Business pioneer
UK executive has helped build bridges since 1970s
In 1954, during the Cold War, a group of 48 British businessmen took seven days to travel to Hong Kong amid efforts by the United States to stop people from visiting China. The team then took another four days to get to Beijing, with the help of an emissary of premier Zhou Enlai.
Their historic trade mission, which helped deliver items ranging from grain and copper to machinery and medicines, established one of the first modern-day trade links with the outside world after the founding of the People’s Republic of China in 1949.
The 48 men were the precursor of a business association, the 48 Group Club, led by Jack Perry, the late founder of the pioneering London Export Corp. The trip became known as the “Icebreaking Mission”, and the club members called themselves “icebreakers”.
Perry’s son, Stephen, has since taken over the reins as chairman of the company and the club. With today’s booming Sino-British business landscape, the club plays a central role in bridging relations between China and the United Kingdom.
Stephen Perry, who traveled to China with his father in 1972, has since become a regular visitor to the country’s flagship Canton Fair in Guangzhou, capital of Guangdong province. This has enabled him to see up close the dramatic changes that have taken place in China, especially since 1978, when the reform and opening-up policy began to transform the nation from a planned to a market economy and unleashed its entrepreneurial spirit.
Recalling his experiences of traveling to China in the ’70s, Perry said his impression was colored by memories of massive poverty and the hard life of rural residents. Yet despite the financial difficulties, he saw that the Chinese people were already thinking about the future.
They were “spending a lot of time talking, philosophically, on what was the right way to go”, he recalled. “I was very impressed.”
Then, in 1978, he witnessed a massive transformation. “The first changes were the decentralization of China’s agricultural sector, the breaking up of the commune, which gave people more freedom. Universities reopened, schools became important, and people started to debate issues.”
China’s reform focused on a shift from the previously State-dominated economy to encouraging private sector participation. Price controls and protectionist policies were removed or reduced, and as a consequence the private sector grew remarkably. The sector now contributes more than 60 percent of China’s GDP growth and provides more than 80 percent of jobs.
Over the past 40 years, the country’s GDP has grown at an average of about 9.5 percent a year.
Opening-up also brought regulatory changes that allowed foreign investment, and with that Chinese companies were encouraged to trade and invest abroad.
“There is still a long way to go but, my goodness, no country has advanced with that speed and with that dynamism,” Perry said.
For him, China’s economic transformation is not just about the numbers. Visiting the Canton Fair over the years, he has noticed a massive change in the foreign trader’s experience.
Held since 1957, the annual event is China’s oldest and largest trade fair. During the ’60s and ’70s, when China was relatively closed off from the rest of the world, the fair was the country’s window to foreign trade.
Since 1978, as the nation has opened up, the fair has flourished. This year, it has 60,475 booths across 118.5 hectares. To put the numbers into perspective, that’s equivalent to the size of about 70 Walmart Supercenters.
More than 150,000 types of products are represented at the fair, including consumer goods, textiles, decorations, medicines, electronics and machinery.
Perry said today’s scale would have been unimaginable back in the ’70s, when the fair was dominated by a handful of State-owned trading corporations that had a limited range of items to sell and buy. For him and the other foreign traders, participating was also a physically exhausting process.
“I would start working at 6 am in Guangzhou, replying to our colleagues in London. Then we would have breakfast and get the first bus to the Canton Fair, which opened at 9:30 am,” Perry said, adding that he would sometimes have to race across the halls of the Canton Fair in jogging shoes.
The fair opened with music and the cutting of the ribbon. By noon, Perry would have gathered orders from Chinese customers, ready to communicate back to London. The hard work was justified by abundant orders, and London Export Corp took a 2 percent commission on every deal.
In those days, Perry said, he and his colleagues in China would get only four or five hours of sleep a night. And the hot and humid summer months were especially memorable. “We were exhausted. There was no air conditioning, and there were a lot of mosquitoes.”
Such conditions are perhaps unimaginable to the foreign traders who visit the Canton Fair today. They can access air-conditioned rooms and luxury facilities at the large Shangri-La Hotel next to the exhibition center.
Traders no longer need to race across the exhibition halls in jogging shoes, either, as digital communication has played a big part in making the trading process more efficient.
Challenging transformation
Yet allowing greater foreign access to China’s market has not been a one-sided success story for Perry. Transparency and the free flow of information in China’s bilateral trade relations with the world saw London Export Corp’s role as a go-between dwindle, and in the ’90s the company had to fundamentally shift its business model from that of a trader to a deal adviser.
The transformation was not without its challenges.
“We found our own way, but it was painful,” Perry said with a hint of sadness. “We didn’t get enough briefing. I had hoped the Chinese foreign trade people would’ve taken more responsibility (to brief us). We had given all our lives to foreign trade.”
London Export Corp eventually became a business and cultural exchange enabler. In 1978, Perry brought English soccer club West Bromwich Albion to Beijing to take on the “China XI”, making them the first English team to play in the People’s Republic of China.
In 2001, Perry also helped bring musicals by Andrew Lloyd Webber to China. Jesus Christ
Superstar was performed in Beijing in 2001, while Cats and Phantom of the Opera have also toured the country.
If Perry felt lonely on his early trading trips to China, that feeling is now gone. Many younger British businessmen and women aspire to follow in his footsteps by trading with China, and he enjoys sharing his personal experiences and tips, as well as his memories of the early days.
“If I went out to a dinner party as a young man and people asked what I did, I’d say ‘I do business with China’, and they would change the subject and talk about something else,” he said. “But now, when I say I do business with China, they say ‘There are several things I want to talk to you about’.”
Meanwhile, China’s trading links with the world have accelerated. If export growth in the ’80s and ’90s made China the world’s factory, the situation changed in 2001 when China joined the World Trade Organization. Since then, the country has placed increasing emphasis on the quality rather than volume of its exports.
This year, Shanghai will host the inaugural China International Import Expo, symbolizing the nation’s transition to a consumption-driven growth model. China is expected to import more than $10 trillion in goods and services over the next five years.
But the incredible story of China’s trade growth is not just about bilateral trade flows. More importantly, the country is spearheading a grand vision of connectivity between Asia and Europe through the Belt and Road Initiative.
From 2014 until last year, the trade volume between China and countries involved in the initiative exceeded $4 trillion, and total investment exceeded $60 billion. Seventy-five economic and trade cooperation zones have been set up, creating more than 200,000 jobs for local people.
Perry said China’s path of building a modern knowledge economy and further integration with the global market will be the natural next steps for the country’s reform and opening-up process.
“Through the BRI, China will further be a part of the world, although it will not dominate the world, and I believe that’s what Chinese leaders believe in,” he said.