China's Inconsistent Rules Will Continue To Complicate Ventures

ByJohn S. McClenahen Although the People's Republic is now a member of the World Trade Organization, manufacturing executives can't count on a "straight line to smooth operations in China," cautions Thomas J. Duesterberg, president of the Manufacturers Alliance/MAPI, an Arlington, Va.-based research group. A major reason: inconsistent rules about what companies can do and where they can do it. "Despite the best intentions of people in Beijing, there's a lot of authority that remains with regional and local officials," notes Duesterberg. "The old adage 'trust but verify' that [U.S. President Ronald] Reagan used to use with Russia certainly applies to China as well," he says. "Companies have to be wary and have to pay close attention to local circumstances -- and to local businessmen and local officials."