English is becoming more widely spoken in China, but Mandarin remains the principal language. However, even Mandarin is not universal, with an estimated 400 million Chinese unable to speak it and millions more far from fluent. Such barriers to understanding, plus pronounced cultural variation between different parts of China, can make it difficult to establish a foreign business. Because of this, many businesses choose to enter the Chinese marketplace by means of joint ventures with local entities. There are several forms of joint venture open to foreign businesses, of which the most popular is the Wholly Foreign-Owned Enterprise. However, there are restrictions on the types of business that these can undertake, and foreign businesses still have to navigate complex and opaque Chinese regulations and deal with several government agencies. Working with a partner that has expertise in Chinese culture, politics and regulation can be invaluable.
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