Two sessions; Three Opportunities – the key takeaways from China’s Communist Party meetings

Racepoint Global

Written by: Toby Yu – Account Director, Racepoint Global Shanghai

Much of the discussion around the 13th National People’s Congress (NPC) and the 13th National Committee of the Chinese People’s Political Consultative Conference (CPPCC) (often referred to as the ‘Two Sessions’) centered around the landmark change in the Chinese constitution that will allow President Xi Jinping to stay in office for a third term and perhaps longer.

The two sessions on the 3rd and 5th of March covered significantly more than this relatively minor change, since they are the first party meetings to bring President Xi’s vision for China to life, which he had delivered at last year’s five-yearly National Party Congress: “Thought on Socialism with Chinese Characteristics for a New Era.”

The reforms are wide-ranging and touch on almost all aspects of life in China. Businesses trading in China need to understand the new zeitgeist so they can capitalize on the opportunities they present. Below are three of the most significant changes foreign businesses need to understand.

Stricter Censorship and Surveillance

The change in China’s constitution to allow President Xi to stand for a third term and possibly longer ignited discussion on Chinese social media and drove government censors into overdrive.

Several key terms were suddenly subjected to heavy censorship on Sina Weibo, China’s Twitter-like microblogging platform. Phrases such as “I don’t agree,” “migration,” & “emigration” were all banned to minimize conversation around the constitutional change. But other words and phrases have also been censored – the use of “boss” in describing state-owned enterprises; “China and Hong Kong/Macau” (should be mainland China and Hong Kong/Macau); and even the much heralded “One Belt One Road Strategy” has morphed into “Belt and Road Initiative”.

As brands such as Marriott and Mercedes-Benz found recently, China has become much more aggressive in its censorship of online content even outside its borders. These misdemeanors are tracked by the government and foreign companies are subject to fines, or worse.

Our teams in China are highly knowledgeable about the changing nature of the communications landscape and can help international brands prepare for the unique challenges. We’re well used to adapting global messaging to suit local needs, as well as monitoring all channels to ensure we stay ahead of any potential challenges.

Stronger Political Power amongst Local Technology Companies

Technology entrepreneurs had a very noticeable presence at this year’s meetings, demonstrating the government’s ambition to gain an edge in almost every area of the technology sector.

Richard Liu Qiangdong, founder and chairman of China’s largest e-commerce platforms –  JD.com – was nominated to represent the industrial and commerce alliance while Ding Lei, founder and chairman of the country’s second-largest mobile game publisher – NetEase – was selected to represent the news and publishing industry.

For international technology brands, it is important to understand the changing political and influence landscape so they can connect with and build relationships with the key players.

Technology is our largest practice at Racepoint Global. Not only do we help international brands such as Lattice Semiconductor and Applied Materials navigate the challenges in China, we also help Chinese brands such as Huawei and China Mobile International successfully bridge to international markets such as the US and UK.

CSR and Sustainability

In the government report delivered by Premier Li Keqiang during the two meetings, he said China would reduce the population living below the poverty line in rural areas by 10 million. He also said China would increase support for vulnerable groups including the elderly, disabled and seriously ill. These promises will help deliver President Xi’s target outlined in November to eliminate absolute poverty by 2020.

In addition, Li stated that the government was paying particular attention to reducing the nation’s reliance on dirty coal in its goal of cutting persistent smog.

These areas represent opportunities for international brands to showcase their commitment to China. More investment in and focus on Corporate Social Responsibility and sustainability campaigns will not only elevate brand visibility but also win favor and trust from the local community and government.

At Racepoint Global, our communications professionals are highly-experienced in supporting the development and implementation of CSR & sustainability-related initiatives that take into account the nuance of the market, local policy, and cultural norms.

It’s clear there is a significant change starting to happen in China and with all times of change, those companies that understand the nuance, will be the first to spot and seize the opportunities that will inevitably present themselves.

If you’d like to know more about the challenges facing US brands in China, Racepoint Global is hosting a Summit in San Francisco on 12th April. Click here to find out more and to register your attendance.