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What is China’s development model? (2)

By Curtis Stone (People's Daily Online)    16:42, March 21, 2019

The second characteristic is to have a proactive government. As a civilizational state, Professor Zhang said, China has a completely different historical heritage. In the long history of China as a unified state, which stretches back over 2,000 years, China, in most cases, has had a unified ruling entity. Leading a country like China, the ruling entity has no choice but to represent the overall interests of the people rather than the interests of some people, as is the case in the West.

If you look at the world, and especially the developing countries in the world, the biggest problem that a developing country which adopts the Western model faces is the “soft state” problem, he said, a term that was introduced by Nobel laureate in economics, Gunnar Myrdal. What the term means is that the government’s executive power is very weak, because it has been kidnapped by various vested interests, and politicians are wandering endlessly. In the end, he pointed out, no consensus can be reached, and as a result, it becomes difficult to achieve modernization and people’s lives are not improved, let alone to the point where they overtake the Western countries.

China, on the other hand, with a proactive government in place, can claim that it has solved this problem. In the past few decades, China has completed the largest industrial revolution and social revolution in human history and has entered the information age in sync with the West. In fact, as Professor Zhang pointed out, China is even at the forefront in many fields.

The third characteristic is that stability is a top priority. China has a large population and limited resources per capita, which is a potential source of instability. In addition, China’s huge territory has regional cultural differences and national cultural differences that are far more complex than the average country. If things are handled improperly, it could very easily result in contradictions and even conflicts.

At the same time, the West has threatened China’s stability with hostile forces and separatist forces within and outside the country. These forces are always on the lookout for any display of independence and want to see China disintegrate like the former Soviet Union or the former Yugoslavia. However, Professor Zhang thinks this result is unlikely, because China has the strong leadership of the Communist Party of China and a long-standing “great unity” of the Chinese people. China has also been rapidly creating the world’s largest unified market. “Because of all this, the West’s attempts will fail,” he argued.

On the other hand, a civilizational state has its own remarkable cultural heritage. As long as political stability in China is maintained and an open-minded policy is implemented, the Chinese people will become rich through their own hard work and be well-fed and well-clothed. This is because Chinese have a tradition of thrift and hard work, he pointed out. In addition, he said, this same spirit follows them everywhere they go, even overseas. Thus, as long as there is a stable environment and open policies, the Chinese people will become rich.

Professor Zhang raised a point about Chinese culture, saying it connects “Tai Ping” (which literally means “peace”) and “Sheng Shi” (which literally means “prosperous society) together. According to this thinking, as long as the country is stable and developing, many problems will gradually be solved in the process of development.

The fourth characteristic is that improving people’s livelihood is a main goal. Professor Zhang said that Chinese history has thousands of years of folk-based traditions. He quoted an ancient maxim: “People are the foundation of the nation and peace requires a firm foundation.” In other words, the fate of the country depends on whether the problem of people’s livelihood is solved well. Therefore, making sure everyone has food to eat has always been a top priority for the Chinese government. In the early days of reform and opening-up, the country’s biggest pressure was how to solve this problem. Later, it was the “adequate food and clothing,” “well-off,” and “all-round well-off” goals. Today, it is the “two centenary” goals. Professor Zhang noted that this kind of people-oriented thinking is the backbone of China’s development and said that China’s evolving goals are the continuation and development of this kind of thinking.

Professor Zhang said that an important experience of China over the past 40 years, at least when viewed within an international context, is that the development of a country must be based on people’s livelihood, and core human rights - the elimination of poverty and improvement in people’s livelihood, must be promoted. Because poverty, especially extreme poverty, undermine human dignity and human rights.

Starting from such a concept, China has spared no effort to improve people’s livelihood and has achieved remarkable results in eliminating poverty. He pointed out that 740 million people have been lifted out of poverty, according to China’s own estimates, which rises to 850 million based on World Bank estimates. He said that there are still more than one billion people living in extreme poverty in the world and the Western model has been unable to solve this problem. He also said that a large amount of human, financial, and material resources have been used by politicians to engage in politics. He concluded his point by citing an African proverb: “When elephants fight, it is the grass that suffers,” adding that the people are not happy.

The fifth characteristic is gradual reform. Professor Zhang thinks this is especially important for a country like China with a large population, a vast territory, and complicated conditions. This is the biggest challenge, he said, because decision makers lack sufficient information. This is why the Chinese central government generally tries to build upon the initiative of various local groups and encourages various experiments. If a test is successful, it is promoted. He also said that some Chinese traditional wisdom, such as “crossing the river by feeling the stones” and “haste makes waste,” are actually reflected in the nation’s reforms.

With regard to gradual reform, Professor Zhang said that in this case it refers to the macro strategy, which is different than saying that the speed of reform must be slow. For example, he said, China’s opening to the outside world began with the establishment of four special economic zones along the coast. This happened gradually in the context of the whole nation. The establishment of the four special economic zones was an experiment of China’s large scale reform and part of the gradualism from the macro-perspective. But from the micro-level, construction of these four special zones started right after the central government made the decision, which is a reflection of the speed and efficiency of the Chinese model.

The sixth characteristic is the mixed economy. Professor Zhang described China’s current economic system as a “socialist market economy,” which, he said, is essentially a mixed economy. He described it as a mixture of “visible hands” and “invisible hands,” or a mix of market forces and government power, with a role for the state-owned economy and a role for the private economy. On the whole, China has established a socialist market economy, which is an economy that not only maximizes the efficiency of the market in allocating resources, but also ensures the strengths of macro-control measures.

In China’s 40 years of reform and opening-up, private enterprises have also developed rapidly. At the time of his talk, the private economy was responsible for more than 50% of the tax revenue of the country, more than 60% of GDP, more than 70% of technological innovations, more than 80% of urban labor employment, and more than 90% of enterprises. “I remember ‘Singles’ Day’ in 2016. I was talking about the Chinese model at Oxford University in the UK. I took out a mobile phone and talked to them about ‘Singles’ Day,’” he said, emphasizing that Alibaba’s online transaction volume during the 2016 shopping spree reached 120.7 billion yuan, exceeding the entire year of e-commerce volume in India. “This is China’s great success,” he said, adding that the Singles’ Day online shopping festival is an example of China’s mixed economy. While Alibaba is a private enterprise, behind its success is the construction of infrastructure, such as highways, high-speed rail systems, and telecommunication networks, which are mainly invested by state-owned enterprises.

The seventh characteristic is opening to the outside world. In the past 40 years, China’s all-round opening-up strategy has proven to be very distinctive. From the coast to the rivers to the borders and later to the entire mainland, China’s opening-up has formed a pattern of all-round opening-up, covering every corner of the nation, Professor Zhang pointed out.

Most importantly, he said, is that in the process of opening-up, China has, on the whole, drawn on the experience of other countries and is not blindly following the Western approach. Behind this is the self-confidence of the Chinese people, he stressed, which stems from the historical inheritance of China. As long as Chinese civilization is open to the outside world, it will rejuvenate and innovate. He stressed that this was true in history and is true today and will be tomorrow too.

Opening to the outside world has also enabled China to better understand the real situation of the outside world. Professor Zhang pointed out that many Chinese love their motherland even more when they travel abroad to see the outside world by themselves. It has enabled China to establish and be confident in the path, theory, system, and culture of socialism with Chinese characteristics. “China’s own wisdom can really make a lot of contributions to the world,” he said.


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