kendo

China Trip
kendo posted in Uncategorized on July 3rd, 2006

Nostalgia:

The first day in Beijing, I felt a bit down after leaving Vietnam. However, I’m sure the pain would have been more acute had I returned directly to the U.S. Instead, the culture shock of visiting another country has fully occupied my thoughts and senses.

Language:

Interestingly, everyone here thinks I look Chinese. Blending in has its advantages and disadvantages. As a positive, I’m less likely to be a target for tourist scams and pickpockets. On the downside, communication is a big issue. Not many people outside the large hotels and tourist centers can speak English, and it usually gets worse the further out you go.

People get confused or disappointed when they discover I can’t speak the language, . As a result, I get to feel like a retard with virtually every social interaction I have with the Chinese. Ironically, this is the opposite of how I felt in Vietnam. There, everyone thought I looked Korean or Japanese (my guess is because the largest foreign investors in Vietnam are Korean and Japanese, and Korean soap operas and movies appear to be more popular than their Chinese equivalents). As a result, when it turned out that I was able to speak Vietnamese, people were usually both surprised or impressed.

Although the ethnic mix-up is certainly annoying, it’s perfectly logical once you think about it. The parallel experience in the U.S. would be meeting a white guy that only knew how to speak Chinese. And, the situation would get more unusual the further you moved away from the more cosmopolitan coastal cities like NYC and SF, to say, Boise Idaho. Same thing happened when I moved from Beijing/Shanghai to Chongqing, which is a western in-land city with lower rates of tourism and FDI penetration (and therefore exposure to foreigners and emphasis on English in education, business, etc.).

After the first two days, I found my way to a foreign language bookstore and got my hands on the Lonely Planet Mandarin phrase book. The book is extremely handy at times. I can reference words I want to use in the book’s dictionary, which includes the Chinese character translations as well. This is particularly effective for simple social interactions with taxi drivers, waiters, etc. However, the book doesn’t allow for two-way conversations; the worst thing is when I get a follow-up question. Sometimes I get into a cab armed with the address of where I want to go (i.e. a popular nightclub). However, instead of immediately starting off, the driver asks me something else in Chinese about the address. My first tactic is to ignore the question or even mumble something unintelligible in hopes that 1) he is making a side comment about the weather or something, or 2) he will make the decision for me if the question isn’t that important – like determining whether a tunnel or bridge is the faster route. However, if the question is repeated after a few seconds of silence and there is still no driving, I have a problem. Is it the wrong address? Is my handwriting too messy? Beats the hell out of me, and I usually have no choice but to awkwardly exit the conversation; in this case it means getting out of the cab.

At other times, I’ve had to resort to drawing pictograms or even acting out what it is that I want. It’s like a ridiculous game of Charades: literally. What’s most pathetic is when even this doesn’t work in communicating what I want. In situations like this, it’s hard not to get frustrated.

I lost motivation to try speaking Mandarin during the course of my trip. The peak of my interest was in Beijing and Xi’an, then fell off in Lhasa, where they speak Tibetan. In Chongqing, Shanghai, Guilin, the Chinese speak different dialects (same written language, but the pronunciation is different), while in Guangzhou, they speak Cantonese (which is significantly different in pronunciation from Mandarin).

Traveling through China has further reinforced how grateful I am that English is my native tongue and I am a U.S. citizen. One reason is that a U.S. passport affords the greatest freedom of movement across borders. A second reason is I’m not a natural with languages, so I’m glad that the world’s language of business is the one I got for “free”. Imagine if Vietnamese were my native tongue, and I knew only a little bit of English. That kind of language constraint would have made my trip through mainland China extremely difficult.

Clubbing:

I think I must have checked out about thirty different clubs in the seven major cities that I visited. That seems like an unbelievable stat, as it’s an average of more than one per day. However, Chinese clubs don’t charge cover, and a lot of venues are clustered together. So, I did a lot of walking in and out of places just to check out what was going on. China, in my opinion, has a budding clubbing scene, but lacks the presence of distinctive mega-clubs (i.e. Ministry of Sound) that typically exist in the world’s largest cities. Many venues are carbon copies of each other, with similar design (use of lighting, glass, mirrors, etc.), music, business model and crowd. A perfect example of this is the club chain Baby Face, which I ended up going to four times in for different cities: once in Beijing, Xi’an, Shanghai and Guangzhou. It was exactly the same in each place.

The more I travel through the developing world, the more I’ve learned what inferences can probably be drawn about the nightlife in the area I’m visiting. Clubs are a great way to observe social behavior, and are great anecdotal measures of discretionary income. One reason fot this is that clubs are a place that induce people to show off their wealth. In emerging countries, the breadth and depth of venue selection is a good indicator of GDP per capita (alternatively, in developed countries like the U.S., there are more shades of gray, where the venue selection could depend on how “happening” the city is. For example, there’s a big difference between how fun the nightlife is in Miami and Pittsburg, although they are about even in per capita economic terms). You also have to consider a host of other factors, such as the clubs’ occupancy levels, how often they’re open, DJs/music, what types of people are going.

For example, if the clubs are always packed, but the majority of the people going are tourists/expats, prostitutes or mafia members (as is often the case in Hanoi), then a packed house may be more representative of the pervasiveness of social evils in that city than of economic wealth. The local venues are almost always more interesting than the ones typically featured in the Lonely Planet/Fodder’s Guides, as they give you the local flavor (although the presence of foreigners is a good indicator of tourism and Foreign Direct Investment).

It’s also important to consider a country/city’s saving habits. For example, are relatively poor people blowing everything they have on a few nights at the club (a phenomenon similar to spending all ones’ money on cell phones, clothing, motorbikes, cars, in pursuit of symbols of economic status)? Clubs are also a good place to learn about gender equality. Who forks out the dough to pay the bill at the club, and more importantly, who is paying for everything behind the scenes.

Beijing:

The first night I went clubbing in Beijing, I ended up wasting about an hour trying to find a club that had already been closed for three years (bad internet search). The second club I tried was called Xenja, which unfortunately turned out to be a teeny-bopper club with cheesy trance and synthesizer sounds aplenty (by the way, if it’s socially and economically acceptable for younger kids to spend time and money at clubs, that typically indicates a higher level of development, holding other factors things constant). However, as it was already midnight on a Wednesday (with clubs supposedly closing around 2AM), I figured I might as well stick around. When I got to the dance floor, the crowd was packed tightly together bobbing straight up and down with an eerie synchronization. I thought to myself that this could possibly win the prize for the worst dancing I’d ever seen. However, when I stepped on the dance floor, I realized it was actually an elevated platform set on springs. Movement was determined by the crowd’s collective weight. So, despite trying futilely to dance my own dance, I was forced into the same retarded rhythm with the rest of the kids. When I tried to deviate from the collective beat, my knees would buckle as my feet came down while the platform was coming up. Needless to say, I didn’t stay long on the dance floor long.

The second night, I had better luck. I stumbled across the city’s club listings in “What’s Beijing” magazine. That night I rolled out with Linh the French-Vietnamese guy in my group tour. The six clubs or so that we visited were all on the same block. We ended up settling in at a club called Cargo, which had some of the best breakbeats I’ve ever heard. After listening to track after track of slammin beats, my opinion of Beijing’s club/electronic music scene really went up a notch. Perhaps being deprived of real music in Vietnam for two years had something to do with it, but the beats certainly ranked up there with some of the best I’ve heard.

People in Beijing are building wealth at a rapid rate, and you can see that at the clubs. When walking around the streets, I thought to myself that Vietnam has a hell of a way to go in terms of economic development. However, to make a statement about how many years behind one country is from another, you need an apples-to-apples metric like GDP per capita. Otherwise, the scale differential can get mixed up with the development level. For example, Beijing as a city generated as much GDP in 2005 as Vietnam did as an entire country. That gives you a good indication of China’s substantially greater scale (however, NYC generates about 8 times as much GDP as Beijing, with the per capita differential even larger. This shows you how much further China still has to go). On a per capita basis, Saigon is about eight years behind where Beijing is today and 12 years behind Shanghai. However, both Beijing and Shanghai are growing faster than the major Vietnamese cities, so there is no “catch-up” phenomenon to be observed if the two countries are viewed in real time.

Xi’an:

The terracotta warriors here are definitely a must-see when visiting China. It’s amazing that even in the 1st viewing Pit (there are three pits open to the public) that they’ve only excavated maybe 25% of the buried warriors. What’s more, there is a 4th pit that has not even been opened, and possibly more pits that have not even been discovered. The showcase facilities double as research centers for the ongoing excavation, which supposedly occurs at night when the facility is closed to tourists. I’m wondering what the hell is taking so long with the excavation. For students of history, archaeology, ethnology etc. the site could provide a lifetime’s worth of “live” research opportunities. So, I’m surprised why the place wasn’t crawling with researchers. Maybe these things just take more time than I think (or the excavation is being self-funded by tourism receipts or something like that).

I’ve traveled enough to recognize that there are two things I typically like to see: old shit, and things that possess natural beauty. I’ve become a bit of a snob about seeing old things. The first thing I ask my tour guide when I see a tomb, statue, building, etc. is how old it is. If the response is 18th century or something, I sometimes lose interest, thinking to myself, “shit, that ain’t that old”. I’m more forgiving if the site holds considerable historical significance. I also don’t like looking at restorations, although practically speaking, many of the historical sites wouldn’t be around if they weren’t restored over and over again over the years.

Lhasa/Tibet:

I lucked out in Lhasa, as the second day of my stay turned out to be the holiest day of the Buddhist calendar. As a result, I got to see the Sakadawa festival. The festival featured a large migration of monks and Buddhist Tibetans around the three holy circuits of the city. The most fascinating part of the migration was the act of prostration, which involved laying down ones’ body face-flat on the ground with legs and arms outstretched. Pieces of cloth and cardboard were used to protect peoples’ knees and hands as they repeatedly knelt down and used their outstretched hands as sliding supports until their faces touched down to the ground. I was told that some devotees prostrated themselves for kilometers at a time (including what looked to be eighty year-old women). Talk about devotion!

After about twenty-four hours in Lhasa, I started to suffer from Acute Mountain Sickness, which results from ascending to a high elevation without a proper acclimation period (Lhasa is 3700 meters above sea level). The sickness felt very much like a hangover, combined with fatigue and body aches. Climbing the stairs to my hotel room on the fourth floor felt like climbing up a small hill.

I also suffered from sunburn despite applying at least one coat of the powerful 81 SPF sunblock I’d brought along. I guess my natural vulnerability to the sun along with two years of avoiding it in Vietnam (for the ladies who love white skin) resulted in an easy burn. I had resisted the urge to carry an umbrella around during my first two days in Tibet (women are the only ones that carry them). But, by the third day, I threw my reservations and fashion sense out the door.

I decided to probe my tour guide about the political situation in Tibet (Tibet is one of China’s biggest political hot-buttons, ranking behind the Taiwan independence issue). The conversation was very telling. He said he didn’t like Chinese people because they were impolite and used political connections to take business way from Tibetans. Interestingly, I discovered that many of the handicrafts sold by Tibetans were actually made by Chinese (so who knows whether the singing bowls I bought were really made by Tibetans). Talk about cultural erosion. Allegedly, what the Chinese did was replicate what the Tibetans were selling, while producing in bulk and at lower cost. Chinese retailers of Tibetan goods had easier access to cheap supplies via their political connections with Chinese manufacturers so could undersell Tibetans on price.

Cultural strains may only increase as a new railway linkage from neighboring Qinghai province is expected to come online later in 2006. The railway will make the plateau accessible to a massive influx of not just Chinese tourists, but settlers who are slowly taking over the Autonomous Region (Tibetans are a minority in their own region). There are reports that popular sites like the Potala Palace will have to turn away a large number of tourists each day due to overcapacity. It’s also interesting to observe how the Chinese manufacturing behemoth has had the same impact on a simple economy like Tibetan handicrafts as it’s had on the U.S.’ manufacture of cars, software, pharmaceuticals, etc.

Chongqing/Yangtze River Cruise:

Chongqing was the departure city for my Yangtzhe cruise. Unfortunately I hadn’t researched the city much prior to leaving Vietnam. As a result, I missed out on the fact that the city is the most economically dynamic in China’s West. Too bad I didn’t budget more time to explore the city. I had only five hours to roam around before my cruise ship departed. As I ventured through the city, I was surprised to see how developed it was. It had a decent skyline, with more than a handful of tall skyscrapers. The geography reminded me a bit of Manhattan, with brown-colored rivers (due to pollution) on either side of a centrally-located downtown area, and less expensive “boroughs” on the other side of each river (although Chongqing is a Penninsula, while Manhattan is an Island).

I asked the woman that picked me up from the airport to drop me at the main shopping area in the city. Street after street was packed with designer department stores, which in turn, were flooded with customers in the middle of a Wednesday. There were a lot of fashionable looking youngsters, and a pleasantly high number of beautiful women walking around. I noticed only three non-Chinese people (two white, and one black) during my stroll through the city: a record low for any of the Chinese cities I visited ((Shanghai being at the opposite end of the spectrum).

Later on, I did some quick research on Chongqing on the Internet. Sure enough, overall GDP was decent at $33BN, although per capita GDP was still relatively low at $1,250 (roughly one-quarter that of Beijing, and one-fifth that of Shanghai). However, the government is pouring investment into Chongqing in an effort to close the economic gap between the country’s booming coastal cities (i.e. Shanghai) and the less developed cities in the Western interior. The city’s development is tied to the massive Three Gorges Dam project, which is the largest of its kind in the world. The dam is expected to provide a whopping 10% of the entire country’s power (more on the dam in a bit).

My “five-star” boat didn’t look like the white-painted cruise liner I had imagined, but my room was comfortable enough. I paid an extra $80 to get my own room on the fourth floor, which is the highest you on the boat with the best views. About 90% of the passengers were domestic Chinese and spoke very little English. The remaining 10% was comprised of families from England, France, New Zealand, Brazil and the U.S. (there were only three Americans, myself and a couple from Idaho). For meals, passengers were assigned to tables based on language proficiency. Embarrassingly for me, everyone else in the English-speaking group looked the part: white, and mostly 40 and above. So, I had the honor of being the only “Chinese” looking kid sitting at a table of old, white foreigners. Maybe the other passengers thought I was adopted or something.

The second day of the cruise was my birthday. At dinnertime, I was a bit slow to get down to the dining deck. To my surprise, I got a call from the head of hospitality stating that the captain was waiting for me, as it was my special day. Apparently Amy, the woman who had set up my China tour had phoned the cruise boat and instructed them to do something special for me. So, during dinner, I got the whole cake and happy birthday song affair, which was sweet.

The most amazing part of the cruise (and an unexpected bonus) was getting to see the boat pass through the gigantic five-stage shipping lock of the Three Gorges Dam. In aggregate, the boat was brought down about 100 meters during the four-hours it took to pass through the five gates. I only sat through the first gate, as it was already midnight. Five is the largest number of gates for any dam in the world, with the quantity necessary to withstand the massive water pressure created by the considerable depth differential and the dam’s breadth (two kilometers). Amongst other amazing features of the dam will be a ship elevator (still under construction) and downstream spillway mechanisms that can control flooding in the event the dam is attacked, and breached). Seeing the dam has to be one of the most amazing things I saw in China.

Shanghai:

The first thing that struck me about the city (as I entered via taxi at around 8PM) was how beautiful the skyline was. Most of the modern buildings (built within the past fifteen years), of which there are many, have attractive lighting installed on their exteriors. The lighting comes in all kinds of colors and is often programmed to strobe, streak and pulse like the Las Vegas strip. Casino-style lighting even appears on what turn out to be mundane concrete office buildings during the day. This type of lighting is likely encouraged in municipal planning to make the skyline aesthetically pleasing. Even some of the expressways are illuminated with neon blue lighting either on their underbellies or on concrete dividers. On the Bund, there was even a building with red neon lighting framing the entire building and each of its windows. Only upon close inspection did I realize that the lighting was hung on black netting, which in turn, covered the scaffolding of a building that was actually still under construction. Talk about attention to aesthetics.

It’s good that the artificial lighting looks good, because I don’t think you’ll ever get to see stars in the Shanghai sky. When the sun rises, it reveals an ugly smog cloud that appears to perpetually blanket the city. China is reportedly home to 16 of the 20 most polluted cities in the world, and Shanghai is certainly one of them.

With seven other Chinese cities to compare to, I think I can reasonable say that the people in Shanghai are the most unfriendly. The attitude is in effect everywhere: in restaurants, nightclubs, taxis, hotels, etc. Even my tour guide wasn’t that nice. Service with a smile was in short supply, and politeness was distinctly lacking, particularly compared to Beijing. The culture in Shanghai could possibly be compared to that of New York City, with common elements including the hustle bustle of a thriving economy, the climate, and the status as each respective country’s wealthiest city. Both cities are also very cosmopolitan. Shanghai is one of the youngest cities in China, and has been heavily influenced by foreign cultures throughout its development.

I really don’t like cities that lack warmth, so Shanghai probably wouldn’t be at the top of my list if I were to live in China (then again, it’s probably where I would most likely end up because it is developing into the mainland’s financial center). Lack of friendliness may put off some tourists like me, but it’s certainly not required for economic growth. An interesting question is whether Shanghai’s rise will marginalize Hong Kong as the country’s financial services center. This has much to do with the history of Hong Kong as a British colony, and its existing role as a Special Autonomous Region (SAR). Although HK is technically a part of China, it doesn’t have the cultural and political ties that Shanghai does. The Chinese government would be much more proud to see Shanghai, a homegrown mainland city so to speak, become the envy of Asia, and then the world. This all has relevance to me, as I am thinking about returning to Asia after B-school. Hong Kong would be my most likely destination as it pays the most (aside from Tokyo), and would likely have the greatest number of opportunities. It appears that HK’s superior linkage to financing from the rest of the world and its transparent regulatory/legal framework will make it difficult for Shanghai to compete in financial services, at least for now. However, things such as lower-end manufacturing and sea-based shipping are likely to be ceded to the Mainland.

Huangshan Mountain:

Six years ago, I bought four photographs of Chinese landscapes in the San Francisco Chinatown. At the time, I had no idea where those places were (I bought them because they were stunning). Coincidently, both of the locations for those photos – Huangshan Mountain and Guilin – were on my itinerary. The scenery up on the mountain was simply stunning. Unfortunately it is also one of those places that reveal the shortcomings of my digital camera, which never really seems to capture what I’m seeing. I’ll make sure to upgrade my camera before the next long trip.

One thing I noticed about the mountain was the exorbitant cost of its food and accommodation. Prices were more expensive than downtown Shanghai, particular taking into account quality. Some rooms had as many as six beds in order to make them affordable to the local Chinese tourist. When I asked my guide about why this was, he mentioned that we were at the top of a mountain (about 1800 meters above sea level at the summit), and it was expensive both to build accommodation that far up and to get supplies up the mountain. He pointed to the fact that supplies were brought up manually by porters who slaved underneath heavy basket loads connected by a wooden bar slung over the shoulder (similar to what the Vietnamese use in the countryside).

When I saw these guys laboring for kilometers up the mountainside (it was tiring enough just walking), I thought that surely there must be something disrupting the operation of market forces in this mountain economy (i.e. government control, economic mismanagement, etc.). There had to be easier way to get supplies up the hill in this day and age. Plus, prices were way too high. The local guide, who was obviously taken by the strength of the porters and moved by their relative poverty, insisted that it was the best way to move supplies. He insisted on this view even when I suggested alternative ways to improve transport and increase competition for accommodation. His argument was that if Huangshan innovated, the porters would not have jobs and would be unable to feed their families. Of course that’s not a valid argument, but I stopped debating the issue as I recognized it immediately as the classic resistance to change. It is also a symbol of how some people are being left behind by China’s rise, and are even resentful of the progress that is being made in cities such as Shanghai.

Guilin:

People are extremely friendly here, and the scenery is beautiful. I’m sure the two are related, as they are everywhere. I took a boat cruise down the Li river from Guilin to Yangshuo, a small town about 45 minutes away. There, I got to see a show called Impression, which was an amazing production involving over 600 minority performers (the Han Chinese are the dominant ethnicity in China). The Director of the production was the same guy that put together the movie Hero. The performance incorporated a dazzling mix of light, water, and sound. The stage itself was built into a natural lake surrounded by limestone outcroppings for which the region is famous. There were also thunderstorms in the distance, with streaks of lightning adding additional beauty to the production. You have to see it to believe it.

China’s state dominated Airline industry needs a serious upgrade. I took five flights domestically, and all five were late because of “delays from the incoming aircraft”. Since the five flights were to and from all of China’s major cities, I think that’s a good representative indication of how crappy the flight network is. For this reason, it’s likely that HK will maintain dominance over air trade despite the mainland’s efforts to take market share. Sea trade, on the other hand, is likely getting cheap enough in Shanghai and Guangzhou to compensate for any inferior service relative to HK.

Guangzhou:

Similar building lighting to Shanghai, but not very impressive given there’s no skyline. Guangdong is China’s most prosperous province, but the city is not build in a geographically constrained area, so not many skyscrapers, and not many in a condensed location. Very disconnected like L.A. The city had a dirty feel to it, and not just from the pollution. It was the only Chinese city where I remember seeing homeless people (and lots of them), prostitutes actively roaming the street near five-star hotels, which are likely people from the countryside trying to cash in on the boom, but falling short. This is also where I hear stories of massive pickpocketing and scams. It’s also the only place where I remember seeing black people. I have to check again what the story is with that.

Pearl River cruise was fairly boring, possibly a bit anticlimactic due to all the other cruises I’ve been on. Found a shoe brand that’s awesome for dancing. I bought three pairs.

Proud to say I know quite a bit about the history, business, and economy of China. I have a fairly good idea of what skills I will need if I want to do business in the mainland. Anyway, I think the knowledge will be invaluable no matter what given China’s ties to the business I conduct will only continue to grow. So, it’s good to get a head start. It’s also nice to know that China and Vietnam are so, so similar in so many ways. I should make a list. It’s almost like getting the China experience via a step-sister.

China’s state dominated banking system has a long, long way to go. China Construction Bank (CCB), the country’s third largest lender, raised a whopping $8BN via an IPO in 2005 with great fanfare. The other day, I took out 2000 Yuan (about $250) from a CCB ATM. Guess what… it turned out 500 Yuan of that money was counterfeit. Tell me what kind controls does a bank possess if it allows fake money to be distributed through its ATMs? Of course I didn’t keep the printed receipt, since I was leaving the next day. So, I didn’t have time to report the incident and reclaim my money. Although I didn’t have this problem in Beijing, imagine how embarrassing it will be for the country if it gets out that foreign tourists attending the ‘08 Olympic Games are receiving fake money at ATMs.