Within 70 years, China grew out of abject poverty to become the world’s second-largest economy. “The China story” happened so quickly that the world is still struggling to figure out the factors behind its rapid rise and its impacts on other countries.
The United States, in particular, is so worried it will eventually be overtaken by China as the world’s superpower that it is scrambling to contain the Asian giant’s rise with a flurry of efforts, including imposing additional tariffs and trying to suffocate Chinese high-tech companies, leading to the disruption of the world’s economic order and new risks in geopolitics. Some other countries, such as Singapore, have become worried that they might be caught in the middle and forced to pick a side between China and the United States.
In a book titled “Can Asians Think?” first published in 1998, Singaporean academic and former diplomat Kishore Mahbubani said Asia’s economies were poised to surpass those of Europe and North America within the next 30 years, and yet Westerners had done little to adjust their attitudes in light of this reality. About 20 years after the book was published, Western countries have yet to appreciate the rise of a country with a different political system and recognize that Western ideas and systems are not always a superior fit for all countries.
Among Westerners, misunderstanding of China abounds. Joerg Wuttke, president of the European Union Chamber of Commerce in China, recently accused the Chinese Government of distorting competition by “pursuing SOE (State-owned enterprise) reform with Chinese characteristics,” which aims to make SOEs “stronger, better and bigger.”
While it is true that there is room for China to level the playing field for private and foreign-funded companies, it is ridiculous to attack China’s efforts in making SOEs stronger. Under socialism with Chinese characteristics, SOEs are the backbone of the economy, while the private sector is also an important part of the economy. Therefore it is impossible for China to weaken its SOEs. However, to ensure fair competition and hence healthy and efficient economic development, China needs to make greater efforts to eliminate unfair privileges enjoyed by any enterprise, be it an SOE, private firm or foreign company.
Viewing China from the perspective of Western economics only leads to wrong perceptions and harmful conclusions.
Back in 2009, some U.S. government officials and economists became laughing stocks for saying high savings in emerging markets such as China and oil exporting countries sowed the seeds for a global credit bubble, whose bursting led to the 2008 global financial crisis.
And now the U.S. is blaming China for its huge trade deficits without looking at its own problems: its domestic economic structural problem, low household savings and high fiscal deficits. In a word, Americans are spending more than they produce. The U.S. will import huge amounts of goods from other countries if not from China. “Foreign import barriers and exports subsidies are not the reason for the U.S. trade deficit. … The policies of foreign governments affect only how that deficit is divided among America’s trading partners,” Martin Feldstein, professor of economics at Harvard University, wrote in 2017.
China’s model of governance is also viewed with bias.
Peter Hennessy, a British historian and academic specializing in the history of government, authored the “good chap” theory of government. “The British constitution is a state of mind,” Hennessy says. “It requires a sense of restraint all round to make it work.” The Economist lamented that the “good chap” model is coming apart in the U.K. as the country is consumed by scuffles over Brexit.
China’s relentless fight against corruption, its people-centered policies and achievements in reducing poverty show that restraint and responsibility feature strongly in Chinese governance. Ironically, while the U.K. is facing threats to the “good chap” model, the U.S. is experiencing another sort of governance crisis – Donald Trump’s unhinged, racist, protectionist and selfish behavior is the opposite of restraint and responsibility, with the impeachment inquiry and Robert Mueller’s investigation revealing a president suspected of abusing his power and obstruction of justice.
It is no problem for the rest of the world if Americans and Britons believe their political systems are functioning well and they stick to these systems. But they should not regard China’s system as inferior or threatening. As a Chinese idiom says, “It is up to the wearer to decide whether the shoes fit his feet.”
China issued a white paper Friday seeking to help the international community better understand its development and reassure the rest of the world that its development poses no threats to other countries.
The report, titled “China and the World in the New Era,” says China’s all-round opening up has created more opportunities for all countries to share the benefits of China’s development.
The McKinsey Global Institute’s (MGI) says in a July report that its new China-World Exposure Index shows that the world’s relative exposure to China has increased, while China’s to the world has fallen – because of the trade tensions and the increase of domestic consumption in China.
However, such reduced exposure will be short-lived. Even as some in the U.S. are pushing to decouple the world’s largest and second-largest economies, China is striding ahead with reform and opening up. Despite the headwinds of unilateralism and protectionism, China is trying its best to enhance connectivity and build better relationship with the rest of the world.
As China celebrates its achievements over the past seven decades, it is also time for different civilizations to learn from each other.
(The author is head of the Shenzhen Daily News Desk.)