Mr. Michel, the One Allianz in China Initiative was recently launched under your leadership. What’s the story behind it?
Uwe Michel: We want to showcase ourselves to the Chinese public as a company that can offer the entire gamut of financial services. We have ten units in China, from Euler Hermes to Allianz Global Assistance and Pimco. None of the foreign competitors can boast such a broad product range and we need to make this clearer in the public’s mind. Until now the units have operated largely independently of each other. The aim of the initiative is to generate more profitable business and the key to that is better cooperation and concerted action in our dealings with clients. We want Allianz in China to become synonymous with financial solidity – just as Mercedes stands for solidity in automobile manufacturing.
Western companies complain about difficult market access. What obstacles does Allianz have to overcome in China?
Tough competition for one. The former state insurers are still the dominant force in the market. Regulatory restrictions are also a problem. Foreign suppliers have a 4.8 percent share in the life insurance market and just a 1.2 percent slice of the property and casualty segment. The supervisory authorities don’t let foreign insurers near the really rich pickings, although the Communist Party has now promised a measure of liberalization.
Not for the first time.
I’m not going to be naïve about it, nor will I rule out the possibility. Chinese insurance companies have become so strong that they won’t have to tighten their belts even without the protective hand of the state. In an emerging country like China you need a healthy dose of optimism, otherwise there’d be no point in entering the market at all. And you need to be in it for the long haul. The time horizons in China are different to what we’re perhaps used to.
Does One Allianz in China mean that Munich is picking up the reins?
Not at all. One Allianz in China is an initiative of the ten Allianz units in China. We see it as our job to bring them closer together. They should be seen in the marketplace as a single Allianz. But the reins will remain in the hands if the local Group companies. They know the market, their clients and their needs. What we’re providing is support. China works from the top down. That’s why our executives and experts should visit more often. In the future we need to clarify what we have to offer the Chinese and expand our role as a knowledge provider in order to enhance our brand image.
What does that mean specifically?
We’re going to send our experts to China to give presentations, meet with decision-makers and get the media on board. Recently, for instance, our chief economist, Michael Heise, traveled to China to hold a lecture on the future of the euro and the European Union. This was well received in the press. We don’t want to spend more money on marketing – that would be ineffective in such a big country with so many megacities – but we do want to put our know-how to better use, for instance in the fields of demography and infrastructure projects.