Source: The Financial Times   Date: May 5, 2010

Mr. Kevin Wale, head of GM in China, calls the World Expo in Shanghai the “Olympics of technology”. He might as well call the USD55 billion event the Olympics of branding: a chance for foreign multinationals to peddle their products – from Coke that freezes instantly when opened to GM cars that park themselves – to 70-100 million, mostly Chinese, people who will attend the six-month show.

In spite of complaints of a tougher environment in China from some foreign companies, scores of multinationals have invested heavily in the event. Ms. Brenda Foster, head of the American Chamber of Commerce in Shanghai, says the participation of U.S. companies – several have their own pavilions and corporate America contributed more than USD60 million to build the USA pavilion – “is one of many indicators that U.S. companies are increasingly committed to the China market”.

That is one reason why, when U.S. legal restrictions prevented Washington from funding its pavilion from state coffers, Mrs. Hillary Clinton, Secretary of State, was able to pressure corporate America to pay for it. No one wanted America to be unrepresented at Expo – least of all companies that still, in spite of all the hardships, think China is one of the best places on earth to do business. Numerous chief executives of Fortune 100 companies are expected to visit Expo and some foreign companies say they may bring their global board meetings to Shanghai during the event with some meetings to be held at the site itself. 

Ms. Foster points out that investing in a chunk of Expo turf is a good way to “advance your government relations strategy”. Other foreign businessmen put it more bluntly: many multinationals felt they did not dare snub Shanghai and its Expo, the culmination of years of work and spending.

The corporate investment appears to have paid off: many of the corporate pavilions stand out as some of the most lavish, the most technologically advanced and most interesting of the 200-odd

pavilions. Many of the national pavilions are lackluster and unimaginative by comparison.

Expo has even inspired its own line of luxury goods: Chanel has launched an Expo handbag that looks like a Chinese food box and Prada has a tote with grass sprouting in front of the Oriental Pearl Tower, symbol of modern Shanghai (capitalizing on Expo’s theme of better integrating urban life with the natural environment).

But another business leader puts it more cynically: for foreign business, it is plain “prudent” not to stay away.