Quelch, who still serves as honorary chairman of an international advisory board at CEIBS, expects government “signals” to turn that around. “I think it's just a matter of lightening the regulatory touch. The signaling system in China is very well developed, in terms of the central government sending signals to the private sector,” he said.
China’s new security policies are “open-ended and therefore a significant source of uncertainty and concern” among multinational companies, following government raids on American companies conducting research and due diligence including Bain and Mintz. “It means that security management and legal counsel figure more prominently in the day-to-day lives of China-based CEOs of multinational companies.
Other Chinese companies “have played into the decoupling agenda by setting up their own manufacturing plants in Vietnam and other friendly countries,” he said. Similarly, Chinese businesses including EV maker NIO have made a big push to expand their investment and funding ties with the Middle East. “Chinese companies are diversifying their export markets and internationalizing their production,” Quelch noted.
“As a veteran marketer, I believe that any alternative has to be better, cheaper, or faster,” Quelch said. “While there may be government to government trades that are conducted in yuan for political purposes, the notion that the yuan is going to be a regular trading currency at the commercial level is a long way off.”