Working in China
Following the ‘reform and opening-up’ policy introduced in 1978, China has transformed itself from a Soviet-styled planned economy to a prosperous market-orientated economy. China overtook Japan in 2010 to become the second biggest economy in the world, with a GDP of almost twice that of Japan’s in 2013. Growth has since slowed but demand for goods and facilities to service China’s 1.38 billion population.
The Chinese government has made travelling to and working in China much easier in recent years. However, to qualify for an employment (or ‘Z’) visa, you must obtain an official invitation to the country, together with an employment licence of status as a ‘Foreign Expert’. Manufacturing, engineering, pharmaceuticals, environmental technology, IT, finance, production and product and quality management are all valuable ‘hard skills’ for working in China.
China has approximately 7,000 expatriates and recently ranked as the best overall destination for employment and raising children abroad. Many multinational companies are relocating to China or moving their headquarters there and sectors such as banking, financial services, accounting and legal present a growing demand for foreign talent, particularly for individuals with language skills.
For entrepreneurs, the country also offers a myriad of possibilities in selling, trading, investing and franchising to foreign companies. A fast growing consumer market with a vast population, China is forecast to become the world’s largest luxury goods market by 2020. Strong government investment and strong ICT sector growth also offer obvious inroads to foreign businesses, whether SMEs or multinationals.
China presents an exciting mixture of sights and sounds, with an array of cultural wonders, spectacular natural scenery and futuristic cityscapes. Nevertheless, living in China will undoubtedly present some form of culture shock to most Westerners. Guangzhou, Shanghai and Beijing are heavily populated, expensive cities that can take some getting used to. China’s official language, Mandarin also presents both a written and spoken language barrier to many.
China has five temperature zones: The Cold-Temperate Zone: The north of Heilongjiang Province and Inner Mongolia; The Mid-Temperate Zone: Jilin, northern Xinjiang and most of Heilonjiang, Liaoning and Inner Mongolia; The Warm-Temperate Zone: Middle and lower reaches of the Yellow Rive, Shandong, Shanxi, Shaanxi and Hebei Province; The Subtropical Zone: South of Qinling Mountain-Huaihe River, east of Quinghai-Tibet Plateau and The Tropical Zone: Hainan, southern Taiwan, Guangdong and Yunnan.
In China’s capital Beijing (which lies in the Mid-Temperate zone), temperatures range from 0C in winter to 40C in summer. China’s Cost of living index (excluding rent) varies by region, ranging from 44.26% in Guangzhou to 60.49% in Shanghai. Crime rates are relatively low. Chinese Confucianism promotes shame instead of punishment, which seems to deter criminals.
China offers a wide range of cultural activities. Amazing man-made modern architecture (such as the skyscrapers, hotels and towers in the Bund, Shanghai) competes for attention with both ancient historic structures such as The Great Wall of China, The Terracotta Army in Xi’an, and The Forbidden City in Beijing and natural wonders such as the Li River in Guilin, the Yellow Mountains National Park, and Chengdu - the home of the giant pandas. Not to mention the delights of Chinese cuisine. Chinese food is traditionally categorized into five flavours: sweet, sour, salty, spicy and bitter. Spicy, chilli enhanced food is prominent in central and south China, particularly Sichuan, Hunan, Yunnan and Guangxi provinces. Salty food is more common in coastal areas and northern China; sweet dishes are popular in Eastern regions including Fujian, Zhejiang, Jangsu, Anhui an Guangdong and sour foods are common in the southern minorities and Shanxi Province. Bitter flavours are commonly associated with Chinese medicine.
Popular dishes include sweet and sour pork, gong bao chicken, ma po tofu, wontons, dumplings, chow mein, Peking duck and spring rolls. If you want to meet up with other expats, the China National Tourist Office offers a number of tours that will allow you to discover China’s many attractions in the company of other tourists. International groups such as Meet Up and Internations may also be helpful to meet groups that may want to meet up for a coffee or a drink and find people with similar interests to explore the country with in your spare time or at weekends.
The Chinese government stipulates a five day week of 8 hours per day or less and no more than 44 hours a week. The country observes standard business hours of 8am to 6pm, with a lunch break between 12pm and 2pm. Local variations may apply.
Chinese employees are entitled to 11 paid public holidays. Annual leave is 5 days for employees working between 1-10 years, 10 days for 10-20 years, and 15 days for more than 20 years.
It is a good idea to provide the Chinese company you are meeting with objectives, names and ranks of the participants and special areas of interest or you may be provided with a formal briefing.
Punctuality is the norm and it is usual to be introduced to the most senior person first. If you cannot work this out, it’s likely to be the person sitting opposite you. Business cards are essential and should be exchanged at the beginning of meetings where the participants have not met before. These should be translated into Chinese as many Chinese people do not read English. Cards should be presented with both hands, with the Chinese side face up.
Greeting your business counterparts with phrases such as ‘Ni Hao’ (hello), ‘Zao Shang Hao’ (good morning) and ‘Xia Wu Hao’ (good afternoon) are good ice breakers and Chinese tea is normally offered. The tea leaves can be pushed out of the way with the lid of the cup.
Accommodation/Where to live/Housing
China’s main expatriate areas are it’s main cities, Beijing and Shanghai. Beijing is the centre of Chinese government and cultural life. Impressive modern skyscrapers are interspersed with labyrinthine hutong neighbourhoods that date back hundreds of years. Unfortunately, the city also experiences high levels of pollution, with harsh winters and occasional dust storms.
Shanghai is China’s largest city and is a flourishing commercial and financial centre with a fast-paced business and social scene. Futuristic skyscrapers, Asian temples and old-style Chinese neighbourhoods offer escapism from the realities of the business world and expats can choose between several styles of luxury villa in addition to apartment living.
China’s key airport hubs include Beijing, Shanghai, Guangzhou and Hong Kong, all of which were among the world’s top 20 busiest airports in 2015. Direct trains operate to Vietnam (Hanoi), Ulan Bator (Mongolia) and Pyongyang (North Korea). China’s new bullet trains allow fast, convenient, economic travel to many central, eastern and north eastern area, although it’s advisable to fly between Beijing and Guangzhou or Shanghai to Chonquing, which are miles apart.
Buses are available and economical but theft, uncomfortable conditions and safety issues pose a problem. Road conditions may be poor in remote areas. Subways are available in many cities and offer English signs, maps and English speaking attendants. Taxis are comfortable and secure and are relatively inexpensive. Metered fares are the norm and it is not customary to tip.
Customs/laws to be aware of
Beware of black taxis, i.e. unlicenced drivers and be sure to opt for licenced green/yellow ones. Also be wary of establishments such as tea houses that refuse to take cash and then charge a large sum to a customer’s credit card.
With tours, you may get what you pay for, with cheaper tours involving walking across half of a city. Ticket touts, pickpockets, fake beggars and counterfeiters who return fake notes as change and overpriced hotels and tourist menus are also to be avoided.
Many companies employing expatriates have their own medical facilities and a number of foreign healthcare providers cater mainly for expatriates and visitors.
Healthcare in main cities is satisfactory and hospitals in Beijing, Shanghai, Guangzhou and some other cities employing international medical staff have VIP wards in which foreigners can be treated. However, emergency treatment may be inadequate. Ambulances don’t carry sophisticated medical equipment and are often unavailable.
Most expatriates will need private health insurance, including evacuation to specialized hospitals in Hong Kong if necessary. Many Chinese hospitals don’t accept overseas medical insurance and some Chinese companies don’t cover foreign nationals for serious long-term illness.
In an emergency, call 110 for the local police, 120 for an ambulance and 119 for the fire department. If you lose your passport, you’ll need to report the loss in the nearest Public Security Bureau as soon as possible to obtain a lost passport report.
Visit the Foreign & Commonwealth Office website for the latest advice for British people living in China.
Four main banks offer personal and corporate banking facilities for expatriates in China: The Bank of China, CITIC Industrial Bank; HSBC and Standard and Chartered. To open an account you need to complete a signature card, show your passport and make the required deposit, depending on the bank and type of account you are opening.
China’s banking system is slow, with restrictions on available services. 24 hours notice is needed to withdraw USD 5,000 or more (Bank of China) or UDS 10,000 or more (CITIC). It may also take several weeks to cash a bank draft drawn on a foreign bank.
Seven main foreign credit cards are available in China including Visa, MasterCard, American Express, Diners Club, JCB, Federal and Million. Although generally not accepted in rural areas, they can be used to shop, withdraw money and perform other transactions in most major cities.
Employment contracts state what percentage of an expatriate salary can be changed to foreign currency. Most banks are open Monday to Friday: 9am to 4pm (or 5pm), although some close for an hour between 12pm and 1pm.
China taxes individual income progressively at 3% - 45%. Capital gains are taxable at 20%.
Individuals living in China for less than 90 days (183 days if there is a double taxation agreement in place) are taxed on income sourced within China but income paid by an overseas employer is exempt. Those living in China over 90 days (183 days if there is a double taxation agreement in place) are taxed on income sourced within China. Directors and senior managers of a Chinese domestic enterprise are also taxed on income sourced outside China.
Individuals residing in China for more than one but less than five years must pay income tax on income from Chinese and foreign employers for work conducted in China and on income paid by Chinese employers during any paid absences from the country. Income obtained from a foreign employer during a temporary absence is not taxable. Those who have resided in China for more than five years continuously are liable for income tax on all global income for the specific tax year.
Education is highly prized in China, though many expats choose to send their children to international schools due to the language barrier and the high pressure Chinese education system.
China’s international schools have an excellent reputation, in urban centres such as Shanghai and Beijing. British or American curricula can be chosen (sometimes French or German) and many schools offer the International Baccalaureate (IB). Tuition is expensive and can reach around 30,000 USD per year.
[All reported figures were accessed in May 2016 and will be validated in May 2017. We make no claims as to their accuracy as they rely on third party sources.]
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