Strange Bureaucratic Rules

Changing money here into US dollars can be a frustrating experience for those uninitiated in the world of Chinese bureaucracy.

It turns out that a person can only exchange a maximum of $500 a day, but perhaps those with guanxi can increase that daily limit to a significantly higher number.

But for us plebians, this is the amount.

The other day I took my 3,420RMB ($500) to the Bank of China. I had to fill out a simple form that included my address and telephone number. Then the teller looked at my passport, entered a few of my details into the computer and a few signatures later, got my five Benjamins.

Yesterday I got to the Bank of China too late and it had just closed, but next door China Merchants Bank was still open. I happen to have an account there and thought the process may be even easier.

However, I was completely wrong.

The teller, granted she was being very meticulous, pointed out that in my computer file showed that my passport number was different and wondered why. I had no answer for her and she corrected it, adding more details about my passport into the electronic file.

She kept asking me if I wanted $500 and I said yes, wondering why so many confirmations.

Then she asked me what the American money was for.

Why did I have to tell her? She explained that she had to write down the reason for the foreign currency exchange.

I later told a Chinese friend about this and she just explained it was because China Merchants Bank doesn't usually service foreigners so the teller was asking more questions, whereas Bank of China is more specifically geared towards foreigners, which is used to doing more foreign exchange.

She gave the analogy that all Chinese banks have a slice of pie and are not allowed to take someone else's slice, or compete for customers. For example, Agricultural Bank of China is focused on farmers and rural areas, China Merchants Bank for entrepreneurs, Bank of Communications for telecom clients, and so on.

This explains why there are so many banks in business in China, and this analogy extends to all kinds of state-owned enterprises, like steel, cars, aviation, power, telecommunications and media.

Most of these state-owned enterprises are bloated businesses, wasting a lot of money on personnel they don't really need, or not concerned about being more efficient because there is no need to compete.

And with that comes the top-heavy bureaucracy.

My friend reminded me that in order to quit her job from a state-owned newspaper, she had to get 20 signatures. Yes, 20. And many of these senior people, most past retirement age and held honorary positions, only periodically came to the office.

Why someone needs 20 signatures to quit is ridiculous.

The only explanation is TIC -- this is China.