Because of this weblog, our China lawyers get a reasonably steady circulate of China regulation questions from readers, often through emails but sometimes thru blog feedback or phone calls. If we were to conduct research on all of the questions we get requested and then comprehensively answer them, we might grow to be crushed. So what we typically do is provide a brief popular answer and, while it is simple to accomplish that, a link or to a blog publish that gives some extra steerage. We figure we might also put up some of these on here as properly on Fridays, like these days.
As everyday readers have probably discerned, this blog’s enthusiasm for China has waned (in conjunction with many of our customers). Not exceedingly, this has led to an onslaught of emails, a few exceptionally indignant, a few particularly complimentary, and a few merely asking us to explain our positions and the idea for the equal. The following e-mail, sent to me with the aid of an experienced China lawyer (and excellent pal), is consultant of many our China legal professionals were receiving:
What goes on with the blog in recent times? It appears you presently trust no one must be doing business with China. Is this authentic? Why could you assert this while so much of your very own law company’s enterprise relies upon China? Are you pushing for overseas organizations to decouple from China due to the fact you suspect this is pleasant for them for the US or your law firm?
My response becomes as follows:
I am actually now not of the view that no person ought to be doing business with China. That would be an absurd function. I truly assume that overseas groups need to have to as a minimum, don’t forget to have their products manufactured somewhere apart from China (for reasons of nice, fee, tariffs, etc.). They also must comprehend that doing enterprise in China continues to get greater pricey and more difficult. Perhaps they might be better off seeking to promote their wares or their services in Canada or Europe or Latin America or Africa in preference to China. You would be amazed how regularly we’ve conversations just like the underneath with clients:
Client: We have a brand new widget, and we are trying to have it made in China, and we want your assist with this, basically the same type of contracts and IP safety you gave us the ultimate time. [See Protecting Your Product From China: The 101 and note that the same sort of protections are generally required in every country]
Me: Aren’t those widgets being hit by using tariffs right now? And couldn’t you have those widgets made in Thailand or Vietnam for less? Have you looked into this?
Client: They are protected by using the tariffs, and we would love to be accomplished with China; however, I bet we don’t surely even know wherein to begin outside China.
Me: We will let you.
And then inside months, they’re having their widgets made in Thailand for 20% less than if in China, no longer counting that they may be tariff loose and no longer counting that few human beings don’t prefer to visit their factories in Thailand over their factories in China. So sure, we intend to get people to realize that they may not be required to do business with China. So sure, we suppose it is “fine for them” to take countries apart from China seriously.
As for our own regulation firm’s enterprise, we are pretty agnostic approximately this form of a factor in that we’ve got for years been diversifying past China, and we are nonetheless growing at warp velocity (we’ve doubled in length in just the last or so years, and we are bringing in a new global corporate attorney in May and we also are on the verge of hiring a brand new international trade legal professional and yet we still need greater so amazing attorneys so if you recognize of each person right for us, please let me understand). But normal corporations moving from China is certainly desirable for our law company. There are some distance greater law firms with sizable enjoy with China than law corporations with extensive enjoy with Thailand and Vietnam and Latin America, so I’m no longer extraordinarily concerned. Not best that, every customer circulate receives our new enterprise in the use of a to which they circulate.
But even though I have been concerned about the economic health of our law firm, there are two extra reasons why we aren’t going to stop seeking to get human beings to peer beyond China. One is that when we started this weblog, we vowed to always tell the fact as great, we may want to, knowing complete well that if our readers have been to doubt our veracity, they will flee us in droves. So to that quantity, we don’t have any choice. Equally essential even though is that regardless of how a lot we pressure the advantages of looking beyond China, we are simply one weblog, and it’s far simply now not probable that our posts will change sufficient minds to make a good deal of a dent in everybody’s commercial enterprise, even our very own. But sure, we think it first-rate for this weblog and our regulation firm to get businesses to keep in mind countries aside from China noticeably.
As for what’s nice for America, I cop to believing that overseas organizations going maximum other places is higher for the United States as nicely. I view US values and dreams as greater closely aligned to Canada, Mexico, Europe, Thailand, etc. Then to China, and I might individually like to see those places thrive. So I do revel in writing a publish like The China-US Trade War, and the Winner is….MEXICO, where I openly expressed my hope that more groups keep selecting Mexico over China: