An interview with CKGSB Founding Dean Xiang Bing, in the Korea Economic Daily.
Despite China’s extraordinary economic advances during the past three decades, there have been a number of criticisms on China’s relatively poor business environment. Dean Xiang Bing, the Founding Dean of CKGSB, explained that China’s economy is in fact far more open than most people think. The amount of FDI (Foreign Direct investment) works as a good proxy to show this. Dean Xiang claimed that China’s development model is more unique than any other countries, thanks to the open economy that made the fusion of diverse, challenging elements possible, and which established the unique characteristics of the Chinese economy. Dean Xiang said that there is room for improvement in many areas in which China can attempt to make it easier for both foreign and domestic private enterprises to conduct business in China.
With regards to China’s current economic development model transition from an export-driven to a consumption-based economy, Dean Xiang is fairly optimistic. Having the world’s 1st or 2nd largest domestic market, a lower urbanization rate, and extensive experience with different economic and political models all contribute to China’s economic transformation and adaptation. However, Dean Xiang mentioned that several challenges exist as well. In addition to issues of income and wealth disparity, lack of sustainable growth, copycats, and a vulnerable domestic consumption market, Dean Xiang highlighted the current export-driven economy to be the greatest challenge above all. He argued that China can no longer depend on the export market while all of the developed economies are still suffering from sluggish growth and a high unemployment rate. Dean Xiang argued that only through “inclusive development”, with the enhanced purchasing power of the middle and lower income groups, can China achieve stronger domestic consumption to support the future growth of the Chinese economy.
Regarding the role of SOEs (State-Owned-Enterprise), Dean Xiang does not agree that SOEs are the root of inefficiency and corruption in the Chinese economy since SOEs have their own significant role in the development and implementation of China’s economy. Dean Xiang also mentioned that the recent policies from the central government have signaled that further reform of SOEs will continue to go ahead. The aim of such reform is to make the SOEs more competitive in the global market.
Dean Xiang chose Huawei, the 2nd largest telecommunications equipment manufacturer and services company as China’s leading representative of a global company. Lenovo, Geely Automotive Holdings, and Wanda Productions were also highlighted as leading global corporations. Dean Xiang said that China has been internationalized during the last 30 years and now it is time for the world to be sinicized during the next 30 years. As a response to the criticisms of Chinese companies competitiveness as global player,s Dean Xiang explained that the domestic market in China is differentiated from that of other countries. He claimed that there are several ways for Chinese companies to grow up as global players. In other words, based on the immense influence of the Chinese domestic consumption market over the global economy, Chinese companies can grow up to a global standard by managing the domestic market. Regarding the recent series of corporate collapses such as Nokia’s, Dean Xiang claimed that not every company can be successful in the face of intense competition and they should to be fortunate enough to survive, which is out of corporate control.
Commenting on corporate social responsibility, Dean Xiang mentioned that large conglomerates should take much more responsibility in terms of income and wealth distribution and job creation. Failing to meet the standard may cause social instability.
Meanwhile, Dean Xiang said that CKGSB is differentiated from business schools in Western countries for several reasons. Modern management education started in the West, so it’s important that the educational backgrounds of the CKGSB faculty are from prominent business schools such as Columbia, Harvard, Stanford and Wharton. With China’s re-emergence, CKGSB has established itself as a leader on the knowledge exchange between the East and the West. Governed by the world-class faculty who combine first-hand knowledge of China with a firm grounding in Western business theory and practice, Dean Xiang believes the next decade will allow CKGSB to serve as a key driving force in innovating global management education and become one of the most prominent business schools in the world.
Please read the full interview in Korean on the Korea Economic Daily website.