Negotiations to Set Up Joint Ventures in China

in International Negotiation
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Abstract

Establishing joint ventures in China is an interesting test of cross-cultural negotiation under conditions of uncertainty within a complex network of constraints. On one side is the huge Chinese company, heavily bureaucratic and focused on taking care of all dimensions of its employees lives. On the other side is the Western enterprise focused on quality performance and financial effectiveness. The negotiation process can be distinguished by several stages, each of them related to a specific issue such as the basic policy of the future joint venture, the technical issues, the financial aspects, and the legal aspects. Among the many issues, 16 are considered in this analysis as key issues of crucial importance in the building up of the agreement. A number of difficulties encountered by both parties during the negotiation are scrutinized, such as hidden differences in objectives, the obstacles due to non-overlapping perceptions, the lack of managerial culture, conflicting values behind behaviors, and the decision-making process in an administration-run economy.

Negotiations to Set Up Joint Ventures in China

in International Negotiation

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