|
Years
|
Stage Characteristics
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Government control level
|
Modern marketiztion level
|
Average GDP Growth
|
Consumer % in population
|
Business practice characteristics
|
IP protection level
|
|
1979 - 1985
|
Start Economic Reform from rural area. gave farmers responsibility for land. Farmers started to make money for themselves
|
85 %
|
10 %
|
9 %
|
0.1 %
|
Chinese in business barely knew market economics and capitalism. Low end commercial activities
|
Literally no IP knowledge or protection measure
|
|
1985 - 1995
|
Economy reform expanded to cities. Private businesses started to prosper, mostly focused on low end consumer goods, light industrial manufacturing. Social security reform started, property market started to open.
|
70 %
|
45 %
|
10 %
|
10 %
|
Market is characterised with tri-angle debt problem. Long receivable collection period and high bad debt write-off rate. Credibility of business was low.
|
Poor IP regulation. Pirate products of Western countries popularize with unmatched speed.
|
|
1995 - 2000
|
Further opening to International market, privatisation of heavy weight, unprofitable state owned companies speeds up
|
50 %
|
55 %
|
8 %
|
30 %
|
Market practice started to migrate toward conforming to Western business etiquettes. More commitment to quality and delivery. Credibility started to be paid attention to.
|
With the preparation of WTO entry, China government started to overhaul the IP legislation and tightening pirate practice penalties.
|
|
2000 -
|
Joining WTO in 2001 was the milestone of China’s economy development. The process of integrating into world economy speeds up, most of state-owned companies are being privatised, and went listing in Hong Kong and Nasdaq stock markets. The state-owned biggest banks’ bad debts are backed up by the government’s $45 billion cash injection in 2003.
|
17 % (this rate is decreasing fast)
|
70 %
|
9 %
|
50 %
|
Market is more mature in terms of business practice. Chinese companies realise the importance of quality and reliability in order to build long term relationship with their customers.
|
IP protection is strengthened with high speed to conform to WTO ruling. YAMAHA won a court case to get $ 110,000 compensation in 2002.
|
