What is Guanxi all about

My name is Calipe Chong and a Singaporean who first came to China in 1989 and then followed by numerous business trips. I took my first expatriate job as a Materials Director for a large US multinational corporate in 1997 and had my cultural shock even though I am a Chinese who is accustomed to Chinese culture and customs in Singapore where Chinese takes up 73% of the population. With a keen interest in history and culture, I want to understand the rationale of the Chinese behavior by reading books, talking to people, observe and analyze.

I share my insights with my foreign friends and they are delighted to learn from me. One of them has suggested to me to publish them on the Internet; and I decide to take his cue. This is the first topics I will like to share with you.

The most talk about and yet not fully understood by foreigners is “Guanxi” which literally translated as relationships. Guanxi is not just a network of relationships among business partners or with government officials that cooperate together and support one another. And it is not something that resulted from the communist administration but rather has evolved through 5,000 years of Chinese history.

Its root originated with the imperial administration that had ruled China for the past 5 millenniums. The imperial administration was removed in 1911 with the revolution that brought down the Chin Dynasty by Dr. Sun Yet Sen. Guanxi was still prevailing under the reign of Kuomintang government and later the Communist Party of China as both governments are still very much authoritative in nature.

The new Stone Age had appeared more that 8,000 year ago but the first known dynasty was Xia which ruled the country from B.C. 2070 to B.C. 1600. Prior to Xia Dynasty, the ruler was selected from the most capable and intelligent men. Ruler Yao had passed the reign to Sun who later passed the kingdom to Yu who was accredited for alleviated massive floods. Yao, Sun and Yu are the most admired and respected rulers in the China history. After Yu death, his son Qi killed the chosen successor Bo Yi and started the Xia Dynasty which ruled the kingdom for the next 470 years. The throne was passed on from one generation to the next to the selected prince and thus created the imperial administration.

The first emperor who had united the whole country was Qin Shi Huang in B.C. 221. Qin Shi Huang was a tyrant and merciless emperor who caused misery to millions of people. It was speculated that he had 3,000 concubines and maids ready to serve him in the palace. The terra cotta warriors were created to guide his tomb and he connected the various city walls to give China its Great Wall. He had set the standards for many emperors to emulate.

The emperors had supreme powers and they had total free will to do what they like. They amassed others wealth to their treasury and every two or three years, officials from various locations would send beautiful maids to the palace. Some of the emperors acceded to their throne through murdering their siblings and relatives or simply rebelled and killed the previous emperor. Thus the emperor defended his throne at all cost and would not hesitate to execute anyone attempting his throne. Not only were the conspirators executed but all their related families, including in-laws, relatives, servants and friends were either be-headed or banished. It was common to see few hundred lives were lost due to relationship to one conspirator alone. This was a strong deterrent to others from attempting to take over the throne.

Henceforth, the whole country was under one man rule and everyone had to obey him. “Do what I tell you and not do what I do” was a very common practice of the leaders. With this form of ruling, the persons whom the emperor liked would enjoy preferential treatment and immense power. Thus one had to continually please the emperor to save guard his position and life while providing luxurious lifestyle for his family members and relatives.

Most emperors did not like to hear bad criticism or reports and there were many cases where the messengers or advisers were executed because of the bad message they had delivered. Handsome reward was often given for good message delivered. First form of tipping in China! As such, subordinates preferred to report only the good news and hid or obscured the bad news, even until today.

There were times that the emperors entrusted the eunuchs, who were castrated male palace servants, so much that the latter played an important role in shaping the country administration. Eunuchs were often bribed to reveal the emperor mood or passing intended formation to the emperor. Some of them were so powerful that they were second in command to the emperor. They were even above the generals and chief minister! One infamous example is eunuch Wei Zong Xian of Ming Dynasty (AD 1368~1644) who had killed many high ranking officials and their families who did not take side with him. It was believed that thousands of lives were killed under his order. This was a classic example on how Guanxi was used in an extreme manner.

Royal family and officials abused their power and caused huge hardship to commoners. Land, wealth, property and children were forcefully taken from commoners. If the officials were caught for any unlawful act or misdeeds, they would bride all the way to the royal family or officials closed to the emperor for amnesty. There was also strong connection between the government officials and the wealthy landlords and businessmen. The landlords and businessmen would provide bribes to the officials who in turn provide them the protection and abuse. Thus any officials who broke the norm and courageous enough to bring the officials to justice were well respected by commoners. One such great folklore hero is Bao Cheng (commonly known as Bao Qing Tian) of Song Dynasty (AD 960~1276). He was worshipped for his righteousness and courage to execute royal family member, eunuchs, high ranking officials and numerous wealthy bullies. He could do it because he was entrusted by the emperor to carry out the morale duty. Till today, films and TV-drama are still being made based on his stories.

One common tactic that the villain used to remove his rivals was to frame the other party with fabricated evidence of attempting the throne. The emperor would not take chance and executed the entire family of the accused official. Thus many officials might reluctantly provide wealth and support to their leaders or peers to demonstrate their loyalty in order to survive. One also had to make sure that he was not in the wrong camp as the power struggle was intolerable of a rival camp. It was perilous not to show association to powerful and influential leaders who would frame or execute anyone not demonstrating the alliance or pledging loyalty. With such high stake, political maneuver was often shrewd and extreme.

Throughout the entire Chinese history, the majority of the population was poor peasants and craftsmen. There was literally no way for them to break the poverty line unless through uprising, turning bandits, imperial examination and of course Guangxi. Every few years, an imperial examination was held to identify scholars with academic intelligence. They would then be offered governmental posts. And they soon learned the Guanxi requirement and the unwritten rules to get to the top.

Thus to understand how Guanxi evolved in China, one has to understand the power structure of the emperor and his relationship with royal family, government officials, generals, landlords and wealthy businessmen. It was a pyramid of power where the emperor was right at the top and the commoner at the bottom. Protection and favor were passed down to next lower level in exchange for loyalty and wealth (bribery in today terms). The higher echelon needed the loyalty from the bottom to stay in power and to fight against his rivals. In return, the lower echelon received the protection and favor to obtain more wealth, influence and status.

Guanxi was the cement that bonded these layers. It contained the ulterior interest, conspiracy, wealth, power, influence and jealousy between the upper and lower echelons. Guanxi was used by individual group to serve their own interest and motives. New member had to pay the cost to join and also consensus from the group. If the group lost the favor from the emperor, it would crumble down immediately and all members in the group perished in the execution square.

On the other hand, Guangxi was also used simply as a relationship among friends and relatives. It facilitated mutual help, networking, financing, resolving disputes, etc. The Chinese lived in a closed knitted society and relied on the network of Guanxi to live by.

Guanxi was also the mechanism that provided the connection in this complex intertwined hierarchy. One needed it to move up the hierarchy, to bully others, to increase wealth, to take others property or family members as slaves or concubines, to be respected by others, to remove his rivals or merely for survival. Guanxi was established through various means such as:

1.        Offering of cash, expensive gifts, land, property and beautiful girls. This was the most common form as greed was man biggest weakness. Gifts or cash were given during festive seasons, birthday, anniversaries or any happy occasions celebrated by the elders or leaders. It was such a strong customs that it was deemed imprudent for someone not to bring gifts in such occasions.

2.       Doing one’s favor. This is a typical example “where you scratch my back and I scratch yours”. It is also a way to secure bondage between two parties. Thus they might help to secure jobs for their friends, match-making, approach friends who were in the authority to help another friend to settle matters or running some chores, settling some disputes, etc. However they would expect favor to be returned when their woes or needs appeared at a later date. Anyone who did not return the favor was considered unfaithful and would be scorned and avoided by others.

3.       Protecting the group. A common practice for the government officials is to discards evidence or trials against their subordinates or peers. Often the plaintiffs were tortured or killed to cover the case. This was to protect the group interest and at times the favor was used as a bargain for favor or to establish Guanxi.

4.       Marriage of their children. This was a common tactic that even the emperors used it to ensure the neighboring countries do not attack them. Princes were married off to those countries to seal alliance. The officials and businessmen used it to pledge loyalty and secured their relationship. Sometimes, marriage vow was made by both sides during the wives pregnancy. When the babies were born, they would either become sworn brothers or sisters if they are of the same sex; otherwise husband and wife if they are of different sex.

5.       Feasting. Sumptuous feasting was a way to show friendship and sometimes a way to show others the relationship one had with the dinners. Drinking was almost mandatory as one needed to show others their willingness to foster friendship. Drinking to Chinese is like sharing a smoking peace pipe to American Indians. The Chinese believe one could see each other behavior on a dining table and especially so when someone is drunk. Thus they would determine whether they could accept each other or not.

6.       Pledging loyalty or admiration. A common ploy by writing a poem, banner or through words of mouth to declare admiration or loyalty. This was often used when one did not have access to the person in power.

7.       Killing the foe of others. A strategic and unilateral move where one killed or disposed a foe of the person he wanted to established relationship with. Alternatively one could declare animosity to a foe of the other party to secure trust and attention.

Though we do not have the emperor today, but the political environment has not changed regardless whether in a government body or business world. I am glad to note that the importance of Guanxi is diminishing with the open and direct interaction that China is making with the outside world. One cannot rely on Guanxi to obtain unlawful treatment or agreement from government officials. Once exposed, both the officials and taker would be brought to justice and could be assured of proper punishment.

Giving gifts of less value to higher authority or elders are considered giving respect in kinds and not bribery. Thus it is very difficult to draw a line to say it is a form of bribery. Not too long ago, it is customary to send mooncakes or food stuff to government officials during festivals. The purpose was to clinch a favor from the officials or to avoid disdain from them. Fortunately such practice is no longer prevailing. Some officials are rejecting the gifts as to follow the directions from central government.

You can use Guanxi to ease the business operation or expediting an application but not to use it for any unlawful means or advantage. It is definitely beneficial to find the right connection to the appropriate government officials to clarify some confusing policies, legislation or an application process. This helps to prevent falling into a perpetual round of application rejection and delay with more money and time spent unnecessary.

The customs on giving a helping hand and showing courtesy will continue to be the norm in China as all gracious societies would do. A welcome or birthday gift is appreciated as a gesture of friendliness. The issue is not to expect favor in return. The immense response from the public in last year May 12 earthquake demonstrated well on Chinese virtue and strength.

China opened up to the new world just 30 years ago from an old culture and customs. But its eagerness to learn and adopt has amazed everybody. The pace of change in the last decade surpassed the change in the past 50 years. May be one day China may go back to the pre Xia Dynasty era when leaders were selected by their virtue, intelligence and capability and not through Guanxi anymore. And that would come sooner than expected.

   Posted on 17 Aug 2009

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