Globalizing Chinese Business Firms: Where are They Coming From, Where are They Heading?

Abstract

In a widely-read Harvard Business Review article, John Kao (1993) concluded that Chinese business and its ‘worldwide web’ will become a major force in the global economy in the next millennium. Similarly, Joel Kotkin argued in Tribes: How Race, Religion and Identity Determine Success in the New Global Economy that by the early twenty-first century, ‘the Chinese global tribe likely will rank with the British-Americans and the Japanese as a driving force in transnational commerce’ (Kotkin, 1992, p. 9). Despite the 1997/8 Asian economic crisis, it appears that current thinking in global business reveals a serious reappraisal of the economic potential of Chinese business and its associated organizations and institutions. The Weberian thesis on the inherent limits to the growth of Chinese business and societies has been subject to fundamental challenges by recent studies (for example, Hamilton, 1996a; Whyte, 1996; Olds and Yeung, 1999). Scholars of contemporary Chinese business affairs have been forced to recognize the economic success of the ‘overseas Chinese’¹ and their business firms in the host countries throughout East and Southeast Asia. Once established in host countries, Chinese business firms have extended their business operations and ‘bamboo networks’ across national boundaries, forming an increasingly global web of economic relations. These developments underscore the significance of a recent phenomenon in Chinese business — the globalization of Chinese business firms.

Chinese-owned businesses in East Asia, the United States, Canada, and even farther afield are increasingly becoming part of what I call the Chinese commonwealth. (Kao, 1993, p. 24; original italics)