Guangzhou Economic Officers Inter-Consulate Dinner

UNCLAS SECTION 01 OF 03 GUANGZHOU 014660

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TAGS: ETRD EINV CH
SUBJECT: Guangzhou Economic Officers Inter-Consulate Dinner

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A) 04 GUANGZHOU 37287 (notal); B) 05 GUANGZHOU 02787
(notal); C) 05 GUANGZHOU 012792 (notal)


1. (SBU) SUMMARY AND COMMENT: Econoffs met with diplomats
from other Guangzhou-based consulates to discuss a wide-
range of South China economic issues. The meeting was the
fourth meeting of the ongoing inter-consulate discussion
group, which at best is held periodically; the last meeting
was held in May 2005. The dinner attracted nine diplomats -
- several of whom attended for the first time -- and the
topics covered ranged from upcoming high-level visits to
intellectual property violations, to dealing with local
foreign affairs officials. The meetings continue to be a
valuable way to informally exchange information and share
insights into the business environment in South China. The
respectable turnout, on a rainy night just after the long
May First holiday, indicates that the entire consular
community finds the meetings useful as well. END SUMMARY
AND COMMENT.


2. (SBU) Econoffs joined our Australian host Christopher
Green, Vice Consul, Australian Consulate at a roundtable
dinner, along with:

Matthew Moody, Consul, Political and Economic Affairs,
British Consulate;

Giovanni Russo, Economic, Financial, and Commercial Attache,
Italian Consulate;

Dr. Robert Weber, Deputy Consul General, German Consulate;
and

Mona Ip, Consul and Senior Trade Commissioner, Canadian
Consulate.

Several other invited guests were unable to attend due to
scheduling conflicts.

Australians Busy Preparing for a High-Level Visitor
-------------- --------------


3. (SBU) Green began the meeting by noting that his
consulate was very busy of late preparing for an upcoming
visit by Australian Prime Minister John Howard to Shenzhen.
While Green did not elaborate or comment on the agenda for
Howard's visit, he did note that Australia and China
continue to negotiate the details of a free trade agreement
(FTA). (Note: The Australia-China FTA negotiations were a
major theme of the visit to Australia 1-4 April 2006 by
Premier Wen Jiabao, Chairman Ma Kaito, and Minister Bo
Xilai, according to the Australian Department of Foreign
Affairs and Trade webpage. The next FTA negotiating round
between Australia and China -- the fifth such round -- is
scheduled to take place in Beijing from 22-25 May, according
to the same website. End Note.)

Reviewing the Recent High-Level Visit to the U.S.
-------------- --------------


4. (SBU) On the topic of high-level visits, Green turned the
discussion to the recent visit to the United States by
President Hu Jintao. Green commented that he had heard
rumors that the Chinese Ambassador to Washington was going
to be recalled and the Chinese Foreign Minister being
replaced because of various incidents that occurred during
the visit -- which the Chinese viewed as mistakes affecting
Hu's prestige. Several members of the group commented that

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they had heard similar rumors, but no one could provide any
new information beyond that statement. The group noted that
while these rumors were circulating worldwide, they were not
been reported in the Chinese press, and they speculated that
this was because the Chinese government did not want the
Chinese general public to view Hu's trip to the U.S. as
anything but a complete success.

What Color is Your "Berry"? IP Problems Persist for All
-------------- --------------


5. (SBU) The group also discussed the topic that inevitably
comes up in such meetings -- problems with intellectual
property (IP) violations. Ip noted that she has been
spending a lot of time working on a problem involving the
popular "Blackberry" wireless handheld device. (Note:
Canadian company Research In Motion Limited, founded in 1984
and based in Waterloo, counts the Blackberry among its
product line. End Note.) Ip explained that the Blackberry
is being copied and sold in China as the "Redberry" an
obvious infringement of the Blackberry, in her opinion. Ip
noted her frustration that, in her experience, people
violating products the Chinese are concerned about -- such
as the official Beijing Olympic mascots -- are quickly
clamped down on, while people copying products such as the
Blackberry, which the Chinese government does not have an
interest in, are often basically left alone.


6. (SBU) Weber noted that the Germans have begun to focus
some of their IP efforts on educating Chinese companies
about the damage IP violations do to their own bottom line.
Econoff mentioned that we have been employing this strategy,
among others, as well, including during an IP conference
last fall during which several major Chinese companies
participated and shared their own IP violation experiences.


7. (SBU) Russo mentioned China's promise to sell only
computers with legal software already pre-installed, to
prevent the pirating of software. He commented that, while
this is a very positive step forward, in his experience this
meant that a foreigner buying a computer in China would have
problems using the software because it is all in Chinese.
Because the consumer theoretically cannot pick out his or
her own software to install anymore, this could be a problem
for the small amount of English-speaking customers for these
products.

Dealing With the Foreign Affairs Office
--------------


8. (SBU) The group also discussed the difficulties we all
encounter at times because of the requirement that we work
through the Guangdong Foreign Affairs Office (FAO),an
office that is often less than cooperative, to schedule our
activities in South China. Moody shared with the group that
he had recently attended a lunch with the FAO during which
officials from the British consulate reviewed a laundry list
of problems they had experienced in dealing with the FAO.
Moody said that in return, the FAO had shared its own list
of complaints about dealing with the British Consulate.
While Moody did not elaborate on what exactly was said at
the meeting, he noted that after airing all their respective
grievances and gaining a better perspective on where the
other side stands, cooperation between the FAO and the
British Consulate has improved greatly. (Note: Before the
May holiday, we requested an informal "get to know you"
lunch with our FAO counterparts, but because of the upcoming
holiday and resulting scheduling conflicts, they were unable
to attend. We hope to reschedule the lunch in the near
future. End note.)

Koala Diplomacy?

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9. (SBU) Green also mentioned that Australia had sent six
koalas from Australia to Guangzhou last month and that his
consulate had been involved in some of the events
surrounding the opening of a koala exhibit at the Wild
Animal Zoo in Guangzhou. Green commented that unlike the
Chinese practice of "renting" out its pandas, Australia will
not be charging China for use of the koalas, but his country
will retain ownership of the animals and any offspring they
may produce. Guangzhou's Xiangjiang Wild Animal Zoo is
reportedly currently building a koala exhibit, which will
cost more than 10 million RMB (roughly USD 1.25 million) and
it will plant 400 hectares (roughly 990 acres) of eucalyptus
trees to provide food for the animals, according to Hong
Kong press reports.

ROCK