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How can companies successfully do business in China? What factors weigh into this success, and what will China's future mean for international business? Multinational corporations now look toward China with both trepidation and anticipation. The speed and scope of Chinese economic growth is changing the global distribution of power and resources, possibly to the detriment of the major industrial powers. But this same transformation presents tremendous opportunities for companies who understand China well enough to leverage both its accomplishments and its deep-seated problems for corporate benefit.

Longtime China scholar Kenneth Lieberthal brings to bear a unique combination of experiences as former top government official, political scientist, professor of international corporate strategy, and consultant. In Managing the China Challenge, he draws on his deep understanding of China’s political and economic systems and the priorities of local and national leaders to illuminate the strategies foreign companies must master to succeed in the Middle Kingdom.

In straightforward language, using numerous concrete examples to support his ideas and recommendations, Lieberthal cogently presents not only how to benefit from doing business in China, but also how to avoid the serious risks that the endeavor entails. The implications Lieberthal lays out for corporate strategy are wide-ranging and critically important.

Kenneth G. Lieberthal is director of the John L. Thornton China Center and senior fellow in Foreign Policy and Global Economy and Development at Brookings. Before joining Brookings, he was a professor of both political science and business administration at the University of Michigan from 1983 to 2009. He also served as senior director for Asia on the National Security Council (1998–2000). He has written several books, including Governing China: From Revolution to Reform (W.W. Norton, 2nd ed. 2004).

Foreword by Dominic Barton ix
Preface xiii
Acknowledgments xvii
1 Where China Wants to Go 1
2 Growth Drivers and Constraints 11
3 The Operating Environment 48
4 Necessary Changes in MNC Strategy 59
5 Managing Risks 80
6 Looking to the Future 110
Notes 115
Bibliography 133
Index 143
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