Foreign business and the Chinese Communist Party - additional stress to US-China commercial relations

It is widely agreed by foreign multinational corporations operating in China that the Chinese Communist Party (CCP) is strengthening its influence — often gaining direct decision-making power — over the international firms doing business in China.

CCP officials are increasingly calling on companies to support the creation of party organizations among their employees. The potential for party groups to influence corporate decision making has raised concern among many US company executives - such an environment is only adding more stress to the US-China commercial relationship.

Since taking power, Xi has reasserted the CCP's supremacy, with himself as its “core” leader. This has meant greater control over personnel and strategy at state-owned enterprises, which control about 40 percent of the China’s industrial production, as well as schools and universities. Xi’s chief policy-making instrument has been an increasing array of party “leading small groups,” which set and coordinate policy. 

Foreign companies are concerned about the establishment of a party unit in a foreign company and what this means should the CCP play a broader role in foreign companies’ operational decision making. For example, making decisions which are political rather than for business reasons. 

No doubt American business is telling the Trump administration such moves by the CCP into potential management roles of foreign-invested enterprises is not a positive step for the commercial relationship. 

Should the current trade irritation between China and the United States worsen, Beijing could be moved to intensify the party’s role in foreign business further, even allowing the boycotting of American goods and services, creating yet more headaches for businesses operating in China.

This real time business environment has put American companies in particular in the middle of a brewing fight between Beijing and Washington.

Enjoy the ride.

-Marc A. Ross

Marc A. Ross is the founder of Caracal Global and specializes in global communications and thought leader management at the intersection of politics, policy, and profits. Working with boardrooms and C-Suite executives from multinational corporations, trade associations, and disruptive startups, Marc helps business leaders navigate globalization, disruption, and American politics.

The 5G race: China and South Korea are winning

The 5G race is being won by China and South Korea, according to a report conducted by research firm Analysys Mason and released today by CTIA, America's premier wireless industry association.

According to the research, China is in the lead, followed by South Korea, the U.S. and Japan. Germany, the U.K. and France are in the second tier of countries in terms of readiness.

America lags in “5G readiness” due to reliance on private providers -- Verizon, AT&T, T-Mobile and Sprint -- to build antenna infrastructure. China’s wireless providers, on the other hand, are streamlined by government mandate. 

Why this matters - 5G systems support 1k more devices per meter than 4G, using higher frequencies and secondary antennae to relay signals. It also eliminates the transmission inconsistencies and slowdowns caused by buildings, mountains, and crowds.

The global competition is propelling 5G development much faster than was originally expected, with carriers and some cities moving quickly to install infrastructure, said CTIA president and CEO Meredith Attwell Baker, a former FCC commissioner.

The Trump administration see this situation as a threat, especially from China.

Last month the administration blocked Broadcom's proposed buyout of Qualcomm on national security grounds. The administration also fears that Broadcom's business practices would weaken Qualcomm's and the U.S.'s 5G position — allowing Huawei a bigger advantage.

Key findings by Analysys Mason include:

All major Chinese providers have committed to specific launch dates and the government has committed to at least 100 MHz of mid-band spectrum and 2,000 MHz of high-band spectrum for each wireless provider.

Countries around the world are moving quickly to make spectrum available for 5G. This year alone, the U.K., Spain, and Italy are all holding 5G spectrum auctions.

At the end of 2018, the U.S. will rank sixth out of the 10 countries in mid-band (3–24GHz) spectrum availability, a critical band for 5G. The U.S. joins Russia and Canada as the only countries currently without announced plans to allocate mid-band spectrum on an exclusive basis to mobile by the end of 2020.

Countries like the U.K. and regions like the European Union are taking significant steps to modernize infrastructure rules to facilitate the deployment of 5G networks.

Read can read the report here: http://bit.ly/2HFbTqA

-Marc A. Ross

Marc A. Ross is the founder of Caracal Global and specializes in global communications and thought leader management at the intersection of politics, policy, and profits. Working with boardrooms and C-Suite executives from multinational corporations, trade associations, and disruptive startups, Marc helps business leaders navigate globalization, disruption, and American politics.

Go back to school

One of the best thought leader, low hanging fruit techniques is to get reconnected to your school - be it high school, college, or graduate. 

You need your schools.

Over the last few days, I have been down in Chapel Hill, North Carolina attending alumni weekend festivities for the Kenan-Flagler Business School. I was fortunate to be asked to speak with two marketing classes of current students on the intersection of the retail sector and public policy as well as lead a lecture on retail disruption for the alumni back on campus. You can see the decks here: retail politics and retail disruption.

Talking with students as they are about to embark on their careers is a fantastic opportunity. To answer their questions and share your experience I find to be a most wonderful exchange for all involved. Also, you need to be on your game as your audience has immediate access to the WWW to challenge your ideas in real-time, or worse, you are white noise as they tune you out, so they update their Pinterest pages.

Speaking with the alumni, be it 2017 MBA graduates not even 365 days out of college, or older students who departed the school in the 80s, 70s, and even 60s can't be beaten as a venue to present your ideas. This type of cross-generation audience fosters an exchange of experience and knowledge that is a challenge to replicate on a daily workday.

As you think about upping your thought leadership game as a means to improve your experience and knowledge, think about going back to school. Reach out to that alumni director, speak with a former teacher, or find conference taking place on campus.

The ability to share ideas, speak with students, engage alumni from decades past in a safe and friendly environment is a powerful tool that will help you expand your thought leader capabilities. 

-Marc A. Ross

Marc A. Ross is the founder of Caracal Global and specializes in global communications and thought leader management at the intersection of politics, policy, and profits. Working with boardrooms and C-Suite executives from multinational corporations, trade associations, and disruptive startups, Marc helps business leaders navigate globalization, disruption, and American politics.