borders. Business Week (May 17, 1993) has called China "the emerging economic powerhouse of the 21st century," and for good reason (p. 54). With a population of 1.17 billion people and a land mass covering 3,692,244 square miles, all kinds of business opportunities exist. China is an agrarian, semi-industrial country with a centralized political structure. All international business associated with the Chinese is influenced and shaped by these factors. China, while rich on manpower, also has the world's largest hydroelectric potential and coal reserves. In addition, it has vast reserves of iron, petroleum, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, and uranium.
For many years, China's foreign trade policy was one with strict self-reliance, importing only necessities while exporting surplus domestic production to pay for it. By the late-1970s, political party leaders started to link the growth of the domestic economy to an increase in foreign trade. For the past century, foreigners have been trying to pry open the door to the Chinese market. It was in 1978 when Deng Xiaoping opened China's doors to the rest of the world and revealed that his country most of everything but its people could not afford much of anything. A decade and a half later, per capita income is still only about $350 per year [$2,656 when adjusted for purchasing power (Political Risk Yearbook, 1993)], although much higher in large cities, and millions of people are moonlighting outside the state system. In the 1980s, China was cautiously considered the new frontier in world trade.
But being viewed as a new trading frontier does not mean that manufacturing and marketing in China is simple. On the contrary, companies still face bewildering bureaucracies; dealing with the numerous ministries and various

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