Ties That Bind - Bay Area Council Economic Institute

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Ties That Bind
Dr. George Koo is optimistic about U.S.-China relations, given the two countries’ influence in
the world, the size and interdependence of their economies, and their common strategic interests
in many areas. He recalls an early first trip to China in 1979, just after normalization. He needed
a travel permit to leave Beijing. When he went out for a walk he was followed by a government
handler. In a dilapidated hotel, he tried to set up appointments, but an antiquated phone system
had a permanent busy signal during the first hour of the day because all offices opened at the
same time, at 8:30. He could not deal directly with companies but instead was required to work
through import-export intermediaries.
Things have changed significantly since then. But he repeats the oft-quoted saying, “Everything
is possible in China; nothing is easy,” and he sees constant potential for commercial, political and
strategic misunderstanding.
Dr. Koo, who is currently director of the Chinese Services Group at Deloitte & Touche, was
recruited in 1978 from SRI International (formerly Stanford Research Institute) to do crossborder
consulting for Chase Manhattan Bank’s Chase Pacific Trade Advisors—specifically, to
help client firms enter the China market. He later founded Bear Stearns China Trade Advisors
and worked with H&Q Technology Partners, then an affiliate of Hambrecht & Quist, before
moving to Deloitte. Dr. Koo is currently on the board of Pacific News Service and served
through April 2006 as vice chair of the Committee of 100 (C-100), a nationwide group of Chinese-American
business, arts and community leaders (architect I.M. Pei and cellist Yo-Yo Ma are
among the founders).
C-100 was formed in 1990 to foster positive U.S.-China relations through communication and
exchanges, and to enhance the image, visibility and participation of Chinese Americans within
the U.S. It has commissioned nationwide surveys on American perceptions and attitudes regarding
China; arranged high-level meetings with national leaders in Washington, China, Hong
Kong and Taiwan; sponsored business and cultural delegations; pushed to expand classroom
teaching about Asian-Americans and Asian history and culture; promoted PBS, Learning Channel
and Discovery Channel documentaries on China; publicly supported Dr. Wen Ho Lee against
federal spy charges; and actively lobbied U.S. policymakers on issues related to trade, industry
outsourcing and globalization. In February 2004 it opened a “greater China” office in Hong
Kong, and hosted its first annual greater China conference in January 2005—a companion event
to its annual U.S. conference. In 2005 C-100 launched a national mentorship program for university
students and young adults.
The Bay Area has one of the largest concentrations of C-100 members in the U.S. Dr. Koo believes
that the region enjoys a strong competitive advantage in terms of technological cooperation
with greater China: “Silicon Valley is unique. It’s multicultural and multiethnic in a way that
isn’t comparable in Seattle or Boston. There’s also a far greater acceptance of failure; venture
capitalists will always give you credit for having tried and failed.”
But he shares the concern of many C-100 members, that protectionist political debates over
China’s perceived trade advantage in wages and exchange rates mask deeper problems in the U.S.
economy that erode U.S. competitiveness. Among these are unsustainably high deficits, low