If one read the news or listened to coverage of the pro-democracy demonstrations in Hong Kong one could readily imagine that Hong Kong demonstrators were fighting to maintain their right of universal suffrage long held during the many years Hong Kong was a British colony.  The debate is portrayed as a simple one.  Students are fighting to maintain their right to elect the Hong Kong executive through universal suffrage while Communist China is seeking to impose an election restricted to a choice between candidates selected by Beijing–an election in name only.

Nothing could be further from the truth.  As a British Colony Hong Kong had no general elections.  The governor and for most of the colonial era, the governing legislative council was appointed by the Crown.  Only briefly during an era after which return of Hong Kong to China in 1997 was agreed to, did the governor of Hong Kong, Chris Patten, introduce reforms that made a majority of his Legislative Council elected officials.  After the 1997 return to China, Hong Kong’s Chief Executive was elected by a Selection Committee who were themselves elected from professional sectors and pro-Chinese business in Hong Kong.

What is under debate is a process for moving Hong Kong to “universal suffrage” by 2017.  This debate has been ongoing since Hong Kong returned to China in 1997 and there are a variety of approaches taken by various interest groups which result in differing degrees of universal suffrage.  At on extreme is Beijing’s proposal that they somehow select candidates from which the citizens of Hong Kong choose.  At the other extreme is the Pro-democracy demonstrators who wish that anyone in Hong Kong, meeting basic qualifications be able to run for office. In many respects the pro-democracy demonstrators are closer to those in Tienanmen in 1989 than they are to traditional Western notions of democratic processes. It is not necessary for us to go into the details of the various proposals here.  But a clearer understanding of the issues at stake that make clear that pro-democracy movements in Hong Kong may be more threatening to Beijing than those in 1989 come from discussion of broader Chinese culture.


As important as Beijing is politically, Hong Kong and its surrounding regions are the economic juggernaut driving much of China’s economy.  Diverse demonstrations in many Chinese cities in 1989 while disrupting could not destroy the economy as a shutdown in Hong Kong could.  One-third of China’s direct foreign investment flows through Hong Kong.  A shutdown of Hong Kong’s economy could be devastating.  That China is not a monolithic culture is perhaps even more significant.  China is a cultural hodge podge of “insiders” and “outsiders”.  One has obligations to the “insiders” of ones community and region in comparison to the “outsiders” who are not culturally local.



One way insiders and outsiders are defined is by dialect.  While everyone reads the same Chinese, community is defined by oral communication.  China has many dialects where oral communication in one community cannot be  understood in neighboring communities.  For most of China, Mandarin, the dialect around Beijing, remains the formal language of the educated elites and business.  However, Cantonese, a formal version of the Yue dialect is an official language of Hong Kong and, along with English, is used as the language of business and law in Hong Kong.  Mandarin, and by implication, Beijing, are outsiders.

As the above map indicates, Beijing will be viewed as an outsider by much of South China.  The 1989 Tienanmen pro-democracy demonstrations appeared as insiders protesting against insiders.  But Beijing, as an outsider in South China will find a pro-democracy movement focused in Hong Kong will raise broader cultural issues that many might view as an empire imposing its will on a peripheral subject.  South China cultures which also see Beijing as “outsider” could potentially realign their allegiance in ways that the 1989 pro-democracy movement could not create.  However, Hong Kong will be even more distinctively outside Beijing’s cultural realm in that Hong Kong, unlike it’s mainland Cantonese speaking compatriots, has not adopted the short form of written Chinese that mainland China developed in 1954.  Hong Kong’s written documents use the traditional long form Chinese still in use in Taiwan and a majority of “overseas” Chinese.  Culturally in both their oral and written communications, Hong Kong and Beijing will view the other has outsiders.

Hong Kong as economic influence in South China.  It also has cultural commonality with mainland China on its borders and a substantial region between it and Beijing that culturally might remain at worst indifferent to a struggle for democracy or “local interests” versus national interests.  We might see future cultural battles dealing with the use of short form versus long form written Chinese as Beijing might seek to further standardize Hong Kong Culture.  We may also see an effort from Beijing to impose traditional Mandarin combined with short form written Chinese on Hong Kong’s education system.  The cultural dynamics of the Hong Kong pro-democracy movement will be interesting to watch.



Westerners frequently find it hard to understand the importance of relationship in Chinese communications. Many of my close Chinese friends will tell me that they spend weeks, if not longer, analyzing their communication with a boss or even a coworker to ensure that relationship needs are maintained. Similarly they will carefully analyze communications they receive for hidden meanings. Westerners, on the other hand, see all communication as direct information. A few weeks ago I had a situation with a Chinese counterpart working nearby that illustrates the different perceptions taken by those use to indirect communication with an emphasis on relationship and those of us who communicate information directly.

I was suppose to pick up my friend in my car. Unfortunately that afternoon I had been gardening and had lost my keys. In spite of a couple of hours searching I could not find them so would have to wait until my spouse came home with her keys. No probelem. I would call my friend, tell him I lost my keys and we could arrange to meet somewhere within walking distance, or he could walk the mile or so to my house and we could walk to a nearby restaurant or bar. Our telephone conversation show the difference in perceptions.

Orville: “Hello Kim. I know I was going to pick you up but I’ve lost my keys, so you’ll have to walk over and we can go to the place down the street.”

Kim: “Lost your key? Man, you know its hot out. Did you check that pants you wore yesterday?”

Orville: “Yes. I’m sorry, but they weren’t there.”

Kim: “what about your desk. You are always leaving your keys on your desk?”

Orville: “Yes I checked my pants pocket and my desk. They are no where to be found.”

Kim: “Why don’t you check again. We can meet an hour late.”

Orville: “I already checked twice. The keys are lost.”

Kim: “What about your briefcase? Sometimes you leave things in there.”

Orville: “I’ve already checked my briefcase, searched the house, looked around in the garden. The keys are no where to be found.”

Kim: “I’m sure you’ll find them soon. I will wait for you.”

Orville: “What part of lost do you not understand? I lost my keys and cannot pick you up!”

Kim: “Oh, you really lost your keys. No problem, I can walk. Why are you so angry at me. You were the one who lost the keys.”

The first point that should be obvious to the reader now, is that Kim was not at all sure that “lost my keys” was a factual statement. He presumed it was a statement about relationship and the inconvenience of picking him up.

The second point is that he put forward a formal mechanism ostensibly to help me find my keys, which he was not at all sure were lost. In his mind, this gave me opportunity to “find the keys” and show my commitment to our relationship. At the same time, if the keys were really lost he was doing his best to help me find them. Once he confirmed to his own satisfaction that the keys were really lost, he offered to maintain the relationship by walking over. At the same time, he was frustrated by my frustration that he did not accept the direct information I had proffered. For him, the conversation was never about losing keys. It was about maintaining a harmonious relationship. While for me, the conversation was only information about lost keys. The lost keys became a disturbance in the relationship that had to be smoothed over simply because I never thought about how to tell Kim that I had lost my keys in a way that would not disturb the relationship.

If losing keys can disturb relationships in a culture where relationship is paramount, think about how the facts and functions of business information can tear at relationships. Spending time to understand how information and communication can affect relationship will be critical to anyone doing business in China. For relationship, I should have called Kim and lied. “Hey Kim, I really need to get some exercise. So I’m going to walk over to your office and then lets go to that nifty new restaurant next door.” His reply might have been along the lines. “Sure thing Orville. But you know its hot out. I’ll meet you at the restaurant in forty-five minutes with a cold lemonade waiting for you.” I would have lied, but in this case the direct information was not critical. The “lie” would have maintained the relationship.


Dragon Eagle’s mission is to help the best of America understand and mix well with the best of China. Our success will result in tremendous benefits for both China–the land of the Dragon–and the United States–the land of the Eagle.

China is booming as an economic power. In the last twenty years at least 75 percent of global poverty reduction has occurred in China. In the last thirty years China’s GDP has grown an average of 10 percent per year. China’s economy has become second only to the United States by 2020, the International Monetary Fund predicts that China’s economy will overtake the U.S. economy to become the world’s largest, and therefore most influential, market. China’s growing middle class now exceeds the population of the United States. To most Westerners China appears to be a vast 1.2 billion person market with a rapidly growing middle class such that even a casual business person can easily conclude that doing business in China has the potential for rich rewards. That is until they listen to many American businesses already there.

Dragon’s and Eagle’s do not readily understand each other. Home Depot CFO Carol Toméspokesperson declared, as that Company exited China in 2012 after spending six years trying to enter China’s market ““doing business in China is unusual.” Jeff Immelt, CEO of GE asserted in 2010 “I really worry about China. … I am not sure that in the end they want any of us to win, or any of us to be successful.” When Mattel’s Barbie closed its stores after two years in Shanghai, Mr. Cavender of China Market Research asserted “What it definitely says is that it is a challenging market… for foreign retailers, it is a very hard market to get correct. They either don’t change quickly enough or they are not patient enough to be successful here,”

Chinese culture and business practices are as strange and alien to the typical American business person as many might perceive of business on another planet. Yet too many American business people arrogantly assume that practices that worked in America and in American culture will work in “enlightened cultures” globally. When they fail, they blame the foreign culture when all too often the failure is a result of their inability or unwillingness to adapt to other traditions and ways of doing business. China has a grand history with Daoist and Confucian values as deeply embedded in its culture as Christian and Enlightenment values are in much of the West.

Even though China is NOT a monolithic 1.2 billion person market, when Western businesses do not succumb to an “American way or the highway” business arrogance there are great opportunities. But most, deeply immersed in American business culture, need guides to prevent them from becoming a stranger in a strange land. The complex differences and cultural subtleties required for doing business in China can be overwhelming. Those complexities are enhanced because China is also a nation in flux. One must do more than simply learn the business principles of guanxi, renqing, li and keqi to be ready to succeed in China. (A discussion of these terms will appear in our ongoing blog) Understanding these terms will tell you how to act properly, they will not necessarily tell you what decisions will work best. Nor will they teach you how to acquire information needed for business decisions in a culture where providing negative information means a loss of face. For that you will need a relatively deep understanding of Chinese cultures (Yes, there is more than one) and history. You will need to understand that translating English into Mandarin can and will change meaning potentially in both positive and negative ways and that key words, even when both parties are using English, will carry significantly different baggage for someone from China than for someone from the US.

Dragon Eagle cannot guarantee success in your cross cultural business ventures with Asia. But we can and will show you paths that can increase your chances of success and help you avoid habits that may work well in America but could doom you to failure in China. We can help you navigate cultural tensions where practices deemed questionable or even unethical in one culture are widely accepted in the other. A Chinese legal scholar once said about the difference between America and China: “In America, ‘rule of law’ is your culture. In China culture is our ‘rule of law.’” Getting it right is a balancing act that each business will need to work out for themselves. Dragon Eagle can show you the ropes, helping you to understand Chinese culture and its implications for your business.

Dragon Eagle in its blogs and other services will

Help you develop the business relationships that are fundamental to your business survival in China

Prevent you from offending your business partners and/or customers through actions and use of symbols innocuous in America but which carry negative connotations in China.

Help you read the “inscrutable” Chinese. The fact that Chinese and most Asians provide much critical information in an indirect fashion can be frustrating, but you only need to know what to look for and what to do to get information critical to doing business and developing relationships.

I hope you enjoy and learn from the Dragon Eagle blog. Please contact me, Dr. Orville R. Butler (Orville at Dragon-Eagle dot com) if you would like more in depth training or advice. We are here to help China and America better understand each other and to profit through that understanding.