Of course, Wanda may realise an opportunity to expand, increase profits and gain recognition from capital markets in the process. For example, China has more than 1.3 billion people, but measured by American standards, revenue from China’s sports industry may be less than US$30 billion. The United States’ sports industry, or the global sport industry, is only about sports events, sports economy and sports communication, instead of the manufacture of sportswear and equipment. In contrast, America’s sports industry attains a revenue of more than US$500 billion and it has only 300 million people.

China’s per capita income is only 60 per cent to 70 per cent of America’s. As an emerging sector, China’s sports industry has tremendous room for growth. At the start of the year, China’s State Council formulated a plan that expects its sports industry to reach a net worth of 500 billion yuan (HK$610 billion) by 2025, which will come up to around US$1 trillion, or at least US$800 billion, if the yuan appreciates. It means there is ample room to grow in China.

So Wanda not only bought the companies you mentioned, but will conduct a series of acquisitions in sports. Our goal is to make sure that the businesses of acquired companies can touch down in the Chinese market and promote the development of this kind of sports industry.

You mentioned you’re moving into cultural industries. What are some of the special challenges Wanda is facing by going global?

Chinese companies face many challenges when they go global. They have only just started to go abroad. Although there are around 100 Chinese businesses on the Fortune Global 500 List, which is pretty similar with the US, real transnational companies are rare. Basically, most of them are state-owned monopolies. China can only become truly prosperous once it deploys a number of top international companies and dominates international resources and markets.

Of the challenges Chinese companies face when they go global, and also something that we faced, firstly there will be a lot of contradictions when you deal with local laws, corporate culture and management.

The most difficult part was our first step to acquire [US cinema chain] AMC in 2012. At that time, our company was relatively large and had some experience in management. We had negotiated the deal for more than two years, and had prepared enough managerial personnel and technology. We succeeded in this first step.

Regarding Wanda’s globalisation, or rather the globalisation of Chinese companies, it’s an inevitability. If Chinese companies don’t go through the globalisation phase, it’s hard for us to make China powerful or realise the Chinese Dream.

Why is the track record so mixed for companies going abroad?

The biggest problem in globalisation is to deal with the original management – how to retain the original management and let them work hard. There must be original management when you acquire a company. How to mobilise the initiative of original management is the biggest problem. If you buy a company, but all the original management leave, you’ve probably already failed. All the companies Wanda have acquired have one thing in common, which is that Wanda didn’t assign anyone to the company, including AMC. By designing a reasonable and effective incentive system, you can make management work hard for you.

Take AMC for example. We designed a good incentive system, which allowed them to make a loss in the first two years and make gains in the last three years. As a result, AMC made a profit in their first year once we came on board. And management’s income has increased 20 per cent to 30 per cent for three consecutive years, which is hard to do in the US.

So the most important thing in globalisation is to keep the original team. When an American company acquires a Chinese company, they usually send in a team of Americans, and this is destined to fail.

The New York Times reported on April 28 last year that the reason behind Wanda’s rapid growth lies in the company’s political ties. The report states that relatives of President Xi Jinping and other leaders are Wanda shareholders. Can you confirm this?

Wanda has no political affiliation. Let me talk about the truth of this matter. In January 2000, our commercial properties subsidiary had initiated a round of private placement and appointed China Galaxy Securities and CICC, China’s largest at the time, to oversee its execution.

We were fortunate, as market reception was overwhelming, even as we set a relatively high price at 13 yuan per share. We successfully raised 4 billion yuan (HK$4.6 billion), breaking the record for the most capital raised by a Chinese private company at the time. The investment company of Xi’s brother-in law, Deng Jiagui, Qinchuan Dadi, participated in the private placement at the same subscribed price level as other investment companies, such as the investment company of CCB International and China Oceanwide.

Just two months before the listing, Deng sold all the shares held by his investment company and fully exited at a low price point, and I’d like to state at this point that Deng was never a shareholder of our listed company. After six years of investment, he sacrificed the opportunity to realise a huge return in investment. I think he did so under pressure or influence. This incident demonstrates that Xi is not only strict in managing our country, but is even more scrupulous when it comes to family affairs.

We’ve seen a lot of capital outflow out of China recently. Are you increasing overseas investment because you want to diversify assets overseas?

Firstly, the actual reason for overseas investment is asset transfer, or rather to add assets overseas. That’s the result. However, there are no right or wrong answers on asset transfer from overseas investment – just legal or illegal. For example, you had a meal today. How can you say that it’s right or wrong to have a meal? It’s wrong only if you use public money to have a meal. If you use your own money, that’s alright. It’s the same logic.

Secondly, private companies that go global to expand their business are answering the call from government. At the end of last year, China’s State Council specifically released specifications to guide private companies going global. It can be said that Wanda answered that call.

Thirdly, Wanda didn’t steal, rob, or print money. It is fully earned by ourselves. I can invest anywhere I want to. That investment freedom, or rather freedom of capital movement, is a basic measurement of a country’s legal system. If a company doesn’t have full investment autonomy, there is no freedom in that society.

What are your views on the macro-environmental challenges facing the Chinese economy today?

The biggest pressure facing China’s macroeconomy is the pressure exerted by economic transformation. We used to have a saying in China, the “three engines of growth” – investment, exports and consumption. Two of those engines are currently running on empty – investment has slowed and exports are declining.

Although consumption has taken up some of the slack, we can see from last year’s numbers that China’s consumption accounted for 51 per cent of gross domestic product. This is particularly surprising. But as consumption grew by 1 per cent to 2 per cent, investment and exports shrank by 3 per cent to 4 per cent and the economy lost its pace. So from the outside looking in, perhaps from a European or American perspective, you might think China’s economy is crashing, but actually this couldn’t be further from the truth.

This is the necessary pain of economic transformation, and it takes 10 years. I think it can be shortened to six or seven years, so I think we can get it to five years at most, before we can emerge from the pain. When consumption accounts for two thirds of China’s GDP, I think our problems will be resolved.

Do you think the Chinese government will use your experiences to inspire a policy for other Chinese companies to venture abroad?

If Wanda could be so important to Chinese government and be used by the government in some way, I would feel very happy. When I came to purchase AMC, there were newspapers saying I was [acting] on behalf of China and the money came from my country. It is understandable as people may not understand when Chinese companies go global. In the future, if China has one or two hundred outstanding cross-border globalised companies around the world, then there will no longer be these kinds of opinions or scepticism.

State-owned corporations may represent the will of the state, though in fact a lot of them are market-driven in China. As a privately owned corporation, we basically have to base [what we do] on our own judgment: the first objective is to make money.

When you want to buy something, you know good stuff comes with good price. If you want better things, you pay more. Overall, when you’ve purchased a good company with a high price, you need to make a good profit out of it through excellent management. It depends on all of us … I am the founder and largest shareholder of the Dalian Wanda Group, and also the final decision-maker.

Following your purchase of AMC, how do you see the future of the film industry?

It’s difficult to answer. I am chairman of Wanda and AMC is just another subsidiary. The decision of how it’s going to be developed should come from the senior management, and that is the chief executive of Wanda Cultural Industry Group. I need to manage and formulate corporate strategies. I trust our professional managers working within Wanda that they can manage very well.

What’s your next business goal?

I’m still on my way to get where I want to be. I mean it. The way I defined success for myself is to lead Wanda to become a world-renowned company or being in the top 10. That’s my dream.

Now, Wanda might have gained some awareness globally, but it’s still far from being a real international brand. I hope that, in the future, when people are talking about Wanda, it could like they are talking about Microsoft, Apple, or Wal-Mart nowadays. To build a top brand as a leading Chinese enterprise, it’s my dream. Speaking of when I could achieve it, maybe in four or years at the fastest pace, or seven to eight years at a slower pace. I will retire by then.

My other dream is to help with poverty relief in China and to really make a difference. I’ve taken care of a prefecture in Guizhou province to conduct an experiment and promised 3 million residents in the prefecture that their per capita income would double within five years. We don’t simply give away money, but have done two years of research.

We’ve tried to build it up through two main methods. Firstly to establish a vocational college as residents who have the diploma from vocational colleges will be able to find jobs. Secondly is to help the area develop its distinctive industry – tea. We will expand the tea planting and processing system, along with branding strategies, to make a fortune for everyone there.

What do you think will happen to the US trading policy with regard to Sino-US relations if Hillary Clinton wins the US presidential election and what could that mean for China, or your corporation?

Unlike Americans, Chinese focus on their own affairs. America has a problem of involving itself in matters of other countries. The election is of no relevance to me. I believe that no matter who wins the election, the president of the US won’t do anything bad to China-US relations as the economic connection between our two countries is just getting stronger and stronger. For example, at a company like Wanda, we’ve hired 20,000 staff in the US as we are developing here. Imagine that one day, if there are 100 Chinese companies offering 20 million jobs in the United States, why couldn’t China and US embrace in a great relationship? It doesn’t matter who wins the presidency as long as it’s good for both our countries.

What are Wanda’s core competitive strengths for overseas development and how does it address the problem of not being very familiar with overseas markets?

Wanda’s core competiveness comes first from having money. As the economy develops, the cash flow runs stronger and stronger, so that we need to buy more assets. The second is that in Wanda, I am the largest shareholder and the final decision-maker and want to drive the company with long-term strategy and help our company achieve its value through efficient management. The third one is my management skills, gained through a few decades in developing the corporation, in knowing how to check costs and profits daily and weekly by informatisation and a remote-communication system, not just to get the total figures at the end of a year.

How do you want to be remembered?

The most important thing I want is that Wang Jianlin won’t be hated by anyone, not be remembered. There might be cultural difference between US and China; in China it’s difficult to make people really like you and remember you for a long time. Right now, China is still in the transformation phase, where some people could act flightily: they want to make a fortune, but sometimes they may hate wealthy people. I do hope that people can picture a philanthropist in their minds, not an entrepreneur, when I am retired or really old.

As you expand the Wanda hotel portfolio, both domestically in China and abroad, how do you see the customer base changing?

For domestic hotels in China, Chinese customers certainly are our targets, while international customers are our focus for hotels aboard. The objective of establishing Wanda hotels is not to offer places for Chinese tourists going aboard, but to build up a real high-end Chinese hotel brand.

China is in a period of economic transformation, so what opportunities will there be for the Chinese who return after studying abroad?

The greatest opportunities in China lie in its service industry – not the traditional service industry, but a modern service industry. Personally, I think there are three particularly promising industries. The first is in entertainment. You can see China’s economy is now growing at 6 per cent to 7 per cent, but for the past six years the entertainment industry has been growing by more than 40 per cent, and this year it has topped 50 per cent. There are certainly broad prospects for the future of the entertainment industry in China.

The second industry is sports. I mentioned previously that the sports industry in China is currently realising an annual income of US$20-30 billion, and that’s not even factoring in its potential if we grow to the same scale as the US. There is room to grow several dozen times over. This is especially so if we look to contemporary China, where we pursue health and longevity. So the sports industry in China has a bright future, absolutely. If you can study marketing, economics or media in the field of sports, this will be very useful as current talent in those areas is scarce.

The third industry is tourism, particularly in the integration of online-to-offline models, or “O2O”. This integrated tourism industry innovates by combining the travel destination with offline and online channels.

Within the next 10 years, these three industries will experience a significant growth in income. Enter those industries no matter what you [specialise] in – there is much money to be made there.

How do you think the recent change to China’s one-child policy will affect the real estate market?

It’s good, but a bit late.

In the US, or perhaps throughout the Western world, there is a perception that Chinese products and services are inferior. How would you tackle the problem?

Wanda cannot do it alone. Many Chinese companies need to work together to achieve this. This is the first step. Have America’s products always been so good? I heard a story today that in the 1970s and 80s Japanese cars entered the US market and Americans couldn’t sell their cars fast enough to get their hands on a Japanese model.

Nowadays you have American entrepreneurs who come out and wonder why they aren’t patriotic, and so on. American cars back then must have been big, bulky gas-guzzlers, and Japanese cars were better.

So under the impact of Japanese cars, American cars changed gears and clawed themselves back into the market.

Thirty years ago this would have been a pipedream. Quality and services in China are a little lacking right now, but they are in the inevitable stages of development. Don’t worry, I believe that we can solve this problem.

Source: Dalian Wanda Group