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Manufacturing work has moved to China because labour is cheap. Already this is changing as labour becomes more expensive and more organised.

Many companies have realised, too, that operating in China has many hidden costs, including poor quality delivery, the need for extremely careful and trustworthy supervision to avoid unsatisfactory or dangerous substitution of raw materials, poor delivery timekeeping, bad descriptions for shipping leading to delays at ports of exit and entry. Product labelling has been a recurrent problem and sourcing of sensitive raw materials is often confused by relationships of a personal rather than a commercial nature. Pre-delivery payments can be a disincentive to prompt delivery. The list is long.

Assumptions that because labour is cheap, management will be cheap too are fallacious. It is rather the other way round. Because the standards of reliability are often radically different from those of the company’s home country management can – and usually should be – more, not less, expensive.

The great Hongs in Hong Kong built their businesses on the labour negotiating skills of the Compradors who themselves became very rich men. Without them trade would have been impossible.

The need for astute and clever management extends beyond the manufacturing area. Consultants, advisers, agents and go-betweens of all sorts are kept far more on their toes in a country where the commercial culture is still being developed and where one man’s promise is often another man’s profit.

Many companies have failed to make a profit operating in China. Some have withdrawn their businesses, making a substantial loss in the process. Those who succeed are generally companies that are used to operating in uncharted areas such as Africa, Russia and South America where systems are seen as something to be circumvented and logical, tidy trading is rare – and where the quantum of agents’ fees are a crucial part of the negotiation.

Cheap management in China is always the most expensive.