THE long-running political row over Hong Kong Governor Chris Patten's reform proposals has had no effect on the ability of British firms to cut deals in China, according to a Beijing-based consultancy. ''The only problem is that boardrooms in the UK panic. They don't understand the situation and assume it is a threat to them doing business here,'' said Peter Batey, director of Batey Burn and Co. British companies account for the bulk of the business handled by the investment, trade and political/economic research consultancy. Mr Batey said British companies lagged behind in China investment, despite initiatives such as trade visits organised by trade minister Richard Needham. Clients include such blue-chip names as Alfred Dunhill, British Telecom, Courtaulds, Estee Lauder, Guinness, Rothmans International and United Distillers. ''As consultants, we don't tend to get easy projects. A lot of the products we get are in sensitive areas, such as the tobacco industry, the alcoholic drinks industry and cosmetics,'' Mr Batey said. ''They are among the three toughest industries to crack, having high import tariffs and strict rules on access.'' The firm was set up in 1989 by Mr Batey and Richard Burn, both once political private secretaries to former British Prime Minister Sir Edward Heath. The firm is not shy about playing on the Heath connection. Its offices in the CITIC Building on Jianguomenwai Dajie are festooned with photographs of Sir Edward meeting China's leaders. ''The Heath name still opens a lot of doors in China,'' Mr Batey said. ''It would be easy to under-rate it, but it was under Sir Edward that Britain upgraded diplomatic relations to full ties in 1972, several years before the United States - even though [former US president, Richard] Nixon grabbed all the limelight with hisvisit that year - and the Chinese remember him for that.'' Mr Batey believes 50:50 joint ventures can make for the best of business partnerships in China as no side is under any illusions about the other. He said there were problems with the practice of many international companies in flying in large delegations of directors when negotiating deals in China. ''Foreigners need to give their Chinese interlocutors the chance to say things privately; they need to create the situation where they can have some informal meetings. ''Now is a good time to prepare for investment. Whether we have a soft or hard landing, the jury is still out, but, if you have the preparatory work done, the venture will be ready to come on stream just as the economy is nudging up again. ''People say the Chinese are slow, but I find that it is the foreign partner that I am kicking up the backside to get on with it.'' Batey Burn and Co is financial adviser to the Kleinwort Benson group. It recently set up a public relations consultancy, Batey Burn Statham (China), with Keith Statham Associates. The firm handled publicity for the listing in Hong Kong of Beijing Renmin Machinery. Sir Alan Donald, British Ambassador to China before Sir Robin MacLaren, is a non-executive director of the firm, as is Richard Graham, who was British Trade Commissioner, China, in Hong Kong until 1992. Ian Hay Davison, whose report following the 1987 stock market crash led to the overhaul of Hong Kong's securities markets, is an adviser.
