China Traveller
November 2009
When I was still at university the buzz at the time was all focused on Samuel P. Huntington’s controversial book The Clash of Civilizations and the Remaking of World Order which created a bit of a stir as few could have anticipated the 911 attacks and the United State’s (supported by Britain) excessive response to not only invade Afghanistan but Saddam Hussein’s Iraq as well, creating the impression that the Christians were on a crusade against the Muslims again, with inevitable hatred generating consequences. Another emerging theory at the time, although less exciting, was that future conflicts would be caused by natural resources, and in particular, water shortages resulting in bad science fiction type movie ‘water wars’.
Little did we know as students at the time that in the not so distant future we would personally witness the emergence of a combination of cut throat competition for natural resources and growing nationalist assertiveness with the potential to result in open conflict. Diminishing natural resources around the globe coupled with the economic skyrocketing of the world’s most populous nations (China and India) with an insatiable appetite for the finite supply of resources has already resulted in levels of economic warfare. Renewable resources are the talk of the day but with Eastern and Western nations alike staking their claim in South America and Africa’s resource reserves they are clearly doing more than hedging their bets. The battle lines for other resources have also been drawn including access to finance and a return to human trading, the poaching of the best and the brightest minds to supplement aging societies. Competition for limited resources of all types has dramatically increased over the past two decades creating the perception of a ‘winner takes all’ eventual outcome. Is your country brand perceived to be a winner?
Countries today face far stiffer competition when it comes to economic activities such as trade, investment, tourism and recruitment. But although they remain strictly economic prerogatives they are nevertheless unduly influenced by politics, by the nation’s people, a reality that is only expected to strengthen with increased nationalism triggered in turn by the cycle of increased economic competition. Political leaders, and even business leaders to a large degree, seldom take purely economic fundamentals into consideration, we are after all social orientated humans and not efficiency optimizing robots, and as such country branding, the perception of one’s sovereign state, has never been more crucial for survival or success.
The recent emergence of sovereign wealth funds (SWF’s) is evidence of the escalation of economic warfare between sovereign nations. While SWF’s are state-owned investment funds normally established by governments with budgetary surpluses, and composed of financial assets with the objective of maximizing long-term return, they have raised national security concerns. Some fear that SWF’s can be utilized to secure strategically important industries for political rather than financial gain resulting in legislation in some countries already requiring prior government approval for significant foreign acquisitions in strategically important companies.
Despite China’s progress in the overall rankings of the recently released Country Brand Index, it is clear that the country brand of China is not a particularly trusted one. This has serious implications for its outward economic objectives as seen when the US previously blocked China’s CNOOC from acquiring Unocal. China’s SWF, China Investment Corporation (CIC) has allocated approximately US$66 billion of its total US$200 billion fund for foreign acquisitions while it’s China – Africa Development Fund, with a gradual budget of US$5 billion, will focus mainly on Africa’s natural resources. The non-adherence to local regulations resulting in dangerous and improper working conditions have already resulted in numerous outbreaks of protest by African workers at Chinese managed operations in Africa. It is thus entirely possible for an African government, or its workers, to resist or outright reject Chinese business initiatives based on protest reports emanating from a perception of irregular economic management. Sticking to this example, China would be well advised to clear the ground for their Africa investments through proactive public relations that target the people, as lucrative government to government relations only account for one aspect, governments do after all, change. The same is valid for China’s image in other regions. This is not to say that Africa would necessarily welcome other ‘Africa resources rush’ countries such as America, Britain, France, India and Russia with open arms. Often to the contrary, the West’s historical role in the colonization of Africa and suspicion of renewed paternalist attitudes disguised as human rights has encouraged many an African government to welcome China’s ‘no strings attached’ trade and development.
It has been claimed from different sources that if the entire world’s population consumed as much as America citizens we would require anything from three to four and a half world’s of resources. The per capita GDP rise in previously underdeveloped regions such as South America, Africa and Asia has resulted in an accompanying rise in consumption that environmentalists believe to be unsustainable. Until the world’s leaders and people come to their senses the ability to secure these dwindling resources, facilitated by increased globalisation, will largely depend on the country’s ability to project the perception of being a trusted, valued, even privileged partner.
Russia is a textbook example of a brand basket case country that is in dire need of a branding make-over. From its ill considered KGB era speeches that fail to frighten its intended audience, to the corporate raiding in the TNK-BP affair and neo-Nazi attacks on Africans and Asians coupled with police harassment/corruption targeting tourists in Moscow, the country has little going for its brand. And what a pity considering its inability to retain the excellent individuals it produces who excel on the international stage in a country of such vast and untapped nature that could, with a little effort, become one of the world’s top tourist destinations. But while Russia is struggling to survive the global sigh of relief to see George W. Bush vacate the White House accompanied by Obama’s welcomed election to the position of President and, more importantly, Commander-in-Chief, saw the United States successfully claim the first position in 2009’s Country Brand Index, up from 3rd place in 2008. As the world’s largest economy with a history of enshrined property protection, few would doubt America’s trade and investment structure, but it will take more confidence building measures to convince potential travelers that they are welcome in the US again after the multitudes of horror stories emanating from their short sighted airport customs & immigration officials conducting security theatre.
Holistic country branding for developing countries will be especially vital to their success as sovereign states as, unlike their brand strong counterparts in North America and Western Europe, who on closer/personal inspection might turn out to be disappointingly inefficient, narrow minded and downright boring, they continue to suffer from negative perceptions and stereotypes as old as the hills. Not every country can excel at every possible economic activity and the onus lies on (especially developing countries) government’s to identify their true niche economic areas of expertise and convey those messages in a sophisticated and sustainable manner to the outside world. The 2009 Country Brand Index has highlighted the yearning for authentic tourist destinations amongst potential travelers as a future trend so countries without competitive modern industries but who are nevertheless endowed with natural beauty and an authentic culture should be at the forefront of branding their tourist offerings.
Country branding sub-categories such as trade & investment, tourism and recruitment cannot act in isolation any longer however and must be stringed together under an umbrella country branding strategy. No matter how sensational a beach might appear, or no matter how enticing a business deal might seem, individuals are not going to be triggered into action if they perceive a country to be inhumane, dishonest, dangerous or any one of numerous negative attributes. Many years later the jury is still out on Samuel P. Huntington’s ‘Clash of Civilizations‘ theory, but the verdict is in on countries that are persistently perceived in a light inferior to the reality, their country brand custodians should take note.
