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«INTRODUCTION By the end of 1995, the total Chinese population in overseas region (excludes Hong Kong and Macau) is around 38.79 million. As for the ...»

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A Study on the Background and Business Negotiation Styles

of Chinese American

Dr. Lieh-Ching Chang, Associate Professor, Department of International Business Administration,

Hsuan Chuang University, Taiwan


By the end of 1995, the total Chinese population in overseas region (excludes Hong Kong and Macau) is around

38.79 million. As for the Chinese population distribution, there are 29.8 million Chinese in Asia, which accounts for 77% of the total Chinese population. Chinese population in America is 6.93 million, 18% of the total Chinese population.

It is 1.04 million in Europe, 2.

7% of the total Chinese population. It is 0.86 million in Oceania, which accounts for 2.2%;

and 0.15 million in Africa, which accounts for 0.4% (Overseas Chinese Affairs Statistics R.O.C,2007).

According to the statistics provided by Overseas Compatriot Affairs Commission R.O.C (Taiwan) in 2005, the top five countries which Chinese migrated to and its Chinese population respectively are: Indonesia (7,566,200), Thailand (7,053,240), America (3,376,031) and Singapore (2,684,900).

From the above information, we know that there are quite a number of Chinese who migrated to America. The total number of overseas Chinese migrated to America in 2005 was around 337 thousand, which ranks the fourth Chinese immigration country in the world. In addition, according to the result of the “Longitudinal Survey of Taiwanese Migrants to the U.S.”, America has the most number of Taiwanese migrants, around 55%, and is one of the most important overseas countries for Taiwan.

Chinese migrated to other countries for better life. Business and trade are often the vital ways for making fortune.

However, Taiwan is a small island country and the natural resources and demands are limited. Therefore, trade and transnational operation is very important to Taiwan’s economy. In the early years, Taiwan’s processing products export relied mostly on the popularization and purchasing by overseas Chinese which resulted in the success of Taiwanese export sales industry. The sample procurement by Chinese businessmen in the early stages was the key to success.

During the last few years, new Taiwanese migrants in America and other countries and Taiwanese businessmen who invested in overseas countries expanded the popularization of Taiwanese products. In the meantime, Taiwanese export products changed from processing products to machinery equipments, synthetic industrial raw material, modules and components. Taiwan’s own brand name was built up. Investment in overseas market was developed and the government supported people to migrant to overseas countries to start business and to popularize Taiwan’s export products.

Taiwanese and Chinese businessmen manufactured products in overseas countries toenhance the expansion of overseas Chinese business and trade industries. They brought out the interests of overseas economic cooperation and encouraged cooperation interests (Chen & Huang, 1997).

America is the third biggest trading country of Taiwan. Therefore, the economic and trade relationship between Taiwan and America is very close and vitally important. Moreover, from the above we know that the Chinese population in America is quite large and according to the 2000 American general survey, the overall Chinese employment proportion is 61.4% (OCAC,2008). Chinese businessmen have a very close relationship with Taiwan’s economic and trade developments. The offspring of Chinese, the American-born Chinese, are the vital business partners for the transnational operation and the trade business between Taiwan and America. It means Taiwanese have a lot of chances to undergo business communication and negotiation with American Chinese. The chances are also very important.

Background of Chinese Immigrants Chinese formally entered America in the mid-19th century. In 1840, a number of Chinese labors were employed to Hawaii for agricultural cultivation. They are said to be the pioneers of Chinese immigration. In 1850, the same Chinese labors moved to the West Coast of America to work in mine fields. They were later the slave labors in railway construction. By the end of the 19th century, as the number of migrants got larger, the U.S Federal Government decisively adopted the Close-door Policy and controlled the immigration of Chinese and Japanese through legislations such as the Chinese Exclusion Laws (1882) and Gentleman’s Agreement (1908). The Federal Government refused to give the settled Chinese migrants the right to become citizen (1917). The Immigration and Nationality Act of 1952, also known as The McCarran-Walter Act was legislated. It eliminated the limitations made to American Chinese. The situation was changed. By the end of 1960s, the Government restored its Open-door Policy and attracted quite a number of well educated and skilled Asian migrants (Su, 1995).

Immigration and Nationality Act of 1965 abolished the national-origin quotas and terminated the strict number limit to Asian migrants. The adopted preference system emphasized on family reunification and provided the chance for workers with the skills and professions needed by America to migrate to America. From mid-1960 to mid-1980, the high proportion of Taiwanese overseas students in America was due to their excellent education and professional skills which allowed them to migrate to America. That is the so-called “Brain Drain” phenomenon that attracted a lot of attention (Xu, 2005). Since 1984, America began to separate the quota for Taiwan and China and allowed 20 thousand migrants for each of the countries each year. The quota was doubled. In 1987, the quota for Hong Kong was increased to 5000 from 600 each year. It was at the same time the Reform and Open-door Policy of China was initiated, the number of students who went overseas for education was increased rapidly. In addition, The Tiananmen Incident caused many overseas students to apply to stay in America due to political factors. In 1990, America continued to release business and investment immigration which resulted in a large amount of people who migrated to America. With the addition of the “1997 Due Date of Hong Kong”, the Chinese immigration mood was encouraged further. The wealth, education and knowledge of the new immigrants have become important characteristics of the new immigrants. They made huge impacts on Chinese society (OCAC,2003).

Career and Economy Profile of American Chinese Chinese who went to America to make a living in the early stages were labors in gold mining, railway constructing and other employment business. Although there began to be some Chinese who conducted small business by sole-source investment or partnership investment, most of them still sold their labor for living in exchange of wages to solve material life problems. The business in American Chinese society consists of catering trade, laundry service, garment making, medicine distribution, jewelry selling and agricultural industry. Those are the traditional overseas Chinese livelihoods model. Since then the range of economic activities of American Chinese widened, they could be seen in job fields such as government employees and teachers, SOHOs, financial industry, enterprise operation, electronics manufacturing companies, Chinese medicine and acupuncture, tourism services, hotel management and industry and investment etc. Generally speaking, Chinese have the traditional virtues of being loyal, reliable, industrious and frugal.

They have a habit of saving money and like to buy real estate properties (Ci, 1988). According to historical information, early Chinese migrants migrated overseas only to improve poverty. But after the mid-20th century, Chinese immigration showed a diverse trend. Most of the migrants were social elites who sought better development chances (OCAC, 2003).

During the last 30 years, along with the rapid growth of the Chinese population and the increase in the overall education level, the selection of jobs for overseas Chinese are getting more diversified. Their economic status continued to rise and the social influence is lifted. According to the “2004 American Community Survey” established by the U.S.

Census Bureau in 2007, 49.2% of the American Chinese of above 25 years old have college degree (the average in America is 27%). 68.8% of American Chinese of above 16 years old have jobs. As for career distribution, 51% American Chinese are in the management and other professional field (the average in America is 34.1%). 21.5% American Chinese are in the sales and office-work field. 17% are in the service trade field. As for family income, the average family income of an overseas Chinese family is US$ 66,649 (the average in America is US$53,692) and the average individual income is US$26,344 (the average in America is US$24,020). As for real estate properties, 62.2% American Chinese have their own real estate property and 37.8% rent houses. 12.9% of the American Chinese live below the poverty line (the average in America is 13.1%). Generally speaking, the career and family economic situations of American Chinese are better than the average American standard. The main income for American Chinese still relies on general salaries or medium and small business and restaurant management. The average income is acceptable although there is no high-end result. There are not many Chinese who manage large industries or financial groups. American Chinese who are in core career such as lawyer, judge, doctor, senior manager, college professor and top scientist are very rare. Moreover, many Chinese working immigrants are still in the low income and troublesome group (Zhu, 2007).

Population Structure and Residential Distribution of American Chinese By the end of 2006, there are around 3.66 million Chinese who migrated to America (OCAC, 2007). Immigrants from China began to increase rapidly by the end of 1980. In 1997, immigrants from China surpassed immigrants from Taiwan. The amount of immigrants from China surpassed Hong Kong in 1999. In only ten years, immigrants from China became the second biggest Chinese immigrant ethnic group in America. Looking at the Chinese population trend from the past, it appears American Chinese population is increasing steadily. Fourteen years since 1990, the number increased to 1.56 million. The average annual population growth rate is 4.69% (OCAC, 2005).

By observing the location selection for Chinese migrants in 2000, it appears that the degree of compact is relatively high. Out of the 51 states in America, 80% of the Chinese are in eight states. California State accounts the most as 38.94% of the Chinese are there. Also, 15.68% of the Chinese are in New York State. These two states make up more than half of the total Chinese population. Other states with significant Chinese population are Hawaii State, Texas

State, New Jersey State and Massachusetts State. The percentage of the total population, respectively, is as the following:

5.9%,4.22%,3.83% and 3.21%. Chinese population in the rest of the states accounts less than 3% (OCAC, 2003), which represents the compact life-style characteristic.

American Chinese (1) Population Generation of American Chinese Immigrants of the first generation came all the way from home country to the residence country and the offspring born in the residence country are seen as local-born. Therefore local-born Chinese can then be divided into the second generation and the third generation etc. From the 2004 Composition Table for the Estimated Chinese Population Generation in America (as shown Table 1), we can see that Chinese migrants of the first generation consisted around

2.09 million people (62.9%) and there are around 1.23 million (37.1%) American-born Chinese. In addition, there is already a small number of the fifth generation American Chinese. The generation composition structures of Hong Kong and Taiwan are similar in which the first immigration generation accounts for 65%, American-born Chinese accounts for 35% while the forth generation is less than a thousand people. As the immigration of Chinese from China began late, offspring who are born in America is rare. The first immigration generation accounts for 83% and American-born Chinese only accounts for 17% (OCAC, 2005). There are a lot of Chinese of the second generation who were born in America, which makes the American Chinese age structure younger. American Chinese who are younger than 15 years old are around 47.67% (OCAC, 2003).

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