By Charmaine N Clarke
On August 28, CEIBS alumnus and President of Cathay Capital Private Equity Cai Mingpo announced that his company will donate €500,000 to establish the Cathay Global PE Research Fund at CEIBS. It was the latest in a series of initiatives, over the years, that have underscored CEIBS’ importance in Sino-European ties. By promoting the study of global private equity investment, along with the innovations taking place, the fund will have far reaching implications. It will also complement Cathay Capital’s Sino French Innovation Fund, a new cross-border investment vehicle dedicated to venture capital financing for innovative start-ups. Focused on activities in France, China and the United States, the innovation fund will invest up to €25 million in about 18 Internet related projects.
Cai’s company is just one of the many CEIBS alumni ventures that have invested billions of euro and created thousands of jobs in Europe since the school’s launch in 1994. “Though CEIBS is still a young business school, the impact that our alumni have had, and continue to have, on the vital Sino-European relationship is impressive,” says CEIBS Chinese President Professor Li Mingjun. “Their accomplishments reassure us that we are making a difference.” Of the almost 200 CEIBS alumni working in Europe, about 88% are at management level while the rest – like Cai – are running their own businesses. Meanwhile, there are more than 100 European alumni working in China. Some of them stayed after studies funded by scholarships such as those provided under the EU-China BMT Project.
Working in collaboration with three other academic partners – European Foundation for Management Development (EFMD), Frankfurt School of Finance and Management (FS), and IESE School of Business – CEIBS won the bid for the €10.1 million BMT Project in 2007. “In 1984, when CEIBS’ predecessor CEMI was set up to provide much needed management education in China, the EU provided scholarships for many of the students in its all-Chinese class,” says CEIBS European President Professor Pedro Nueno. “The BMT project was a natural progression in the Sino-European relationship.”
The BMT’s goal: to provide the educational base needed to support business in facilitating China’s social and economic reform, a move that would ultimately create lasting relationships between the Chinese and European economies and benefit both sides. It is, after all, in the interest of both parties to see the other do well. According to EU data, EU-China bilateral trade in goods reached €467.5 billion in 2014, up from €428.1 billion in 2013. EU imports from China were worth €302.5 billion, while EU exports to China reached €165 billion. The EU is China’s biggest trading partner, accounting for 14% of China’s external trade. Meanwhile China is the EU’s second biggest trading partner, after the US.
It is no surprise, then, that both sides have regular discussions aimed at strengthening their relationship. In fact, there are more than 60 high level and senior level dialogues, working groups and steering committees that focus on issues such as foreign policy, security and defence, cyber, high tech, innovation, and people-to-people exchanges. The latter is also a component of the EU-China 2020 Agenda for Cooperation which lays out the framework for relations between both sides over the next five years. It covers everything from cultural to educational initiatives and CEIBS has done its fair share in advancing this agenda. The school’s EU Days have served up everything from thought-provoking lectures to wine tastings. Meanwhile, the BMT Project provided more than 100 exchange scholarships for MBA students across Europe and China between 2008 and 2012. It also made it possible for another 60+ students from China’s inner regions to enrol in the CEIBS MBA, and provided modern business management training to more than 400 mid-level professionals from the Western, Central and North-Eastern regions of China.
In addition to scholarships for participants from both sides, plus developing and providing business management training in China, other aspects of the BMT included strengthening academic and corporate interactions as well as boosting the EU’s visibility in China. This included everything from research by CEIBS faculty to forums hosted on its campuses (see “Boosting EU Visibility in China”).
“Over the years, there have been many other tangible expressions of the strong ties between China and the EU and the role that CEIBS has played in strengthening those bonds. CEIBS faculty, for example, have played a significant role in creating and disseminating knowledge on Sino-European issues,” says CEIBS Vice President and Dean Professor Ding Yuan. Under the four-year-long BMT Project alone, more than 16 research papers were written by faculty who also supervised more than 60 EU-China related research papers by students. Over the years, CEIBS faculty have also been frequently quoted in the media on European and/or China-EU issues. As a result, they have helped shape public debate on topics ranging from doing business in China to stagflation in Europe (see section called “In the Media”). At the same time, CEIBS has also been a meeting place and platform for leading global executives – many of them from Europe and China – who, as part of the school’s International Advisory Board (IAB) meet annually to advise school leaders on strategic issues. IAB meetings are invariably shaped by global economic affairs and these gatherings provide an opportunity for some of the world’s best business minds to frankly share their views.
Only 21 years old, CEIBS has become synonymous with the EU-China relationship. A stop at its campuses in China’s economic and political capitals – Shanghai and Beijing – is often on the agenda of visiting European officials. A look back at the school’s history also shows numerous visits by high-ranking Chinese government officials (see related story “Remember When…”). CEIBS’ value is obviously not lost on those who recognise the importance of the Sino-European relationship. During his term as European Commission President, Manuel Barosso described CEIBS as “a very successful symbol of cooperation between the EU and China”. In 2008, speaking at the EU-China Business Summit, then Chinese Premier Wen Jiabao ended his speech by saying, “China will continue to cooperate with the European Union in the areas of education and science. Our previous agreements have led to obvious, positive results. The China Europe International Business School is an example of this. CEIBS has become an incubator for excellent business leaders.”
The CEIBS community knows a lot is expected of it.
“The challenge now is for CEIBS to build on the solid foundation it has laid over the last 21 years in order to remain relevant in shaping the next 40 decades of EU-China ties. It is a challenge that the entire CEIBS community eagerly accepts,” says CEIBS Vice President & Co-Dean Professor Zhang Weijiong.
Cai Mingpo (EMBA 2004, CEO 2009)
President of Cathay Capital Private Equity
The China-EU relationship has never been more promising and full of opportunities. Despite the lower GDP growth environment, the China development story is still in its early years and promising. The slowdown of GDP growth is a sign of maturity: you have to slow down before taking a major turn. A weaker quantitative growth can be a stronger qualitative one if it is more harmonious, more respectful of the environment and less dependent on low cost exports.
China is coming out of its “factory of the world” model to become a full market offering much more than low production costs. It is already a major hub for many European companies but the potential is still considerable, especially in areas such as consumer goods, services, healthcare, clean tech, etc.
The rise of Chinese consumers also creates a favourable ecosystem for innovation with the emergence of new uses and needs through the mobile internet revolution. Innovation has a huge impact on economies and business models, and our vision at Cathay is that companies need to connect to the key networks in Europe, Asia and the United States in order to accelerate their international growth. With our focus on innovation, we are pleased to collaborate with CEIBS on projects such as the recently-launched Cathay Global PE Research Fund as the school continues to provide management education to business executives such as myself and the next generation of business leaders who will help shape the China-EU relationship.
Zhu Hai (EMBA 2001)
President of Schneider Electric China and Schneider Electric Global Executive Vice President
The time I spent studying at CEIBS is particularly memorable. I treasured the atmosphere there, which was an integration of East and Western cultures. It was at the school that I learned that frankness and innovation were important aspects of the European approach. I also deepened my understanding of Chinese culture, especially its characteristic depth and tolerance. My career was greatly enhanced by the lessons taught through a combination of East and Western elements, which gave me an international perspective and the sophistication to lead an enterprise.
My company Schneider Electric is a European enterprise which originated in France and has been rooted in China for almost 30 years. It is one of the foreign companies with the greatest achievements in localising for the Chinese market, and is a paradigm of the blend between Chinese and European corporate cultures.
From my personal experience, and the success of Schneider Electric, I can tell there’s marvellous synergy between Chinese and European cultures. Once the two cultures are combined, immense power can be unleashed.
After two thousand years, the exchanges between China and Europe have grown stronger, tens of times more than that in ancient times. We are fully convinced that the exchanges between China and Europe would give birth to even more splendour in the years ahead.
I am honoured to celebrate the 40th Anniversary of China-Europe ties together with my alma mater, and witness a brand new milestone of this miracle.
Guillaume de Colonges (GCPT14)
CEO, Carrefour, Turkey
Like all relationships that span four decades, the one between the EU and China has seen good times and there have been shared values, accompanied by difficult times and severe differences. Reflecting on the last 4 decades brings us to think about what the future holds for this union.
The economic ties between China and Europe will only get stronger, whether in terms of Chinese-made products coming to Europe, or European luxury goods purchased by Chinese consumers. However, while there was plenty of room for expansion over the last few decades, today’s difficult economic situation has brought us closer to a zero-sum game. The single biggest challenge for this partnership, going forward, is trust and credibility on both sides. Europeans need to see China as a partner and a potential engine for economic growth in the coming years. At the same time, the Chinese need to enhance their institutional credibility, assuring Europe (and the world) that all companies will be treated equally in China, there will be no discrimination against foreign players and that China will not engage in short-term economic policies.
Forty years is a short time in international diplomacy and both sides are still in the phase of building trust. If this is done within the next 5-10 years, we will be looking at a period of mutual growth and prosperity for both sides. There is a lot that can done by CEIBS and its alumni, in the years ahead, to foster the EU China relationship: academic exchange and the sharing of knowledge, the strengthening of networks between business executives on both sides, and providing a platform for continued dialogue and debate. These will all help to build mutual understanding and trust. I am eager to see what comes next.
Luo Fei (EMBA 2006)
Chairman and CEO of BIOSTIME International Holdings Co Ltd
As a CEIBS alumnus, I am honoured to have studied at a business school established with investments from China and the EU. We’re also honoured that BIOSTIME is now a corporate partner for CEIBS Centre for Globalisation of Chinese Companies. We provide a vivid case of China-French acquisition for the research centre, and we receive advice and support from the centre’s faculty. In the future we will deepen our collaboration with the research centre, and continue to explore the “going global” strategies for Chinese companies through our initiatives. We hope to be able to help more of “China’s capital” and “Europe’s resource” successfully combine and profit.
Since its inception in 2000, BIOSTIME has collaborated with French companies. It’s one of our visions to bring premium French baby milk powder to the Chinese people. In 2013, BIOSTIME invested in the French milk company ISM. We did this because we value the prime local resource, Normandy AOP milk source, and because of the advanced milk processing techniques of the French company. In the future we’d like to look further into the development potential of the investment model of “resource + technology”, in order to inspire more Chinese companies that wish to go into Europe.
Oliver Bruns (MBA 2006)
Coveris Flexibles Deutschland GMBH
When I look at the next decades of the China-EU relationship, I would expect a significant increase in knowledge transfer from China towards the EU. Over the years, a lot of the discussion has been around bringing knowledge from the EU to China. I’m truly convinced, though, that the EU can benefit from a lot more than just economic ties and that we will see a lot more knowledge from China coming into the EU.
Business, as well as general cross-cultural cooperation, starts with establishing a common understanding for each other. Connecting people, establishing relationships based on mutual trust is key to further strengthening the relationship between China and the EU. Institutions such as CEIBS are and will continue to be of increasing importance in establishing strong connections.
However, maintaining cooperation is, like any relationship, hard work. Both sides have to demonstrate that they want it. And obviously, any good relationship needs to have a strong base of mutual values. The challenge will be to keep on working on the China-EU relationship when times are difficult. Especially tough times will show if the China-EU relationship is strong enough to be more than just economic ties. I truly hope it is.
Konstantinos Derdemezis (GCPT15)
South East Europe Executive Regional Director
Titan Cement Company SA
In an increasingly interconnected international landscape faced with a series of acute and impactful global challenges, it is of extreme importance that two of the main global actors, the EU and China, further deepen their relationship and strengthen cooperation on multiple fronts with the aim to promote peace, prosperity and balanced growth. In spite of the progress made over the last 40 years, grave multi-faceted risks such as climate change, terrorism, changing demographics, proliferation of nuclear and chemical weapons, obstacles to trade and elusive sustainable development need to be further addressed in pursuit of common development of China, the EU and the rest of the world.
With trade remaining the primary driver of China-EU relations, stronger emphasis could be placed on facilitating maximum access to each other’s markets and lifting existing barriers which hinder movement of goods, capital and services. Apart from the obvious mutual economic benefits, the EU will be able to additionally tap into the potential of China’s growing middle class while at the same time human capital from China may play a decisive role in mitigating the phenomenon of Europe’s aging population. Leveraging on its learning curve, accumulated experiences and already applied practices, the EU could transfer know-how and support in helping China deal with the intensifying need for introducing all-inclusive social systems (e.g. social insurance, healthcare, etc.) as well as with the Asian country’s increasing urbanisation and the range of associated challenges.
To complement these initiatives, both sides will need business leaders who recognise the significance of EU-China ties as well as the potential opportunities and synergies that are ahead. For more than two decades, CEIBS has played an important role in that regard. It will be a role that is increasingly important in the decades to come.
Simon Lichtenberg (SEPC)
CEO Trayton Group/Simon Li Furniture
Today’s Europe is challenged by an influx of refugees and economic volatility. China is challenged by a slowdown in growth and adjustment of the RMB, and its roller coaster stock market.
Meanwhile the entire world has a huge challenge over the coming decades to stop global warming – and hopefully work together across continents, nations and people.
While the European Union is not united in all political issues, along the broad lines Europe can work in a concerted way, together with China. They have done so in the past. Together they can lead the world into a better environment, one with more responsible business, and where new productive ways of cross continent collaboration among states will be invented between China and Europe. We all live in the same world – we are in the same boat – and the Chinese and European governments understand that only together can we change the world. It is the EU and China’s responsibility to act; it is also up to us, as individuas, to take an active part in delivering practical solutions. CEIBS, a common bridge between both sides, will be relied on to play its role as well: providing China-specific knowledge and training business executives who can help both China and the EU make the changes needed that will impact all our lives.
Thorsten Seeger (MBA 2005)
Head of SME - Financial Markets
Lloyds Banking Group
We have come a long way; the relationship between China and Europe has become stronger over the past 40 years.
I anticipate that in the next four decades it will be even stronger. The EU is already China’s biggest trading partner and the amount of direct investment and tourism is ever increasing. At the same time, there is still a lot we can learn from each other and we should use this anniversary as an opportunity to have deeper – and also more challenging – conversations with each other.
Personally I am excited about the opportunity that China will present to the EU, and I am looking forward to many happy interactions with friends and potential business partners in China over the next 40 years. I am also looking forward to seeing how CEIBS will build on the tremendous role it has already played in supporting the EU-China relationship.