Crackdown in China Stalls Growth of Budding Public Relations Business

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Crackdown in China stalls growth of budding public relations business

Political uncertainty clouds future of "fast-growing field"; U.S. firms take wait-and-see approach In 1987, the China Daily reported that "250 young people engaged in PR, or PR lovers, gathered in a Beijing park to attend the first PR Conference." The newspaper also noted that a new series of textbooks on public relations had sold out in one day and that students were cramming into university classrooms to study "one of China's fastest-growing fields." And in the past year, according to industry sources, there has been a rapid increase in the number of Chinese public relations firms.

But the violent crackdown on prodemocracy demonstrators in Beijing's Tiananmen Square in early June has dealt a serious setback to China's burgeoning public relations industry. "The freer cultural and political environment that gave people and firms the confidence to take public positions and to work with the media has been crushed," says Ron Cromie, director of client services for Hong Kong-based Bentley DDB Needham Public Relations, who has spent the last five years working in Hill and Knowlton's Beijing office. "Unfortunately, it will be some time, probably years, before the recent high level of interest in PR returns to China."

However, other industry experts based in Beijing and Hong Kong say it's still too early to assess the long-term effects of the crackdown on foreign public relations firms, noting that a large part of the Chinese public relations business is closely tied in with the overall trade and business climate. "The future investment in China is a big question mark. Companies are still calling and asking, `What do we do?'" says Lee McConaughy Woodruff, an account supervisor at Porter/Novelli who recently returned to the United States after working the past year at H&K's Beijing office.

The unpredictable nature of the current political situation in China has prompted many U.S. companies to take a cautious, "wait-and-see" attitude, industry sources say. As a result, many of these companies are placing new business commitments on hold and trimming expenses on existing publicity and promotional programs. "There will be a period of uncertainty that is going to have a negative impact on doing business in China. Consequently, PR business in China will slow down terribly," says Derek Fung, manager of H&K's Beijing office. In October 1984 H&K became the first international public relations firm to open an office in China.

"Bootstrap" operations

The public relations practiced in China is unsophisticated compared to Western standards, according to U.S. practitioners. One firm executive describes public relations in China as a "bootstrap" operation. The dissemination of brochures and trade publications are standard procedure. Increasingly, special events are becoming the premier public relations tool used to generate media coverage. China's major media are also eager to receive information from foreign countries, especially about products, technology and successful companies.

Calm before the storm

Prior to June 2, the day China's military unleashed its fire on pro-democracy demonstrators, leaving hundreds of students dead, the future of public relations in China was growing brighter each day. "Chinese industry was beginning to appreciate the importance of brand and corporate positioning and the power of professional PR to move public opinion," says Cromie. …