Australia’s resources houses have been urged to check how culture shapes China’s way of doing business in order to be more certain about attracting Sino project partners and to move clear from recent strained business relations between the two countries.
The trade guidance includes a caution that the biggest business risk facing emerging Australian explorers and miners looking for Chinese joint venture partners, is ‘not to do business’ with Sino entities simply because of perceived doubts and uncertainty about the fact China’s culture, history, political, regulatory and economic environments influence how they conduct their business affairs.
Issuing the guidance, Adelaide-based China-Australia business consultancy Kimberley Global, says the Sino commodities powerhouse remains Australia's largest trading partner, with both sides keen that there be no impediment to normal business relations.
Kimberley Global’s Dr Xian Tao says, “The domestic resources sector, particularly juniors, needs to take some heart from the fact both countries have gone to pains to stress the importance they see in the relationship not only on a bilateral basis, but for a strategic longer term.
“Ignorance, however, should not be used an excuse for failure to secure a Sino joint venture deal. There has been a litany of resources players which have failed to secure a Chinese partner due primarily to a clear lack of understanding of the country and culture into which they ventured.
“Some of these situations reached crisis level – a point damaging to mutual long-term business interests and strategies for both Australia and China.
“Chinese do conduct business in a different way but not at the expense of the desire for a mutually beneficial outcome - a factor that has been overlooked of late.
“From our experience, the key to understanding the Chinese business climate and to successfully negotiate and secure a Sino-backed joint venture, is to make a better effort to appreciate the history, culture, attitude and philosophy behind those ways of why and how Chinese businesspeople assess and then conclude a partnership deal.”
Dr Tao says Australian miners and explorers also need to appreciate that despite its 5000 years of history, China is in real terms, a developing and young country with a barely 60-year-old modern political, economic and legal system.
“The Chinese Government is helping drive continuous improvements and reforms in bilateral trade and significant changes are evident. This is creating opportunities, not barriers, to Australia’s resources participants and I can only encourage those within local exploration and mining ranks who hold possibly outdated views and attitudes towards China, to upgrade their awareness.”
She says modern Chinese business people are not dissimilar to their Australian equivalents and share the same family and professional values. “Any differences can be managed but require an open mind, good communication,  allowing sufficient time for each party to undertake their own due diligence and learning Chinese culture so that trust and closer working relationships result.”
She says joint venture partnerships are not a one way road and there remains an obligation on Chinese players in resources to reciprocate and learn to do business in Australia in an environment that better appreciates the Australian way of concluding transactions.

Resource Center Whitepapers, Videos, Case Studies

Conferences & Events

No events