Tim Clissold - Mr. China: A Memoir

T IM C LISSOLD has worked in China for sixteen years and travelled there extensively. After graduating in Physics from Cambridge University and working in London, Australia and Hong Kong, he developed a fascination with China. He spent two years studying Mandarin Chinese before co-founding a private equity group that invested in China.

Praise for Mr China

Its got big money, charismatic capitalists, Communist apparatchiks, crime and mysterious disappearances the lot. Sadly for author Tim Clissold, though, its not just a novel its true... [But] its not, he insists, an anti-China book, at all... the real butts are the Wall Street types who thought they could crack China without knowing what they were doing.

Richard Spencer, The Daily Telegraph

Hard to put down... delightful for the engaging way in which it details the hardships of any businessman who lives on the road... at the same time a useful lesson for those who think there is anything easy about direct investment in brand-new markets.

Economist

Engaging, extremely well-written and often very funny. An extremely insightful account... we cant recommend Mr China too highly: anyone in business associated with China, however large or small, ought to read it and learn from it.

China-Britain Trade Review

A compelling view of China since Deng set its present course in 1992.

Management Today

Such a good book. It is a must-read... dont leave home, heading for China, without it.

China Economic Review

ROBINSON
London

Constable & Robinson Ltd
3 The Lanchesters
162 Fulham Palace Road
London W6 9ER
www.constablerobinson.com

First published in the UK by Robinson,
an imprint of Constable & Robinson Ltd 2004

This edition 2002
Copyright Tim Clissold, 2004, 2006

The right of Tim Clissold to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988

All rights reserved. This book is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, re-sold, hired out or otherwise circulated in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent purchaser.

A copy of the British Library Cataloguing in Publication data is available from the British Library

ISBN-10: 1-84119-788-2
ISBN-13: 978-1-84119-788-2

Printed and bound in the EU

7 9 10 8

For
Christian, Honor, Max and Sam

A Chinese Chop

The events that I describe in this book actually happened; but this is the story of an adventure, rather than an expose of a particular company and, since it describes circumstances that many foreign investors find in China, I have changed the names of some of the companies, places and people who appear. The main events described took place between 1995 and 2002.

Contents

The idea of China has always exerted a pull on the adventurous type. There is a kind of entrepreneurial Westerner who just cant resist it: red flags, a billion bicycles and the largest untapped market on earth. What more could they want? After the first few visits, they start to feel more in tune and experience the first stirrings of a fatal ambition: the secret hope of becoming the Mr China of their time, the zhongguo tong or Old China Hand with the inside track in the Middle Kingdom. In the end, they all want to be Mr China. They want to be like Marco Polo roaming China as the emissary of the Kublai Khan. Or the first pioneering mill owners lolling about in the opium dens in Shanghai, dreaming of the fortune to be made if every Chinese would add an inch to his shirttails. Kissinger must have felt like Mr China as he schemed against Russia with Zhou Enlai; Edgar Snow may have been the same as he stood on the Gateway of Heavenly Peace with Chairman Mao. And of the countless businessmen who come to China with high hopes of the billion three market, how many long to become the ultimate China Hand, the only outsider, the first and only laowai to crack China? But in the end, its an illusion.

We are Wanderers at the Ends of the Earth;

But to Meet Each Other Here,

Why Must We Have Met Before?

Bai Ju Yi: Pi Pa Xing

Tang Dynasty

AD 650905

For anyone whose mood is affected by the weather, Hong Kong in October is heaven. Theres a month of perfect blue skies with a bite in the air and a sharpness in the light that accentuates the dense green on the Peak against the brilliant blue of the harbour. So with my spirits buoyed up in the sunshine, I cut through the Botanical Gardens on my way towards Admiralty. A colleague in Shanghai had set up my meeting and I had no particular expectations. There was still plenty of time so I stopped to admire the orchids for a while.

I took the lifts to the eighteenth floor and waited. There was silence apart from the slightest breath of the air-conditioning. The deep red thick-pile carpet absorbed all traces of footsteps. Terracotta figurines stood in carefully backlit alcoves; there were lacquer vases with twigs of twisted hawthorn and one or two high-backed Chinese antique sandalwood chairs. The faintest scent of pollen drifted across from the huge white lilies in the tall glass vase on the table. And the silence. As I waited on the black leather couch, I couldnt help feeling that it was like so many other offices in these tall glass towers where nothing ever seemed to happen. Maybe I was about to meet another wealthy US business executive using the boom in Hong Kong as a cover for an early retirement away from the wife back home. Or maybe not. There was more style to this place than the average.

I was shown into an office behind a frosted glass wall. There were matching leather sofas, a full-length map of China on the wall and a spectacular view of the harbour. Behind the vast black polished desk there were shelves lined with tombstones, those little perspex blocks that investment bankers keep as trophies for their deals, with miniature copies of the public announcement of the latest buyout or merger inside. A framed copy of the front page of the New York Times hung on the wall. It reported comments about the Black Monday crash from prominent players on Wall Street. There were two photographs on the front page: one was of Rockefeller, the other was of Pat.

How ydoing?

An enormous figure strode into the room, squeezed my hand and gestured towards the low table near the windows. Tanned and relaxed, he looked like he was in his mid-forties. Difficult to tell: he was fit, I thought, that was for sure, powerfully built, a real bruiser in fact; the only clue to his age came from the slightest frost at the temples. After the small talk and the exchange of name cards, he leaned back in the chair, threw his arm over the back, and, with one foot on the edge of the glass coffee table, started out on his story.