Slashdot Mirror
Chinese Intellectual Property Acquisition Tactics Exposed
hackingbear writes "In an interview published in Sina.com.cn, Chinese rail engineers gave a detailed account of the history, motivation, and technologies behind the Chinese high-speed rail system. More interestingly, they blatantly revealed the strategies and tactics used in acquiring high-speed rail tech from foreign companies (Google translation of Chinese original). At the beginning, China developed its own high-speed rail system known as the Chinese Star, which achieved a test speed of 320km/h; but the system was not considered reliable or stable enough for operation. So China decided to import the technologies. The leaders instructed, 'The goal of the project is to boost our economy, not theirs.' A key strategy employed is divide-and-conquer: by dividing up the technologies of the system and importing multiple different technologies across different companies, it ensures no single country or company has total control. 'What we do is to exchange market for technologies. The negotiation was led by the Ministry of Railway [against industry alliances of the exporting countries]. This uniform executive power gave China huge advantage in negotiations,' said Wu Junrong, 'If we don't give in, they have no choice. They all want a piece of our huge high speed rail project.' For example, [Chinese locomotive train] CRH2 is based on Japanese tech, CRH3 on German tech, and CRH5 on French tech, all retrofit for Chinese rail standards. Another strategy is buy-to-build. The first three trains were imported as a whole; the second three were assembled with imported parts; subsequent trains contain more and more Chinese made parts."
This sounds to me more like savvy business wheeling and dealing. It's no different than what the Indians, Japanese or Koreans would do.
The story is not that the Chinese are devious, acquisitive SOB's. It's that the west continues to be stupid enough to enable them. http://online.wsj.com/article/SB10001424052748704679204575646472655698844.html Frist post!
an ill wind that blows no good
Well this is the difference between a state that has long term goals of improving it countries vs. corporations that can't see beyond the next quarterly report. Maybe it is true what they say, a capitalist will sell you the rope that you will use to hang him.
Well everyone in the 1980s thought Japan would rule the world and own everything but internal problems proved that there were limits to their power... just as any nation has limits. We in the US often forget our own limitations because we're used to having our own way.
China has severe internal issues; a massive property bubble that makes the US housing crisis seem tame by comparison; local governments are addicted to land sales to fund their massive infrastructure projects, loaded down with loans from the state banks. Unless you truly believe that empty apartment blocks or even empty cities are a good investment and property prices will always go up that game has to end at some point and when it does China won't be able to hide the pain. Plus massive corruption and cheating (how can you make decisions at the top when all your stats are based on outright falsified data?). Official government statistics say that about 40% of the academic papers published from Chinese Universities contain falsified research and that's just what they will admit.
Did I also mention the leadership/succession problem? How many times in world history has some political succession BS thrown a wrench into a country's previously bright future?
I'll put it another way: if China gets too annoying and the EU+US slap a 50% tariff on Chinese imports who do you think will blink first? The consumers who have to pay $5.99 for that plastic toy instead of $2.99? Or the communist authorities in China facing millions of unemployed laborers with no job prospects, nowhere to go, and nothing to do? The political situation in China is far less straightforward and stable than people suppose.
Natural != (nontoxic || beneficial)
Ridiculous. The negative side of China's rise to power is not the color of their skin, but the dismissal of human rights by their federal government.
> this is the difference between a state that has long term goals of improving it countr[y] vs.
> corporations that can't see beyond the next quarterly report.
***China is an elephant that can fly!***
This planet has never seen such an _economic_ rise, not post WWII Europe, not even 20th century USA with its post-war advantage of a devastated first world manufacturing base whilst its own plant was ascendant.
The USA's economic orthodoxy is that attenuated (save Tea Party, Rep. Ron Paul, right wing Republicans) laissez faire, minimal market regulation, minimal market interference, no industrial policy will lead to maximum national economic gains. Since Deng Xiaoping's 1972 market/China opening China has amalgamated Japan's MITI approach (industrial policy) with the West's form of capitalism. In essence they are _demonstrating_ that there is more than one form of capitalism. And their form kicks ass, to the chagrin of western economists and politicos. These Chinese market tactics are if not identical wholly descendant from 1980's Japan Golden Age[1].
BTW, contrary to your quote above, Japan is an economy legendary for putting the long term above ALL ELSE. Yet since 1990 Japan has been in an economic depression that shattered the once indomitable, invulnerable, invincible myth that once was a nation of "Samurai businessmen." I frankly am very surprised at how low Japan's business savvy has sunk. Once upon a time called the 1980s, Japan would do the same sort of thing as in the OP, it would diversify its supply of commodities (1.) to eliminate supplier supremacy and (2.) to achieve lower prices and (3.) gain influence. So, if it needed iron ore, copper ore, petroleum, aluminium, whatever it would set rival nation suppliers against one another---say, Australia, New Zealand, South Africa, Chile, the USA! whomever---for fractional supply quantities. Thusly, low economies of scale would lead to higher cost for Japan, initially, but no one supplier had a stranglehold on Japan. Two, Eventually suppliers would plead for bigger market shares with lower prices for the booming Japanese economy. Three, nations would enact laws beneficial to Japan, nations' indigenous corporations would lobby their governments for infrastructure projects in an effort to ingratiate themselves for future Japanese business or to supply the commodities needed for said infrastructure projects, etc. But now I see that Japan, like the rest of teh globe is a decade away from weaning themselves away from and is presently on bended knee kowtowing to China for rare earth exports. THAT! gentlemen would never have happened to the 1980s Japan. The master is getting tutored!
So I remind you that ***China is an elephant that can fly!***
The planet has never seen a nation rise from so low ECONOMICALLY to so high. Mind you the Middle Kingdom (China) is a nation of deep cultural depth. Reaching back millenia! They are not they were not ignorant not last century, not two three centuries ago either. Think of the Communist Party as the last in a succession of Emperors. China has had them all along its history, some have lasted centuries, some have lasted fifty to ninety years, some have not even been Chinese but barbarian. The communist nation is only sixty-two years old. Their modern ascendancy is thirty-nine years old. Will it last? Will it keep flying? Will the Chinese subsume their liberty to the Party for another sixty-two or thirty-nine years? Even Japan looked unstoppable. Once. It makes an omelet out of our American, western, libertarian, Tea Party, Austrian Economic school orthodoxy.
[1] "Dogs and Demons: tales for the dark side of Japan", Alex Kerr, 2001. A never seen analysis (by a long time nipponophile) in the western press on the cultural, economic, spiritual, ecological malaise of Japan.
Comment removed based on user account deletion
Whatever fault and atrocity US may have committed, anyone in the world is free to criticize and any US resident is free to discuss and lobby for change. The same cannot be said for China and that is fundamental difference between China and the rest of the free world.
I disagree strong with the Patriot Act, the use of torture and the Iraq War, but even I know that those actions pale in comparison to the tens of millions if not hundred of millions of Chinese that perished in the last 50 years due to the ineptness of an authoritarian regime.
While China certainly has achieve spectacular economic growth in the last 50 years, but I would argue that the US civil rights movement that continues today has far more importance than avoiding starvation.