Risk it in Hongkong or Chinese SOE?

Hi everybody,

Since 2 years ago I have felt very attracted to project finance and IB in general. I took a class in project finance, and read some books, but I don't have an economics/finance background. I am currently a PhD candidate at a top university in China, and recently got a scholarship to go to HK PolyU on exchange for one year. I was planning to use that time to prepare the CFA and network and research about my opportunities to break into project finance, without coming from a finance background(I have a bachelors in architecture, master in construction engineering, and my current PhD is in management science at the school of civil engineering. Have lived in Spain, US, Japan and China).

But suddenly, an offer came from a major Chinese SOE contractor (Top 3 worldwide, but mainly because inner market) to join their business development department, and it would most likely require to travel abroad (still not sure if relocating).

The other issue is that I just reached my 30s so I might be way older than the people I will competing against for positions at PF or IB. Maybe, although kind of late, the SOE job might give me good chances to do an MBA 2 or 3 years from now at a good business school (not sure if good MBAs like LBS, HBS, Wharton or even HKUST will value this experience but I am positive very few foreigners have this kind of exposure to China) and then move into banking.

So my question is: Where do you think I will be better off? Am I trying something impossible with the project finance thing? Of course Chinese SOE pay is nowhere near a IB role, and the promotion opportunities are not well defined...

Thanks everybody!

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Comments (8)

Apr 13, 2014 - 7:50am

Once you go into the SOE circuit, I don't think you ever come back out. If your international experience has given you a positive taste of non-Chinese culture (particularly SOE culture, which is usually not too dynamic), I'd avoid the SOE offers.

Those who can, do. Those who can't, post threads about how to do it on WSO.
Apr 13, 2014 - 8:26am

SSits:

Once you go into the SOE circuit, I don't think you ever come back out. If your international experience has given you a positive taste of non-Chinese culture (particularly SOE culture, which is usually not too dynamic), I'd avoid the SOE offers.


What do your mean by I will never come back out? Would it look bad on my CV?
Apr 13, 2014 - 7:18pm

Looking at your position, you're positioned well to market yourself as a dual-minded half-mainland Chinese-, half-Western -educated/thinking package. That's highly attractive to a lot of Western banks looking to do business in China through staff they can trust as suitably 'dual culture' in that way.

If you go into a Chinese SOE:

- In future, I suspect you'll be viewed as if the outside education was a brief period and you're much more mainland Chinese in mindset than Western, which is generally not perceived as a positive in Western organisations UNLESS you're well networked within China in a way that will bring in business

- your career progresses in an SOE through Chinese internal SOE networking, which is generally not transportable outside of the SOE and emphasises patrongae networks over technical skill/competence

That is, one you go into an SOE, it's hard to get out of both that sector and mainland Chinese company circles. If you're cool with that, go with it. But if you've enjoyed the experience you've had with Western ways of thinking and want to blend east/west more, stay out of the SOEs.

A bus dev role in an SOE may be a little different, particularly if you're working for one of the many SOEs that are acquiring offshore. However, you're still going to be in an SOE framework and incentivised to work in the way that your SOE bosses like to get deals done, which again doesn't do much to develop your technical skills or other skills transferable out of the SOE system.

Of course, this is based on my experience with Chinese SOEs and a lot of my prejudice against them. The origins I my prejudice against SOEs is that I worked on deals with SOEs (from a position in a Western IB) in both Hong Kong and New York, plus generally watched the Chinese SOE story as they devoured the loan capital of Chinese banks and starved the Chinese private sector of capital.

Others may have different and more informed views than I, particularly on exit ops.

Those who can, do. Those who can't, post threads about how to do it on WSO.
Apr 13, 2014 - 7:24pm

I'm assuming you're native born Chinese. If not, that pulls the rug out from underneath my analysis.

That said, I'd then warn you off joining an SOE on a long term basis. I think it would be interesting for a 2-3 year period, particularly as a live and learn experience in a very different mindset to organisational management (vs European, Anglo-American and other organisation management), but make sure you're on a path to MBA at the end of that period.

Those who can, do. Those who can't, post threads about how to do it on WSO.
  • 1
Apr 13, 2014 - 8:45pm

Thanks SSits! Great reply! In fact I'm not Chinese, and I did look at it as a interesting personal experience, and given the fact that I'm foreigner I though I could get more deal exposure and contacts, but it is just a hunch. I would definitely go for the MBA, but as I said, I would be applying with 32-33, maybe too late plus I don't know if quitting my PhD will hurt my application.
Won't you be in Beijing by any chance? Seems you have good experience with them, and would like to know more.

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Apr 13, 2014 - 9:28pm

Thanks for the SB (assuming that was you).

I've relocated to New York, so unfortunately I'm not in your hemisphere for a meet up.

As you're a foreigner whose studied in China, has a non-traditional and interesting educational background, I heartily recommend going into the SOE for a few years with a clear exit plan for MBA. It will make you a more eclectic person than you are already, plus will position you well for interesting stuff later in your mid-30s, whether investment banking or a wide range of other stuff.

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