Beijing--With its subdued wood paneling, the bronze ashtra bearing the seal of the U.S. Senate and the big TV monitor flickering with on-line headlines from around the world, there is little to distinguish Rong Yiren's spacious office from that of any other chairman of the board of a multinational corporation.
But then there is the centerpiece of his office's decor: A large color photograph of Mr. Rong shooting the breeze with his ultimate boss, China's paramount leader, Deng Xiaoping.
Nimbly balancing such contradictions is old hat for Mr. Rong, the 74-year-old head of the sprawling conglomerate known as the China International Trust and Investment Corp. (CITIC), which for the last dozen years has been communist China's premier player in the world of international capitalism.
"I am a former capitalist who believes that socialism can work here," Mr. Rong says with an at-peace demeanor belied only by his constantly fidgeting hands.
The scion of wealthy Shanghai industrialists and still one of the richest men in China, Mr. Rong did not flee with much of the rest of his family following the 1949 communist revolution, patriotically opting instead to apply his financial expertise to the cause of rebuilding China in a socialist mold.
Two decades later, during China's disastrous Cultural Revolution, this decision earned him menial jobs in which he is said to have suffered intense humiliation.
But, with China's reopening to the rest of the world in 1979 under Mr. Deng's new economic reforms, Mr. Rong was resurrected and given instructions from Mr. Deng himself to be "boldy creative" in forming CITIC to lure foreign capital and technology into China.
Since then, Mr. Rong has rapidly built CITIC from scratch into a widely diversified, worldwide holding company with assets of more than $5 billion; more than 20,000 employees around the globe; investments in more than 300 projects, a quarter of them outside mainland China; and, despite increased competition from other Chinese companies, an enduring reputation as the most Westernized, competent and flexible business group in China.
Blessed with a direct tie to China's State Council along with an unusual degree of freedom, CITIC was the first communist Chinese company to set up projects in China with foreign capital and the first to enter into joint ventures with foreign partners. It also was the first Chinese organization to float bonds overseas.
And it came to be the first stop for large Western investors looking for the right connections and clout in China's heavily politicized, often cloudy business environment.
CITIC owns glitzy hotels and dozens of heavy industrial plants in China, major shares of the phone company and two airlines in Hong Kong, and all or major shares of an aluminum plant in Australia, a pulp mill in British Columbia, a timber company in Washington state and a steel mill in Wilmington, Del.
It has its own banks in China and Hong Kong; makes Peugeot autos in the southern provincial capital of Canton and Otis elevators in the northern port of Tianjin; peddles military weapons internationally; dabbles in Arizona real estate and California venture-capital deals; and leases Cadillacs, Mr. Rong's favorite car, in Beijing.
And in the process, CITIC has served as something of a mirror for the larger Chinese economy, in which out-of-control growth for the first decade of economic reforms forced an abrupt, painful retrenchment that began in late 1988 and that was compounded by the debacle of the June 1989 slayings of pro- democracy protesters near Beijing's Tiananmen Square.
The central government's continuing effort to get a grip on China's overheated economy -- via strict lending and import controls, corruption and nepotism investigations, and increasingly stiff regulations -- sunk or severely constricted the operations of many of CITIC's high-flying followers, smaller regional foreign investment and trading companies often called "baby CITICs."
CITIC has suffered as well. Western businessmen here, who typically will talk about their dealings with the company only anonymously, say that CITIC has had a much hardertime raising capital domestically during this economic downturn. After the Tiananmen crackdown, its Moody's bond rating was dropped a notch, though that ranking still compares favorably with those of some of the largest U.S. banks.
Whereas CITIC once would trade in almost any commodity that promised a profit, it now has been forced to noticeably pull in its reins, the Western business sources say. On the investment side, it has shifted from high-profile hotels and real estate endeavors to less clamorous energy and natural resource projects more in line with China's newly restated national development priorities.
A state investigation into irregular foreign exchange dealings brought CITIC a fine of more than $5 million. Other problems remain, judging from a recent scandal involving the head of CITIC's bank branch in the Shenzhen Special Economic Zone near Hong Kong.
CITIC's profit growth, spectacular until 1988, has been much smaller since then. As exemplified by Occidental Petroleum's recent decision to withdraw from the huge open-pit coal mine called Antaibao, some of CITIC's most prominent ventures with foreign partners in China are floundering.
And lately, the company has appeared less interested in its original purpose of attracting foreign capital to China -- it claims to have brought in more than $500 million since its inception -- than in its own overseas investments, reflective perhaps of CITIC's own hard-nosed analysis of the wisdom of investing within China right now.
"There is no question that CITIC is operating in a different environment these days, that they've had their wings clipped somewhat," says a longtime American businessman here. "It used to be that they were involved in anything that would make money. Now they've retracted their tentacles."
Mr. Rong, however, says that statement represents a "superficial" view of CITIC's new situation.
"CITIC has brought about some great developments," he says, "but I should also admit we had some non-ideal things take place. Now we have more of a framework to follow. Things have become more regulatory. We have some restrictions for our further development, but it is not true that we are confined."
Most foreign analysts, indeed, agree that CITIC has survived China's recent economic woes better than most other Chinese companies.
"CITIC still is China's premier front man," says Robert Broadfoot, managing director of the Political and Economic Risk Consultancy in Hong Kong. "They may not be flying as high as they were a few years ago, but they have only been reduced in line with other Chinese companies. Nothing has risen to change their relative position."
Adds an international trade consultant here: "They are no longer God, but they still shake the biggest stick."
Evidence of CITIC retaining its special, wide-ranging portfolio lies in its continued buying spree in Hong Kong under the direction of Mr. Rong's son, Larry Yung -- purchases that have left China with key stakes in the British colony's infrastructure before China's planned 1997 takeover of Hong Kong.
To provide just a short list, CITIC has acquired 25 percent of Hong Kong's biggest company, Hongkong Telecommunications; a third of Asia's first commercial satellite, AsiaSat-1; a quarter of Hong Kong's new cross-harbor tunnel; 12.5 percent of Cathay Pacific airline; and 38 percent of another Hong Kong-based airline, Dragonair.
Such investments serve to blur distinctions between CITIC as a financial entity and CITIC as a instrument of Chinese national policy.
For example, a February visit to Australia by Mr. Rong to discuss increasing China's investments there was almost immediately followed by an Australian government announcement that it would resume normal relations with China, which were suspended following the Tiananmen slaughter.
For Mr. Rong -- one of a slew of vice chairmen of China's rubber-stamp legislature, head of the All-China Federation of Industry and Commerce and the most senior non-Communist official in China -- such intermingling of business and politics seems inescapable, particularly given the capitalist path he has paved for communist China.
"When we first engaged in international business," he recalls, wheezing slightly from his chronic asthma, "some people called me a 'landlord,' and you know what that word means in the Chinese context."
Despite a lingering vulnerability to this sort of political attack here, Mr. Rong was not shy about letting it be known that he was initially sympathetic to many of the concerns of the 1989 pro-democracy protesters in Beijing, even allowing CITIC employees to contribute money and join in the movement.
He was rumored to have been so unhappy with the military crackdown on the protests that, when he took a long vacation in Canada last summer, CITIC had to issue a statement denying that he had defected.
These days, Mr. Rong cuts off any discussion of his sentiments regarding the brutal outcome of the Tiananmen protests, except to essentially parrot the party's line by saying the events showed that China's "students need to be educated about actual conditions" in their own land.
But if the future of his capitalist-style service to China's ruling Communists was in doubt, that apparently is no longer the case.
Mr. Rong was the subject last winter of a rumor of a completely opposite stripe: that he would assume a new vice premiership especially created for a non-Communist. Though this has not yet come to pass, it nonetheless underscores the likely continuation of Mr. Rong's unique balancing act here.