In this episode of The Negotiation, we have the distinct honor of speaking with Mr. James McGregor. James is an American author, journalist, and businessman who has lived in China for more than 25 years. He currently sits as chairman of APCO Worldwide, Greater China. A professional speaker and commentator who specializes in China’s business, politics, and society, he regularly appears in the media to discuss China-related topics. Mr. McGregor’s books include "No Ancient Wisdom, No Followers: The Challenges of Chinese Authoritarian Capitalism" (2012) and "One Billion Customers: Lessons from the Front Lines of Doing Business in China" (2005). He also wrote the 2010 report "China’s Drive for ‘Indigenous Innovation’ – A Web of Industrial Policies." We covered a lot of ground during our chat, touching on topics such as insider insights into China’s business environment, how China’s education system prepares its students for today’s working world, the belt and road initiative, what we can take from the evolution of China’s business landscape and how the democratization of the internet has played a role in that over the last 12 years, and of course, we talk about the hottest topic of the week, TikTok and WeChat’s futures in the USA. Enjoy!
Today on The Negotiation, we speak with James McGregor, author, journalist, and Chairman of APCO Worldwide, Greater China.
WeChat is the most popular social media platform in China and has over 19 million users in the US, many of whom are Chinese-Americans who use the app to stay in touch with families back in China. A number of American companies based in China do transactions through the platform as well. To James, these are some of the reasons why the current administration’s decision to ban WeChat is short-sighted. However, he also acknowledges that the Chinese government uses WeChat for propagandistic purposes. “The diaspora,” James says, “get their news on WeChat, and it is all government-sanctioned. That is also fairly insidious.”
Regarding TikTok, James does not see how a video-sharing app whose users are primarily teenagers and those in their early 20s can be a potential national security threat. However, he is aware that, because the app was developed in China, there is a level of distrust regarding data privacy. This has led to the Trump administration forcing a sale of TikTok’s US operations which, according to James, sets a troubling precedent. “Are we making America great again with a great firewall? Are we becoming China in the way we do things in order to fight off China?”
In the early days, Western countries, especially America, had a tendency to be overconfident when establishing a business in other countries. This was a “suicidal” attitude when it came to entering the Chinese market. In more recent times, America has “adapted and learned” and is now “doing pretty well” in China. However, when the WTO opened in the mid-2000s, China began to worry about the amount of traction that foreign companies were getting in their country, prompting them to push back by reforming Chinese companies and closing foreign ones. The relationship between the two superpowers has remained tense ever since.
A stark difference between US and Chinese companies is that the former tends to focus on risk while the latter focuses on the opportunity. “We have been rich for too long,” says James. “And because of that, we have lost a lot of our flexibility and entrepreneurial drive.” He says, however, that while Communist policies suppress innovation in China, globalization and the speed at which the business moves in the country make it a formidable economic force on the world stage. “You can’t block China, so compete with them.”