Speaking at the World Economic Forum in Davos, Switzerland, today, CEO Eric Schmidt said he really doesn’t want to shutter Google’s Chinese operations, he would just like the company to have more of a role in shaping its domestic policy.

“We like what China is doing in terms of growth…we just don’t like censorship,” Schmidt said. “We hope that will change and we can apply some pressure to make things better for the Chinese people.”

Asked later what it might take for Google (GOOG) to remain in China–aside from pull more Internet users than the total population of the United States–Schmidt replied, “We would very much like to stay in China. We would very much like the censorship we oppose to improve in China.”

Sadly, that doesn’t seem likely to happen anytime soon. Certainly, the public and confrontational manner in which Google has chosen to approach the issue has not gone over well with the Chinese government, which seems unlikely to capitulate. Meanwhile, Google rivals are making it known that they are perfectly willing to step in if and when the search sovereign leaves the country.

Consider this treatise on Sino-Redmondian relations from Microsoft (MSFT) CEO Steve Ballmer:

Engagement in China and around the world is very important to us, in part because we believe it accelerates access to 21st century technology and services and helps provide the widest possible range of ideas and information. We have done business in China for more than 20 years and we intend to stay engaged, which means our business must respect the laws of China. That’s true for every company doing business in countries around the world: we are all subject to local laws.
 
At the same time, Microsoft is opposed to restrictions on peaceful political expression, and we have conversations with governments to make our views known.  In every country in which we operate, including China, Microsoft requires proper legal authority before we remove any Internet content; and if we remove content, we give users notice.