Chinese Culture And Value Culture

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INTRODUCTION Despite having extremely conservative foreign direct investment guidelines, the government of China has been successful in attracting foreign investment. Proper implementations of Human Resource policies for international strategic alliances have always remained as a real challenge in the country. In order to adjust in the Chinese market, international banks have customized their policies and lending criteria and the government has also restructured their banking policies and information technology services. Before setting up an international business, various factors should be considered like finding the perfect strategic fit which should also be in line with the Chinese culture and value culture. QUESTION 1: ANALYSIS OF…show more content…
There are also many fee based businesses of banks which have resulted in increasing the income of the banks. (Davila) There has been significant increase in the profitability of banks from 2004 to 2008, this was due to increase in net margins and decrease in non-performing loans. However, the growth is not very sustainable as every financial system is interconnected with the economic system. If the economy slows down then the banking industry will be hugely affected. Capitals of banks have fallen down and there is a forecast of average earnings of 14% per annum which is less than previous the levels. (Davila) As there was a global restructuring and reorientation in the banking industry, China made its own norms and banks had to comply with them. This is due to the hierarchy system which does not give banks a lot of independence to make decisions. Strategic partnerships were limited to 20% and foreign ownership to 25% leading to increased foreign investments especially for the SOCBs. The foreign investors were eager to spread their businesses in mainland China and were looking to tap into the growing credit card and asset management in China, however, the Chinese government imposed restrictions on their entry. (chaudhuri, 2009) The major change in the banking system came after the entry of China in WTO, and foreign participation was allowed to increase competitiveness for facing world economy. The Chinese management style and the culture based on
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