via: black china hand
Accordingly, if we can get funds from a foreign bank we can then present this to a Chinese bank as a guarantee. This makes it much easier for a Chinese bank to lend money because they can see that an American, Japanese or European bank is lending and so they feel more at ease. Naturally, then we have to first make use of other people’s money to get more money.
this is exactly what a friend of mine experienced over the past several months. large organizational investors don't have the time to do the due diligence for small projects and small investors only trust people they know or otherwise are corrupt. but there is another "system" that works independently from the state-owned one ...
an investor in China must cultivate, cultivate, cultivate connections because in China connections are the only way to go and quite literally the grease that oils the wheel. Without connections, investing —or doing anything— in China is doomed to fail. Having a large connection net is essential because you never know who will be able to help you. China is a very community oriented society and so there is no problem in using others to get what you want.
the "guan-xi" issue is very tricky to handle, even for a chinese. what people to know and what relationship to invest in are always big questions for businessmen here. the most hard part of the issue is, sometimes you need to invest for years before your "guan-xi" offers a hand to you.
but if you invest in government ventures or partner up with a government department you will succeed. You see, there is no way that the government will allow its own project to fail...they will do all that is necessary to ensure its success.
it depends.perhaps this guy made investment in rural china, where the governments could use all kinds of resources to ensure the success of investment.