Foreign investors are growing increasingly cautious about setting up joint ventures in China, but most pitfalls can be avoided by adopting a prudent strategy, says the American head of a Beijing-based investment firm. Jack Perkowski, chairman and chief executive of Asian Strategic Investments Corp (Asimco), yesterday detailed recommendations for making investments in China a success. Asimco is one of the largest foreign investors in the mainland, having ploughed US$350 million into 17 joint ventures in businesses ranging from car components to beer manufacturing. Mr Perkowski said: 'People ask me what is our biggest problem in China. I say 'Nothing - It's a different problem every day.'' Mr Perkowski said the most important recommendation he could give businesses looking to set up joint ventures in China was to obtain management control, as the mainland still suffered from a dearth of experienced managers. Maintaining control included taking the majority ownership of the venture, writing a management contract, controlling marketing, or convincing the other partners of knowing more than they did about the business. Choosing the right partner was also a matter for care. Mr Perkowski said it was important to pay attention to the structure of the potential partner as many government-owned firms proved too inflexible to cope with market changes. He said joint ventures with state-owned enterprises often ended up being hamstrung. Joint ventures with entrepreneurial partners such as individuals, or village enterprises, were far more flexible. Mr Perkowski said one should also understand the potential partner's agenda. The attitude of many Chinese partners remained a problem as 50 years of isolation had left many with little understanding of the global marketplace. He said the lack of business infrastructure made self-sufficiency important, and wholesaling and retailing distribution networks in China tended to be chaotic. The financial system was undeveloped and did not effectively channel savings into investments.