Dragon dance for mardi gras
by Terence MacNamee
Today it is mardi gras, the last day of Carnival in Europe, and in Asia they are well into the Chinese New Year celebrations. The other day there was a cartoon in one of the Swiss newspapers: two business types see a dragon rearing its head over a factory and ask each other “is this Carnival?”
This year, indeed, it seems like the Chinese dragon has invited itself to the Carnival parade. The agricultural products multinational Syngenta, which has not been doing too well lately and needed new investment, was almost taken over last year by the American multinational Monsanto, but the takeover fell through. Now the company is being taken over by ChemChina. Ren Jianxin, chief of the state-owned company, was in Basel the other day to close the deal. “Never before have the Chinese offered so much money for a foreign firm” commented another Swiss newspaper.
Some people here are worried about cash-rich Chinese buyers coming here and elsewhere in Europe on the lookout for acquisitions – they are also taking over firms in Germany, but nothing very big yet. People assume the Chinese want more Western know-how for their own growth. ChemChina’s Ren himself said that Syngenta would help modernize Chinese agriculture. Naysayers here grumble that the Chinese buyers have the financial muscle of the Chinese state behind them, so private investors can’t compete, and it’s unfair. There is a general apprehension about China buying up the Western world.
Yet the Swiss government seems to be supporting and facilitating the Syngenta deal, now that ChemChina has reportedly guaranteed that the head office will stay in Basel and there will be no changes for at least five years. Voices have also been raised in support of the deal in Swiss industry, notably those of well-known CEOs Daniel Vasella and Magdalena Martullo-Blocher. Such business figures realize that there has to be give and take. If Western companies large and small dream of nothing so much as “cracking the Chinese market”, they have to give the Chinese a chance to crack the West.