Saturday, December 18, 2010

Shanghai Expo: forging or merely viewing the future?

Shanghai Expo -- the 2010 World's Fair in Shanghai -- was amazing, and amazingly successful as well. Now that the site has been closed, I'll post this column that I originally wrote in May and which ran in China Entrepreneur magazine:

The gala opening of the Shanghai Expo has focused the world’s attention on this vibrant city that is forging the future -- or so we are told. Let no one doubt Shanghai’s vibrancy!! As a native New Yorker, I can truthfully say that Shanghai is the most interesting city that I have ever lived in, and that’s a huge admission for someone born and raised in “the big Apple.” Yet, why wouldn’t a city of 20 million be “vibrant”? Isn’t that an attribute of size? Rio de Janeiro, Mexico City, Bombay, they can also be described as “vibrant.” What is more telling is the attribution that one commonly sees ascribed to Shanghai as a city “forging the future.” You never hear anyone speak of Rio, Bombay or Mexico City as forging the future, unless it is in a dark science fiction novel with a future gone bad. Yet, Shanghai always has this sense of future promise about it; and this is as it should be for an Expo host, as the future has always been a key characteristic of every great World’s Fair, or Exposition, stretching back as far as London’s 1851 “Crystal Palace” Great Exhibition of the Works of Industry of All Nations; and certainly this was true of Chicago in both 1893 and 1933; probably St. Louis in 1904; certainly Paris in 1925; and New York in 1939 and 1964. In fact, visitors to the 1939 Worlds’ Fair in New York were given buttons which exclaimed “I have seen the Future.” The question that I have, however, is should such buttons be also given out at the Shanghai expo, and, if so, just how is Shanghai actually going about “forging the future”?

If we look at New York city in the mid-twentieth century, at the time of both of its World Fairs, it was a city of immense possibilities. Not only was the world’s economy centered in its banks, but the emerging electronic entertainment media (radio & television), and advertising industries, that would change everyone’s lives, were housed there as well. In addition, the United Nations was about to settle there as its home, and the local jazz scene was actively spreading its message and influencing the music of the world. People from everywhere were drawn to New York by its magnetism, creating a polyglot street culture that would add color on top of a foundation of earlier successive waves of immigrants, creating a true “world city.” Is it not surprising that so much of America’s creative power in the second-half of the twentieth century would be New York inspired? In fact, one could argue that the 1939 buttons were correct: come to New York and you will see the future!

What about Shanghai? Will we be able to say the same thing fifty years from now about the Shanghai expo? About seeing the future? While I have no doubt at all that Shanghai is China’s “style-setter,” I remain perplexed about the absence of big Shanghai brands in the industries that will shape our future. Baidu, Haier, Huawei, Lenovo, ZTE, even Geely …… These are the brands that are shaping China’s future, and bringing China to the greater world market, yet none of these are Shanghai brands. If we look at the Financial Times’ Global Top 100 brands [April 28, 2010], while there are seven Chinese brands, none are from Shanghai. In fact, if we review CLSA Asia-Pacific Markets’ new “China’s top 20 most valuable brands” [September 2009], we find that the Bank of Communications [#6] is Shanghai’s sole listing -- hardly an electrifying futuristic brand! So, where are the Shanghai brands? As China speeds forward into the global marketplace, Shanghai brands are not even in the race. Instead, it is places like Qingdao, Beijing, Shenzhen, and Shunde, that are producing the standard-bearers for China’s global commercial aspirations. How can that be? How can the nation’s most dynamic city not be at the forefront of China’s branding revolution? What sort of future is Shanghai forging?

Or, take competitiveness: in 2009, the Boston Consulting Group identified 100 “new global challengers,” from the emerging economies of the world that “... either have attained global leadership positions or have demonstrated credible ambitions and abilities to achieve sizable global footprints.” Of these 100 new global challengers, 36 are Chinese; yet, only 4-5 actually come from Shanghai; all of whom are in important, but decidedly old-economy industries [BaoSteel, China Shipping, COSCO, SAIC, and perhaps China Communications Construction]. Is this the future that Shanghai is forging? In fact, BaoSteel and SAIC are the only two Shanghai companies, out of 24 Chinese companies, on the Fortune 500.

This year, BYD Auto became the first Chinese company to make the “top 10” of Business Week’s “Top [50] Innovators,” yet it is from Shenzhen. None of the other Chinese listers [Haier, Lenovo or China Mobile] are from Shanghai either. In April of this year, MIT’s Technology Review launched its first listing of the “50 Most Innovative Companies in the World”. While it included such stalwarts as Apple, IBM, GE, Intel,, and DuPont; it also included Wuxi’s Suntech; but no Shanghai representative.

So, while my love for Shanghai remains undimmed by this reflection, I am troubled by the near-absence of Shanghai companies on any list that would reflect an active role in forging the future. I will visit the Shanghai Expo this year, just as I visited the 1964 New York World’s Fair, and I will look for signs of how Shanghai is forging the future. My hope is that what I will find there is an active authorship of what is to come, rather than a voyeur’s view of what others might be doing. And, while I have no doubt that the Shanghainese are building a “world city,” the mechanism by which this will play its role in creating a future for us all remains a mystery to me.

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