Chapter 395: A Deal with the British Government
"What's done is done, but from now on, these matters will be managed by the financial company," Yang Wendong said, shaking his head. "However, if it's a strategic partnership relevant to your division, the financial company will only handle the capital side of things. It won't interfere with operations.
Meaning, if you have your eye on a company and don't want to handle the acquisition directly, you can pass it to the financial company to jointly negotiate the deal. Once successful, the shares will be held under the financial company. But business dealings between your division and that company will continue as usual—the financial company will not get involved."
As Changxing Group continued to grow, it had gradually acquired shares in a number of companies at home and abroad. Yang Wendong was now thinking about how to consolidate these scattered holdings—like stakes in several future supermarket giants, or some promising Hong Kong companies.
In Hong Kong, many businesses had gone public in recent years. But the looming 1967 economic crisis would not just hit real estate. The stock market and the broader financial sector would also present golden opportunities—especially with British-funded enterprises. Maybe the '60s weren't the best time to confront them head-on, but quietly buying up their shares now meant they could be bled dry later when the timing was right.
Wei Zetao nodded. "Got it. It's just like our real estate operations. Our subsidiaries focus on their own sectors and don't touch the financial side."
"Exactly." Yang Wendong smiled. "That was one of my primary considerations."
As a transmigrator, he wouldn't miss out on any high-potential industries—especially real estate and finance. But each sector needed to remain focused on its core competencies. He couldn't let them all become real estate speculators just because property was profitable.
That's why early on, he made a clear rule: no matter what a subsidiary's core business was, if they needed to acquire land, they had to go through Changxing Real Estate. Even for factory sites or office locations—if they had long-term development value—they would eventually be handed over to Changxing Real Estate for planning and execution. It was all to prevent subsidiaries from getting greedy and jumping into speculative real estate themselves.
The same principle now applied to finance. A few years ago, this wasn't a pressing issue. But as the Hong Kong stock market gained momentum—and especially from 1968 to 1973, when it would surge more than tenfold—the profits would far outstrip those of manufacturing or real estate.
Yang Wendong had no intention of letting this golden goose fly away. He would establish a dedicated company to handle it, while strictly barring other subsidiaries from participating—akin to imposing legal restrictions.
Wei Zetao asked, "So does that include this deal with Formosa Plastics?"
"Well, the financial company hasn't been formed yet, and this one's already underway, so it'll go under Changxing Industrial," Yang Wendong replied with a smile. "It doesn't really make a difference. I actually asked Wang Yongqing about this before. He told me he has no plans to go public anytime soon—apparently, quite a few Western capitalists are already watching Formosa Plastics closely."
"Westerners are eyeing Formosa Plastics?" Wei Zetao asked in surprise.
Yang Wendong nodded. "Yes. Western financial capital has long tried to control high-potential companies across the globe—especially those dealing in essential raw materials.
Our group hasn't caught their attention yet, but at the rate we're growing, it's only a matter of time."
All capitalists operate on the same logic. Finance often becomes the final frontier, because unlike manufacturing, it doesn't require sweating over operations—you just need to invest in capable entrepreneurs.
And when it came to sectors he didn't fully understand, Yang Wendong followed the same approach. Even with professional managers, he knew he couldn't personally oversee dozens of industries. If he could handle ten, that would already be impressive. For everything else, investment was the best route.
The same held true for global giants like Walmart or Auchan. Penetrating the Western retail market himself was nearly impossible. Investing, on the other hand, was simple and effective.
Overseas capital worked under the same logic. They didn't have a time-traveling cheat, so instead, they cast a wide net and waited to catch something big.
Investing in a company like Formosa Plastics—one that provided essential industrial materials—was practically a guaranteed win, as long as the company had the capability to grow. Plastic was rapidly becoming one of the foundational materials of the global economy.
That's why Formosa Plastics had already attracted foreign interest. Changxing Industrial, on the other hand, was still under the radar for now. Its strength lay in end products, and not essential goods—yet. But as its scale grew, the attention would come.
Wei Zetao nodded. "I've heard about this too—especially Wall Street investors. They're always trying to buy into promising businesses around the world. Though to be fair, they do have the ability to help some of these companies succeed, so it's not entirely one-sided."
"But the moment you take their money, it's like putting your neck in their hands," Yang Wendong replied with a smile. "Wang Yongqing is smart. He understands that only by becoming large enough can he avoid being controlled. That's why he's trying to grow fast using my capital.
And since I'm Chinese, if anything goes wrong, it's easier to resolve. I'm guessing that's his calculation."
"True. Mr. Yang's reputation in both Hong Kong and Taiwan is very solid. No one expects you to play dirty," Wei Zetao added.
"I wouldn't do that even if I could. If I believe in the petrochemical sector, I'll build my own facilities, not take someone else's," Yang Wendong said. "Forget all that—we'll just focus on doing our own work well.
What Wang Yongqing is worried about today, I may face myself tomorrow. That's why we have to grow stronger as soon as possible."
Business can never truly be separated from politics. In the U.S., if a Chinese-owned company grew too large, it would eventually be devoured by one of the four big families—leaving nothing behind.
If Yang Wendong wanted to copy the old route of Hong Kong's Four Great Families and just play around in this small pond, it would be fine. But his products were already being sold around the world, and soon he'd be moving into the electronics sector. That kind of exposure meant someone would come knocking.
And there would be no business solution to that. Only background could help. In the 1960s, the only real backing came from the British Commonwealth. After all, it had once been the greatest empire in history. Even in decline, it was still one of the five permanent members of the UN Security Council and retained some influence. Many former colonies still held it in high regard.
Even the U.S. had to tread carefully around the UK. Officially, the two remained close allies.
"Alright, I'll send a team to Taiwan immediately to finalize everything," Wei Zetao said.
Yang Wendong then turned to Yao Jingyi. "Start recruiting people for the financial company—preferably highly educated Chinese professionals from Commonwealth countries."
"Yes, Mr. Yang," Yao Jingyi responded.
In truth, the capital increase for Formosa Plastics was a relatively small matter. Once the company went public, they'd still have a chance to buy in. Acting now just meant saving a bit of money.
More importantly, the partnership with Wang Yongqing—and the resources he brought—could help build a petrochemical industry chain near Hong Kong. That would make it easier for Changxing Group to enter the sector. Even if the project failed, at the very least, it would reduce costs for Changxing Industrial's plastic products.
This development was also of immense strategic value to Changxing Group. Several products under Changxing Industrial were already facing fierce global competition. When technical differences were minimal, cost control became the single most critical factor.
On March 16, Yang Wendong received an invitation from the new Governor of Hong Kong, David Trench, and once again visited Government House.
"Governor, good day," Yang Wendong greeted with a smile and a handshake.
David Trench returned the handshake and said, "Mr. Yang, welcome. Please, have a seat."
After a brief round of pleasantries, David Trench got straight to the point. "Mr. Yang, I have some good news for you. The Justice of the Peace title that former Governor Sir Robert Black applied for on your behalf last year has been approved by the British side. Her Majesty the Queen deeply appreciates your efforts in helping Hong Kong with its water crisis last year."
"Please extend my gratitude to Her Majesty," Yang Wendong replied with a polite smile.
The queen during this era, of course, was none other than Elizabeth II, the same monarch who reigned into the 21st century. She had ascended the throne in the 1950s and became the longest-reigning monarch in British history. Her son waited a lifetime to inherit the crown, only to assume it in old age—and was later diagnosed with cancer, unlikely to reign for long.
David Trench continued, "The appointment as Justice of the Peace will be officially announced in July or August. That's already been decided, so there's no need to worry.
"But the reason I asked you here today isn't just about that. There's a second matter."
"Oh? What is it?" Yang Wendong asked, already guessing there had to be more than just the honorary title. Otherwise, the Governor wouldn't have needed to summon him in person.
David Trench replied, "It's from London. Officials there hope your company will consider investing in the United Kingdom—particularly, setting up a manufacturing plant."
"You want me to invest in the UK?" Yang Wendong was taken aback. "Governor, usually it's wealthier countries shifting factories to poorer countries, not the other way around. Wouldn't this be backward?"
"Haha, I know what you mean," David Trench chuckled. "But it really depends on the situation. Manufacturing hasn't completely vanished in the UK or the US.
You know, I previously served as the Commissioner for Industry and had deep involvement in Hong Kong's industrial policy, so I do understand these things.
Take some of Changxing Industrial's products—if moved to Europe or the US for production, they wouldn't necessarily lose money. Some items are simply too bulky or light for long-distance shipping. For example, wheeled suitcases. They're large, hollow plastic objects, and even if you own your own shipping fleet, the transport cost is still massive.
These kinds of goods are far better manufactured locally in the UK. That way, whether you're selling to Europe or North America, you benefit. Mr. Yang, you're an expert in this—you must understand the logic."
"That's certainly true," Yang Wendong admitted. "We've actually done internal calculations. In theory, producing in some parts of Europe or North America could be cheaper.
"But theory isn't everything. Overseas investments come with a host of uncontrollable issues—and risks we can't predict. Personally, I'd rather stick with Hong Kong or nearby regions for now."
He wasn't wrong. In his past life, many Asian factories had invested in the US, only to end up losing everything. Things might be slightly better in this era, but there was no need to take unnecessary risks—especially when the shipping container revolution was just around the corner, about to slash transport costs dramatically. Investing in the UK now would be premature—unless, of course, there were enticing benefits in exchange.
David Trench nodded. "Mr. Yang, your concerns are completely valid. But since you acknowledge the cost dynamics are similar, I'd suggest considering it seriously. If your company aims to become a global player, dealing with international challenges is inevitable.
You can't keep making money from overseas without putting something back. Trade is, by nature, reciprocal. You sell—others buy. But if you're always the seller, well… as a businessman, I'm sure you understand the implications."
"So if I invest in the UK," Yang Wendong asked, "does that mean the British government would have my back in global trade negotiations?"
David Trench smiled. "Exactly. First of all, within the Commonwealth, there would be no issue. But beyond that—say, in markets like the US or Asia—the British government could also step in when appropriate."
"All that, just for one factory? Doesn't seem like a worthwhile trade for the UK government," Yang Wendong said, genuinely puzzled.
Despite Britain's decline, this level of accommodation seemed a bit much.
David Trench explained, "Let me be honest with you. The real issue is politics. There's intense competition between UK political parties, and the core battlefront is employment. I'm sure you understand how crucial that is.
Right now, London is preparing to build a container port. But once it's completed, tens of thousands of workers—mostly young people—will lose their jobs. The political blowback is enormous. So the government is trying to attract manufacturing investment to offset that, reduce unemployment, and ease the political pressure."
"So that's what this is really about," Yang Wendong said thoughtfully. "But I'm just one man. I can't absorb that many workers."
The advent of container ports in the 1950s and beyond was one of the most transformative changes in global logistics. Get it right, and a port—or even an entire country—could thrive. Get it wrong, and a city like London, once among the world's greatest ports, could be destroyed.
Smart people could see this coming. But the workers on the ground didn't care about long-term trends—they only cared about their current jobs. Just like Kodak or Nokia in his previous life. Everyone knew transformation was necessary, but internal interest groups would never agree to reforms that came at the cost of their own livelihoods.
Successful reformers weren't just visionaries. Everyone could see the trend coming. The key was building alliances, appeasing opponents, or crushing resistance to reshape the balance of power. That was what made true revolutionaries.
David Trench nodded. "The British government isn't asking you alone to shoulder this. If you were the only one they were speaking to, they wouldn't have sent me. If you're interested, London will dispatch a dedicated delegation to Hong Kong to negotiate with you.
As for how much to invest and what benefits they'll offer in return, you can work that out directly with them. I won't interfere."
"Alright. I'm open to discussions," Yang Wendong said, finally giving a measured nod.
Even if nothing came of it, it was better to maintain a cooperative tone. A flat-out rejection would only breed ill will. Of course, he knew the British and their promises could be flaky at best.
"Good, I'll inform London immediately," David Trench said, smiling.
Suddenly, Yang Wendong raised another question. "Governor, if the UK is developing container ports, what about Hong Kong?"
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