Desmond Sham was one of China’s most well-connected businessmen. He and his ex-wife, Duan Weihong, used their relationships with government officials to build a multi-billion dollar real estate development company during the golden age of entrepreneurship that began in the mid-1990s.
Tensions with the West now dominate the debate, with Treasury Secretary Janet Yellen harshly criticizing China’s treatment of US companies during a visit to Beijing this week.
Sham left China in 2015 after President Xi Jinping insisted on greater state control over the country and its companies. Duan, also known as Whitney, disappeared two years later. (Possibly a member of the Communist Party) took her into custody After a high-ranking political official was detained on corruption charges. )
In his 2021 memoir, Sham told the story of their rise and fall, and the darker realities of doing business in China. While many details cannot be independently verified, his role at the intersection of business and politics is certain. He now lives in the UK with his marital son (neither of whom has seen Duan since she disappeared) and says it is not safe to travel to China.
Mr. Sham is scheduled to testify next week. meeting On the challenges faced by US companies doing business in China. This conversation has been condensed and edited for clarity.
What has changed since you published your book?
First, perceptions of China have become more negative. The novel coronavirus has a lot to do with changes in public perception, in particular. This has helped policymakers speed things up in terms of how they deal with China, and they can now ride the wave.
Second, the outside world underestimates how bad the Chinese economy is. During my conversations with Chinese businessmen, a few things struck me. As people buy less milk, big dairy companies are ramping up their powdered milk production. Usually this is the last one he cuts out.
Many executives also say employees have blatantly robbed or stolen from businesses since the pandemic. why? The economic outlook is so bad that they lose hope.
What impact will this have on governance and business?
The government is tightening controls with measures introduced during the pandemic as the Chinese Communist Party’s unrest grows.It’s Affecting Business: Raids and Restricted Access to Due Diligence Firms With Western Ties Winda Chinese data provider, is part of an effort to control foreigners.
How are international companies coordinating?
Companies are overwhelmingly reducing their exposure. People talk about “deglobalization”, but the proper term is “reglobalization minus China”. He is not the only country to replace China, but his business has spread to Vietnam, Indonesia, Sri Lanka, India and more. Let’s see how many Taiwanese manufacturers are expanding into Mexico on a large scale. And in Europe we have friendshoring and nearshoring.
Does the US message — willing to maintain dialogue but negotiating tough — complicate matters?
After four years of the Trump administration and three years of the Biden administration, there is general coherence in China policy. A slight change or shift in tone does not affect China’s perception that the US view of China is fixed. Some tensions need to be eased to restore corporate confidence and attract more capital. If U.S. measures can be eased or delayed, they want to.