Dan's China diary - day 21

In May 2006, silicon.com senior reporter Dan Ilett travelled to China, seeking to get behind some of today's most interesting tech and business stories. This is his warts-and-all diary, which appears daily this month. For in-depth coverage of this fact-finding trip inside China, including analysis and exclusive stories, click here.

Friday 26 May, Hong Kong

Last day in Hong Kong. Flying home tonight. Can't wait. I'm shattered but I've a bit of time to kill so take a trip around the island.

Looking out of the bus window, Hong Kong feels so different to the mainland. People don't stare when they see a foreigner - it's no big deal to them. Fewer people spit in the street and there are nowhere near as many bicycles. But you still know you're in China.

Yet while Hong Kong has been interesting, I had a much bigger culture shock on the mainland.

As someone who has spent just three weeks in China I feel I need more time to see life here. I've only had a snapshot of the business world in China, which leaves the majority of the land undiscovered for me.

But if I had to give a round-up of what I've seen, I'd say that I'm amazed how fast the country is changing - the development of land, infrastructure, economy, education and society. It's moving at an incredible pace - at least on the surface, in the big cities where businesses are showcased the most to foreigners like me.

But there's also a massive sense of pride in a long history that some people are not so willing to give up for the promise of a strong economy.

Tim Clissold's book Mr China was one of the most insightful reads for me. He tried to deal with factory owners and make large investments in government-owned companies here. It seemed like a real struggle.

As a journalist, my experience is different. I've heard people's stories. One common refrain: "You need to be careful doing business in China. It's not only competitive but cut-throat and there are fewer regulations to protect your interests. A lot of success comes from relationship building - pick the wrong partner and you could have a multitude of problems."

One entrepreneur told me: "The way Chinese business works is if you can have $50 now or $100 in the long-term, people here will go for the $50 every time. Perhaps you can pull something out of that - China has not long been a developing country. And before that life was certainly uncertain for many."

Another said: "China has only had business laws in place for 20 years. The US has had 70 years to develop regulations to close loopholes to stop fraud. China has to catch up quickly."

With ecommerce, I've heard scores of people talk about the lack of take up. This is still a society largely based around cash - only 10 per cent of people have credit cards. And there is still some debate as to how developed credit checking agencies are.

Now put this against the background of the fact there are 1.3 billion people here - only 110 million of whom use the internet, yet 400 million have mobile phones. Technology is playing a massive part in the development of the economy but not always in the most obvious ways.

There are also more pressing issues than mobile phones and computers for the majority of people in China. While luxuries like these are helping the country to grow its economy, people in regions I have not visited find it hard enough to find money to buy food and clothes. More than 200 million people live off less than a dollar a day.

Some people I spoke to in Beijing, for example, have families in the provinces where life is still like that.

But these are other people's stories - not mine. I'll have to make my way to these areas next time I visit China. But by then, it'll probably be completely different.