Bridge Builders:
Stephen Perry

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Breaking the ice

The 1950s pioneers who defied convention to forge trading bonds between China and the West

Words by Elizabeth Mearns and Gary Parkinson

It makes poetic sense that the Cold War created icebreakers.

In the early 1950s, the United States imposed a trade ban on China, with the United Nations subsequently following suit for the duration of the war on the Korean peninsula. When that ended in 1953, the UN lifted sanctions, but the U.S. did not, unilaterally maintaining its embargo until 1972. 

But that didn't stop the most determined people from reaching out. 

In 1953 Lord Boyd-Orr, the first director-general of the UN Food and Agriculture Organization, took 16 British business representatives including Jack Perry to China to discuss trade. The following year, Perry was among a group of 48 British businessmen who traveled to Hong Kong and, from there, took another four days to reach Beijing, helped by an emissary of premier Zhou Enlai.

That groundbreaking mission helped deliver grain, medicines, copper and machinery to China, but it was so much more than that. Calling themselves the "icebreakers", the British pioneers coalesced into a business association, The 48 Group Club, which supports Sino-British relations to this day.

Moreover, it established a modern trade route that would come to change the face of global commerce.

The icebreakers signed a pioneering deal to trade with China.

The icebreakers signed a pioneering deal to trade with China.

The icebreakers signed a pioneering deal to trade with China.

"The Iron Curtain and the Bamboo Curtain would be less dangerous if there were more wagons crossing over them carrying goods from one side to the other. Trade increases understanding."
Lord Boyd-Orr, director-general of the UN Food and Agriculture Organization, 1952

Workers assemble thermostats in Tianjin, 1960. /Keystone-France/Gamma-Rapho/Getty

Workers assemble thermostats in Tianjin, 1960. /Keystone-France/Gamma-Rapho/Getty

Workers assemble thermostats in Tianjin, 1960. /Keystone-France/Gamma-Rapho/Getty

China mechanized agriculture rapidly.

China mechanized agriculture rapidly. /Keystone-France/Gamma-Keystone/Getty

China mechanized agriculture rapidly. /Keystone-France/Gamma-Keystone/Getty

First trade

Stephen Perry spent his childhood witnessing his father's unusual role as one of the original 'icebreakers'. Jack Perry's adventure started at the beginning of the 1950s, with that Western trade embargo. The first premier of the newly formed People's Republic of China, Zhou Enlai, sought to establish a new way to trade with the West. 

"In 1951, my father met with Zhou Enlai's private secretary, who came to London to ask people in Cambridge for advice on somebody who could reopen trade with China," Stephen Perry tells CGTN Europe. "And for a man who'd never really been out of the East End of London, it was an incredible experience and an incredible opportunity."

When Jack Perry arrived in China in the early 1950s, even the devastation of Europe in 1945 didn't prepare him for the destruction that had been visited upon China.

"The country was completely bombed to bits and there was disease everywhere," says Stephen Perry. "The famine and lack of food and no transportation – it was a country really in a bad way. 

"But it was a country that was putting itself back together through the hard work of the Communist Party and the people of China. They really worked. And he was so impressed by the endeavors that they had – he said 'It's the poorest country I will ever go to, but I've no doubt that they will achieve their objective of returning as a leading economy of the world again.' And they have."

London Export was the first company formed to start trade, "and through that, my father was able to support the growth and development of what became the 48 Group Club." The icebreaker mission was what made the group famous, and while the war in Korea made it difficult for Jack Perry and the 48 Group Club, over time he changed minds.

"He was able to impress people that this was not only a great opportunity for the UK, but that China would probably be the most significant country in the world economy by early in the next century," says Perry. "I think people thought he was a little bit mad, but he obviously had it right."

China in the 1950s was ready for modernization.

China in the 1950s was ready for modernization.

Father to son

In the early days, Jack Perry's icebreaking mission wasn't easy – "You had a lot of people to convince that they should take China seriously" – but one person that was less difficult to persuade was Jack's son Stephen.

"It's been my life since I was probably about 14 or 15 – even maybe from when I was five or six, learning about China from my father," he recalls. "I'd been working in my father's warehouses during the school holidays, and that was interesting and enjoyable, but then they asked me to go into administration. And I worked for a year between school and university in shipping, and when I was at university, I carried on a lot of my responsibilities because I was just fascinated by it."

It was during university that Stephen first visited China with his father. "I went to Beijing in 1972 – 50 years ago now – and I was part of the group that sold the first commodities from America to China. And being around the [U.S. President Richard] Nixon mission and that background made me feel a part of history."

The younger Perry was hooked, and soon after that he went to work in the U.S. to build trade between America and China. 

"It was fascinating – learning about America and learning about China and finding ways to bring the two countries together and trade. It was icebreaking, but in a sense it was very easy, because it was so enjoyable. I met such interesting people – and occasionally I did a deal," he laughs.

Jack Perry (third from left) at a meeting in Beijing, 1991.

Jack Perry (third from left) at a meeting in Beijing, 1991.

Jack Perry (third from left) at a meeting in Beijing, 1991.

A member of the Gudao Women's Oil Production Team hears crude oil flowing in Dongying, Shandong Province, 1975.

The Gudao Women's Oil Production Team in Dongying, Shandong Province, 1975. /VCG

The Gudao Women's Oil Production Team in Dongying, Shandong Province, 1975. /VCG

The pivotal 1970s

As part of the second generation of icebreakers in the 1970s, Stephen Perry faced different problems to his father. 

"What was amazing to me in my first visit to China in 1972 was that every inch of the ground was used for agriculture, that there were millions upon millions of people working in the fields everywhere you went. 

"The other thing that amazed me was the amount of knowledge they had about the UK, about the United States and about international relations. And it was the first time that I began to think that the Chinese really had something special. 

"And they do – they study in a way few other countries do… They really want to know what worked and what didn't work in the world. And it wasn't ideological, so you were aware that the Chinese were trying to solve problems."

Even so, at this time it wasn't a country geared up for foreign trade. "The only building over three stories in Beijing was the Beijing Hotel. And there were more horses and carts in the streets than cars… and lots of bicycles," he smiles. "By the turn of the century, they were really becoming equipped to provide for the foreigners what they would need to do the deals and to live in China."

After 1976 China experienced reform: opening up was being planned and implemented from 1978 onwards, and Perry saw great opportunities in an open China. 

"I was trying to put together the first big joint venture in China for the domestic market," he says. "I wanted to understand how the party worked in order that I could put up proposals that used not only the foreign interest, but also the Chinese interests. That was what I decided was my main mission: to understand China and how it worked. And that's been a long journey – it's been 20, 30 years."

Industrialization in the 1960s and 1970s boosted China's economy.

Industrialization in the 1960s and 1970s boosted China's economy.

Mechanization and urbanization

China was to surprise him again in the period after 1978 – and catch the attention of the whole world. China transformed agriculture and mechanized it, moving 800 million people off the land into towns and cities and building the biggest export industry in the world. 

"I mean, if the Chinese had told us what they were planning to do, we would have laughed, just said it's impossible," he recalls. "But they did it, and they did it in 30 years. It is absolutely amazing."

Perry has also seen those changes gather momentum. "The real transformation for the Chinese people started in the 1990s. That's when opening up accelerated and living standards made significant improvements."

The rapid mechanization of agriculture meant China's population urbanized at an astonishing rate. In 1978, only 17.9 percent of the country's population lived in urban areas; by 2020, this was 60.6 percent. 

Deng Xiaoping, China's leader from 1978 to 1989, led the country's opening up – firstly in rural areas and later in cities, and spreading from the economy to political, cultural, social and other fields. China launched special economic zones in coastal areas like Shenzhen, opening the economy to the outside world. While China's 1978 gross domestic product accounted for only one percent of the world's total, by 2020, it was 18.3 percent – helping to lift around 800 million Chinese out of poverty.

The ability of the Chinese to transform their economy has never failed to impress Perry. "They have the best grasp of what it is they want to do, and it's based in reality, not in fantasy. And then they go out and they do it," he marvels. 

"They test it and they change and they alter but they're absolutely committed to being the most advanced, modernized economy by 2049." It's an aim he doesn't doubt the Chinese will achieve.

In December 2001, China joined the World Trade Organization (WTO) – and perhaps curiously, Stephen Perry was worried. He thought that Chinese markets would be taken over by foreigners, he didn't believe the Chinese fledgling factories would be able to deliver the type of packaging and goods that the advanced world had – and he wasn't alone.

"Everybody thought it would be a really difficult time for China," he says. "Actually, China drove straight into the middle of it and became the largest exporting nation.

"I think that the WTO entry was a transitional period for China's foreign trade. But if they hadn't got into WTO, they would have done something else. China doesn't work with one plan. It usually has five or six. But this one, the first plan worked. I think the Americans were enlightened in letting China into it. I don't think America suffered because of China entering the WTO."

In 1978, Shifeng Tea Farm in Tongshan County planted tea scientifically, increasing quality and output. /VCG

Scientific tea planting in Tongshan County, 1978. /VCG

Scientific tea planting in Tongshan County, 1978. /VCG

Deng Xiaoping meets UK PM Margaret Thatcher in Beijing in 1984. /China.org.cn

Deng Xiaoping meets UK PM Margaret Thatcher in Beijing in 1984. /China.org.cn

Deng Xiaoping meets UK PM Margaret Thatcher in Beijing in 1984. /China.org.cn

England's Watford FC plays a friendly against Shanghai, 1983.

England's Watford FC in Shanghai, 1983. /Paul Popper/Popperfoto/Getty Images

England's Watford FC in Shanghai, 1983. /Paul Popper/Popperfoto/Getty Images

Raise the Red Lantern has been a global success.

Raise the Red Lantern has been a global success.

Raise the Red Lantern has been a global success.

More than trade

The 48 Group Club hasn't just been about trade – it has also made strides in cultural and sporting exchanges. 

"We went to China and did the first football match between Britain and China – Deng Xiaoping was there," Perry recalls. "We've done several football matches with Elton John and Graham Taylor, with Watford, Liverpool, Arsenal. They've been wonderful moments of bridging the cultural and sporting divides between our countries and giving the opportunity to create closer relations between the peoples of the two countries."

The cultural exchange included arts and theater, with Andrew Loyd Webber's musicals such as Jesus Christ Superstar and Phantom of the Opera taken to China in the 1980s followed by the full Broadway production of Alain Boublil and Jean-Marc Natel's Les Miserables playing in Shanghai in 2002.

The cultural exchange has flourished in both directions, with Raise the Red Lantern – a ballet based on Su Tong's novel Wives and Concubines – traveling from China to great acclaim in Britain.

"It's been a great experience which hasn't just been about trade," smiles Perry. "It's been about bringing the peoples together and the cultures and the sports together."

As someone who has traveled to China hundreds of times over the past 50 years, meeting and socializing with Chinese people around the country, Perry believes there are some elements of Chinese culture that could benefit British society greatly. 

The first is the abundance and availability of healthy and fresh food. Chinese food has been dominated by the cuisine of Hong Kong, but Perry insists other regions of China have lots to offer too.

"I think what we need to see is more understanding of healthy foods from China being available in restaurants in the UK, and I think that will happen," Perry explains. "Xi Jinping has said 'One of our greatest exports is our culinary capability.'" 

Perry also believes that Chinese healthcare can have huge health benefits in the UK, by turning some medical diagnostic procedures on their head. "British doctors and so on are all positive about Chinese traditional medicine, but they say they don't really understand it," he says.

"Chinese traditional medicine is based on understanding the root causes of the way the body operates, as opposed to the Western system, which is based more on the symptoms that people experience and managing those."

Perry has dabbled with Chinese traditional remedies, and has been impressed with the results. "If you take tai chi, which is the great exercise thing that you see older people doing – there is, with that, a health system and a breathing system that is about taking the strength of the body to areas which are weakened."

China's urban population jumped from 17.9% in 1978 to 60.6% in 2020.

China's urban population jumped from 17.9% in 1978 to 60.6% in 2020.

'Win-win' business with China

The Chinese system is very different to that of Western economies. The concept of a managed Chinese state goes back 5,000 years. Perry insists that understanding Chinese culture is an important part of doing business there. 

"You have to understand what is motivating China and what is in the thoughts of the Chinese leaders and how you can operate with your interests to match their interests," he explains. "A good deal with China is one in which both parties benefit, but they get different things from it."

This is a very different form of business to the small-state market capitalism often practiced in the West.

"Western business people need to understand and absorb the Chinese objective and put it into the joint venture. Once you understand what China is trying to do, you have a good chance of being able to put together deals which will last 20, 30, 40 years, as I have done."

Perry, who was the only Briton among 10 foreigners awarded the China Reform and Friendship Medal in 2018 to mark the 40th anniversary of the economic reforms, describes his attitude to China as a 'think tank' approach, which tries to understand what it is that they are trying to do.

"I'm reading all the material from the National People's Congress and also the Consultative Conference," he says, "because I do not want to be misled by believing what's in the newspaper reports about China. I want to read the original text. I don't speak Chinese, I don't read Chinese, but I know where you can get good information about China – and I devour it."

Perry has met many people who genuinely understand how to work successfully with China to produce a mutually satisfying win-win outcome. 

"If you're not trying to achieve win-win, then you're going to have trouble in China," he warns. "Most businesses are operating on the basis of win, but China has a much better understanding of what win-win means. It's not just a phrase, it's a reality of something that will be sustained."

Some Western governments have taken to restricting Chinese businesses from their domestic markets: in 2020, the UK announced it would remove Huawei equipment from its 5G network. Perry says such decisions have to be made extremely carefully.

"We have to take care of our own security, we have to be careful – but if in the process we kill our relationship with China, we will have gone too far. And that may be where we are today. We are rightly concerned about our own security, but maybe we're over-concerned and we were trampling on some of the fertile ground that is being created by people like the icebreakers and others."

Shipping containers in Hong Kong. /Kin Cheung/AP

Shipping containers in Hong Kong. /Kin Cheung/AP

Shipping containers in Hong Kong. /Kin Cheung/AP

Xi Jinping and then UK PM David Cameron admire football's former World Cup trophy in 2015. /Joe Giddens/Pool/AP

Xi Jinping and then UK PM David Cameron admire football's former World Cup trophy in 2015. /Joe Giddens/Pool/AP

Xi Jinping and then UK PM David Cameron admire football's former World Cup trophy in 2015. /Joe Giddens/Pool/AP

A wind farm in southeastern China's Fujian Province, March 8, 2022.

A wind farm in Fujian Province. /CFP

A wind farm in Fujian Province. /CFP

BMW unveils electric cars at the Auto China 2020 show. /Ng Han Guan/AP

BMW unveils electric cars at the Auto China 2020 show. /Ng Han Guan/AP

BMW unveils electric cars at the Auto China 2020 show. /Ng Han Guan/AP

Anything is possible. BYD sells battery-powered taxis and buses  worldwide. /Ng Han Guan/AP

Anything is possible. BYD sells battery-powered taxis and buses worldwide. /Ng Han Guan/AP

Anything is possible. BYD sells battery-powered taxis and buses worldwide. /Ng Han Guan/AP

The future

Having dealt for decades with suspicion and Sinophobia, Perry half-cajoles, half-warns the Western world that working alongside China is the only way to futureproof business. 

"If we understand that China is going to be the trendsetter of the next 20 or 30 years," he says, "that is the country which we need to get alongside and understand what they're doing and why they're doing it, it'll transform the world."

Perry notes the speed and certainty with which Chinese influence has spread in recent years. "If you look at BRI [the Belt and Road Initiative], the new Silk Road that's being built out there, it was first announced only nine years ago by Xi Jinping. It's transformed countries across Asia already and in Europe it's had an impact, South America, Africa. 

Change can be scary, but Perry has words of comfort and advice for those considering partnering up. "You're going to have to be prepared to make some mistakes and recover from them. That's natural – I've done that a lot in my life with China: I've made mistakes, but I've been able to recover from them."

For Perry, who inherited his co-operative zeal from his visionary father, it's time to start handing on to a new breed of similarly widescreen minds. "This process of trying to build a new icebreaker generation, it needs all the benefits of the media to achieve it. They need to be encouraging people to do icebreaking."

For those who take the leap of faith, the benefits could be enormous. "We don't have enough people in this country who have the vision of being involved with China and understanding China. The great opportunities that are there today – that may not be there in 30 or 40 years' time – need to be grasped now by people who have that vision."

Working with Jack

What was pioneering icebreaker Jack Perry like? CGTN asked someone who worked for him

Written by Sun Lan

So how important to China was Jack Perry's icebreaking mission in 1953? 

Professor Liu Baocheng is the dean of the Center for International Business Ethics at the University of International Business and Economics in Beijing – but in 1988, he was a university student invited to work for Perry's London Export Corporation, a leading member of the 48 Club Group. In exchange, one young teacher from Liu's university would get funding from Perry's company to study in the UK. 

"He was teaching us economics and also the global market," recalls Liu. "Both of us were very much impressed with each other. He demanded that I have to work for him – so he started a deal with my university to borrow me from my campus."

The young Liu Baocheng (left) signing shipping documents with a captain for exporting goods to Rotterdam in 1988.

The young Liu Baocheng (left) signing shipping documents with a captain for exporting goods to Rotterdam in 1988.

The young Liu Baocheng (left) signing shipping documents with a captain for exporting goods to Rotterdam in 1988.

In the next five years, Liu worked in Beijing and London. He served as trade manager in the company's oil and food department, a job that enabled him to travel around the world, while building a strong business and personal relationship with the Perry family. 

"I was so much inspired by the entire family's commitment to work with China, to believe in bridging the cross-cultural differences and policy differences between these two countries."

Then Liu also got to know Perry when he wasn't wearing his business suits. 

"Jack Perry was strongly immersed within Chinese culture. He liked Chinese food. He liked the Chinese people who were riding bicycles – actually, in his later age, he didn't like that Beijing was jammed with so many cars. 

"But he was also a bridge in the policy gaps between these two countries. He wasn't only there to break the ice between China and British trade, but also he was helping to break the ice for many multinationals to penetrate into the market."

It was quite a different environment when the original icebreaking trip took place. In 1953, China had undergone the devastating World War II against Japan, not to mention civil war. 

A new China was emerging, but it faced a dire situation both domestically and internationally. At home, the country was struggling to rise from the ashes of wars. Abroad, the international community – particularly the West – was uncertain where China was heading under the leadership of the Communist party, so they imposed trade embargoes and sanctions on China. 

The environment was far from friendly, but it's against this backdrop that Jack Perry and a group of British business people went to China to try to establish trade relationships.

Liu (right) with London Export Corporation colleague Morris Donnelly at Lianyuangang Port, Jiangsu in 1990.

Liu (right) with London Export Corporation colleague Morris Donnelly at Lianyungang Port, Jiangsu in 1990.

Liu (right) with London Export Corporation colleague Morris Donnelly at Lianyungang Port, Jiangsu in 1990.

"Distrust and even hostility was looming large, so a man like Jack Perry who had the courage and vision to conduct trade with China was a very scarce luxury in the global trade. 

"It's not only doing a hit-and-run business but having such a strong commitment, generation after generation, to work with China – and also to serve as the active ingredient to motivate more of the business circle to ally together. On one hand, to strengthen their bargaining power in business this year, which is very noble, but also to fertilize a larger part of the soil to conduct more business and add value to both sides."

Things developed very fast from then on. In 1972, the UK became one of the first Western countries to recognize the new China, and China has transformed from an agricultural society to an industrialized country. 

In the 1950s, China's foreign trade volume was less than one percent of global trade. Today, China's foreign trade occupies nearly 15 percent of the global total, benefitting its trading partners. 

China is now the UK's third largest trading partner, and the UK is the single largest trading partner for China in Europe. And as Liu observes, there's been a change in the trade patterns over the decades. 

"At that time, it was more of China selling the local produce, from tea to silk to porcelain, to the UK. At that time, there were only two Chinese companies who had the legitimate right to import from any foreign country. So China imported the machinery to bolster the Chinese initial industrialization program. 

"But right now, you see that trade almost reversed. China now exports a lot more high-tech stuff – not only to UK, but also to the rest of the world. When I started to work in 1988, we were selling Chinese grain and animal feed to Europe. But after three years, China became a net importer of those raw materials from all around the world because China learned how to grow cows, how to process beef and how to make canned food for export to the rest of the world."

Liu navigating a vessel in the Chinese port of Nantong in 1990.

Liu navigating a vessel in the Chinese port of Nantong in 1990.

Liu navigating a vessel in the Chinese port of Nantong in 1990.

Alongside these changing trade dynamics is the rise in Chinese people's disposable income, as well as China's transformation into the world's manufacturing hub. In 1978 the average Chinese had a disposable income of around $200 a year, whereas now that figure stands at around $5,500 – an increase of more than 27 times. Liu can quantify his own changing income. 

"My personal experience shows China's per capita income has increased," explains Liu. "When I joined the London Export Company headed by Jack Perry, I clearly remember my monthly salary was fifty six RMB, which is less than $10. That was in 1988. And now I earn at least $2,000 per month."

With more money in their pockets, the Chinese are now beginning to spend abroad. Before the pandemic, more than half a million Chinese visited the UK each year and splashed their money on consumer goods. Even during the pandemic, China's purchase of luxury goods from the UK surged more than 40 times. 

And recently, Chinese students' admiration and enthusiasm to study in UK universities have grown steadily. This year saw a record number of 28,000 Chinese students applying to study in the UK, making China the second-largest market for overseas students after the European Union. 

Liu notes that most are self-funded, rather than relying on scholarships from universities; again, this shows the growth in average Chinese household income. 

Liu (third from right) photographed at a party with London Export Corporation colleagues in 1989.

Liu (third from right) photographed at a party with London Export Corporation colleagues in 1989.

Liu (third from right) photographed at a party with London Export Corporation colleagues in 1989.

This year China and the UK celebrate 50 years of full diplomatic ties. As with any journey, there are challenges and possibilities. In the Chinese language, the word for crisis comes in two parts: 'danger' and 'opportunities'. More than ever, in times like this both sides need visionary people who can see through the difficulties and keep the conversations going. After all, as Liu says, the stakes are so high that neither can afford a return to the ice age. 

"It's time for us to see more commonalities, because of the information age which wasn't available during Jack Perry and even Stephen Perry's early years. Now we're facing a far smaller world, we're facing climate change, we're facing the pandemic, we're facing the energy shortage and even the upcoming food crisis. 

"So we have every reason to work together to address the common enemies that we are facing, both from the environment and also from politics."

Credits

Editors Elizabeth Mearns, Sun Lan
Words Elizabeth Mearns, Gary Parkinson, Sun Lan
Interviews Elizabeth Mearns, Sun Lan
Animations and icons James Sandifer
Video editing Paul Izzard, Terry Wilson, Neil Cains
Executive producer Duncan Hooper
Chief editor Guo Chun
Thanks to Stephen Perry, Liu Baocheng