The gamble
03.03.2010
Joint ventures in China are fraught with danger.
I visited a group of Sisters working in a hospital in a city of about half a million people. Theirs is a strange story as originally they were invited to build and open the hospital under their own management.
How it began
It all began when a superior of a congregation that had worked in the province before the 1949 Revolution, came to China 10 years ago to visit the area, but was carefully supervised by the Religious Affairs Bureau. On his return to Europe he invited the official to visit Germany just to broaden his horizon a little. While there, the official was amazed to find religious congregations running hospitals under the state system. He invited the Order to do the same in China in a joint -venture arrangement.
Joint venture agreement
The sisters came and signed an agreement to build and manage a hospital. They invested $6 million in the project and were within a few days of opening when they were suddenly told they could not do so. The reason given was that foreigners could not be the managers of a hospital and that the contract had been signed with the local city administration instead of the provincial government. The fact that they were religious was another reason.
The local city authorities decided to add another 300 beds and make it a city, not a joint-venture hospital.
The sisters were told the city was taking over the hospital but they could work there under Chinese management. It was a take it or leave it situation, so they decided to stay, having invested seven years in the project - not to mention the money.
Disease and other ailments
The most common disease is TB as the outlying area is mostly populated by peasant farmers. Their annual income is about $250 so their diet and hygiene is poor. They have a lot of stroke cases due to the high salt content in their food. There are the usual venereal diseases but no Aids so far, as the peasants are too poor to travel to distant cities.
Outpatients gets a lot of stabbing and domestic violence cases. There are also a lot of murders and suicides, the latter even among teenagers. Abortion is legal in China and the hospital performs an average of 50 a month - as opposed to an average of 45 live births.
Sisters know best
The Sisters donated beds to the hospital. They wanted beds with a cot attachment but were told by the management this was unnecessary. When a patient fell out of bed the management had a change of heart and now cot attachments are being added. I was surprised to see a number of double beds in a few private wards. I was told the management insisted on having them (never mind the difficulty of nursing a patient in one) as they said they would be needed by important patients to give them status!
Poorly trained
The staff are poorly trained by Western standards. Just three years of study to qualify as a doctor-though one Medical School is now offering a four year course. The pay is very low, just $60 a month. To make matters worse, sometimes the staff is not paid for two months. This has improved recently as they now get about 80% of their salary monthly. The staff gets 20% of the profit from their hospital department, if it makes a profit. Each department functions independently and co-operation can be minimal.
Working the odds
The day I visited there was a heavy snowfall and the staff had been informed by the city authorities that they had to clear the snow from 300m of the pubic highway in front of the hospital. Half of the hospital site had been reclaimed by the city as they were told they had not used it for building. Blocks of flats were erected and sold privately but somehow the hospital management staff obtained free apartments in a deal with the developers. The hospital is allotted workers by the city authorities and has to take them even if they don’t need them. The hospital also has to pay the pensions of the retired workers, as there is no state pension scheme.
Advice not taken
It has to be said that the German congregation was advised by local and Hong Kong Catholics to have nothing to do with the project. They went ahead in spite of this advice.
It shows yet again the foolishness of making decisions about operating in China from a background of European business ethics. The Chinese have no hesitation in signing a contract regarding operations in China, as they know very well they can move the goalposts any time they choose.
A written contract has no validity when it comes to enforcement as the Chinese have 1001 ways of getting around it. Perhaps this is why the majority of joint venture business operations in China are losing money?
Fr Teddy Collins teaches in China.
.jpg)
.jpg)
.jpg)
.jpg)
.jpg)