From debris field to economic powerhouse
- By Helmut Matt
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A freight train carrying 123 new Volvo cars made in China arrives in Belgian port of Zeebrugge on June 30, 2017, marking a milestone in the history of cargo transport between the two countries. |
"The Chinese people have arisen" – with these words Chairman Mao Zedong declared on October 1, 1949 not only the victory of the revolution, but also the founding of the People's Republic of China (PRC). This historic date marked the birth of New China.
During the century or more leading up to that day the erstwhile flourishing ancient China suffered invasion, war, and civil war too. These disastrous events brought unimaginable hardship and devastation to the country.
During that time, China was one of the world's poorest countries, and suffered constantly from famine and exploitation. The average life expectancy of China's citizens was then 35, a figure that underlines the extent of their suffering during this period of Chinese history.
When the PRC was founded, the Communist Party of China (CPC) and the People's Liberation Army – the only two national organizations that remained intact – faced a mountain of obstacles. The country lay in ruins, transportation and traffic were at a standstill, agriculture had been more or less destroyed, and the irrigation system had been irreparably damaged due to the blasting of many river dams during the war.
But this suffering was not confined to the countryside. Owing to speculation and corrupt administration, the food supply lines in many cities were broken, leaving people literally starving to death on the streets.
Shortly after their victory in the Chinese People's War of Resistance Against Japanese Aggression, the Communists switched their focus to the most urgent task of removing wreckage and remodeling society to match their aims. It was in this way that they laid the basis for the new, modern China that we know today.
Although, mostly due to lack of experience, mistakes were made and misadventures occurred, especially during the first years after the revolution, the CPC nevertheless successfully stabilized the foundations of the young nation, and made the people's advocacy of sovereignty an irreversible national principle.
However, no one at that time could possibly have foreseen the success story which China's economic and social development would tell.
Although soon after liberation the country still struggled with a series of difficulties and setbacks, the measures that Deng Xiaoping took in 1978 marked a crucial turning point. The success of the new reform measures and the policy of opening-up, although at first carried out cautiously, were clear from the outset.
Before long the resultant revitalization of the economy was clearly apparent. In the space of just a few years an inexorable dynamic had set in which made China a leading country among the world's most important economic powers.
The 19th CPC National Congress
The 19th National Congress of the CPC will take place on October 18, 2017. A communiqué, issued after the Sixth Plenary Session of the 18th CPC Central Committee in October last year, states that the 19th Party congress constitutes a crucial event in the political life of the Party and the State.
The CPC is China's guiding force, and also key to the country's success. With around 90 million members, the CPC is the world's biggest political party today. One of the CPC's essential characteristics is its strong anchorage in the hearts of all Chinese people. Its members emanating from all social strata and regions of the country, the CPC is a people's party in the most literal sense.
Currently, China once again stands on the threshold of a qualitatively new phase of its development, in both economic and social respects.
Although the CPC has focused mainly on growth and volume since the beginning of reform and opening-up, the Party remains aware of the different frameworks that have arisen in the post-industrial era.
As the country with the world's biggest population, China's development has now reached a level on whose grounds the old economic paradigms have reached their limits in many respects: Air quality has reached a critical, health-endangering level in some places, and many big cities suffer traffic gridlocks. The apparent blessing of development has thus become a hazard in many places.
It now becomes ever clearer how closely the people's living standards and life quality are connected to political and economic trend-setting decisions.
The CPC has meanwhile set ambitious goals for itself as regards the country's modernization and further development, but has maintained a clear focus, regardless of its complicated starting point.
Despite its great importance to the international community and the world market, China is still a developing country, although in the economic sense China has set its sights on becoming the world No. 1.
"Moderate prosperity for everyone" is the goal the CPC has formulated. As regards prosperity, China is still a country of huge differences, whether in regard to the disparities between urban and rural regions or between the highly developed eastern coastal regions and those in the west, whose development still lags behind.
The Chinese government, with President Xi Jinping at its core, is working hard towards leveling out regional disparities and strongly promoting development in the weaker regions of the country, strengthening them through new investment.
In 2021 the CPC will celebrate its 100th anniversary. By then, according to its plan, the country will have mainly overcome poverty.
An important precondition to reaching this goal is ensuring that China's economy continues to grow, and that its relatively strong annual growth – which according to forecasts will account for 6.5 percent or more in the coming years – is maintained.
Robust growth is mandatory to the projected increase of GDP and of the Chinese people's per capita income by the year 2021. The Chinese government is currently initiating a range of steps and projects aimed at reaching this goal.
The government plans, for instance, to reduce surplus production capacities and to optimize the country's economic structure, so lifting it to a higher level. One important focus is also that on the fight against corruption.
Strengthening the Supply Side in the Economic Circuit
On the occasion of the 95th anniversary of the CPC, William Jones, an American international affairs expert and director of the Washington office of the American journal Executive Intelligence Review, said in an interview with Xinhua News Agency that, under the leadership of the CPC, China walks the path of sustainable development and has achieved great success in this respect.
This, according to Jones, is an achievement no other person or country in the history of humankind has so far been able to match. "I think that the CPC deserves great applause for the performance it achieved and also for the enormous changes it has brought China and the Chinese people," Jones said.
Jones went on to say that the CPC has systematically analyzed the changing circumstances since the end of the Cold War. He observed that, through clever strategic changes, it has managed to lead the country along the path of sustainable development.
Jones cited the Chinese government's startlingly future-oriented project of reviving trade along the ancient Silk Road.
Just how flexible and effective China's government can be under the leadership of the CPC is particularly clear in the field of economic control, wherein a change of direction recently took place.
Lingering weaknesses in the global economy have also driven the Chinese government's search for new solutions. In the past, China's economic policy mainly focused on international trade and exports. It has now switched to domestic turnover and consumption.
These quantitative improvements are flanked by innovative and qualitative measures, among others, in fields like environmental protection and renewable energies. The growing use of green and renewable energy and the promotion of new-energy vehicles will have direct influence on air quality and the cleanness of Chinese cities.
Direct effects on life quality and people's health can be expected as a consequence, especially in the country's cities and economic conurbations.
Green development is a precondition for sustainable development. Under the slogan "Beautiful China," the Chinese government has for the first time included environmental protection as an integral part of its comprehensive development concepts of innovation, coordination, green development, opening-up and mutual benefits.
Its industry, agriculture, resource usage, lifestyle and energy guidelines thus meet the needs of the Chinese people and their desire for a better, more enjoyable life.
Chinese President Xi Jinping formulated on November 10, 2015, at the 11th Meeting of the Central Leading Group for Financial and Economic Affairs the new term "supply-side structural reform" as a counterpart to the demand side.
Through supply-side reform, China seeks to respond to the falling demand for Chinese products overseas.
The intended reforms will be based on five fundamental guidelines: stabilization of the macro-policy, refining of the industrial policy, revitalization of the micro-policy, implementation of the reform policy, and the underpinning of social policy.
As China News Service reported, the intended reform entails the abolishment of "zombie enterprises," cutting surplus production capacities, driving the development direction towards emerging and innovative fields, and formulating new approaches to economic growth.
By means of innovation, phasing out outmoded means of production, reducing debt and surplus production capacities, and reducing the tax burden, the Chinese government plans to reflate the market, and release new productive forces while at the same time strengthening their competitiveness. The government moreover plans to continue its active financial policy as well as its current moderate monetary policy.
The overall goal is to optimize the structure of China's economy. China thus seeks to ensure that it maintains a robust economic growth of at least 6.5 percent, even in difficult times.
Belt and Road Initiative
Another project through which the CPC has responded to the challenges of a growingly complex world, and which has gained a great deal of international attention in recent years, is the Belt and Road Initiative.
This groundbreaking initiative was initiated by President Xi Jinping in 2013 during his visits to Central and South Asian countries. Xi's vision consists in infusing new life into the ancient Silk Road, which for centuries connected Asia and Europe.
He proposed in his speech to students and teachers at Nazarbajev University in Astana, Kazakhstan's capital, the "mutual development of a new economic belt along the Silk Road" to "deepen existing contacts and cooperation between European and Asian countries." The initiative, Xi said, aims to bring all participants better prospects for future development.
The eventual goal of the initiative is to build the world's longest economic corridor – from China, over Central and Western Asia to Central, Eastern, and Western Europe.
A freight train traveling the 10,000 or more kilometers connecting China with the German city of Duisburg, for instance, is only one aspect of the immense Silk Road project.
All these measures are aimed at promoting trust and mutual appreciation among participating countries, and strengthening the bonds between them.
So far, more than 70 countries and international organizations have actively participated in the Belt and Road Initiative. China has signed cooperation agreements with regard to production capacity with 20 countries, and built around 50 cooperation zones in countries along the new Silk Road.
President Xi pointed out in June 2016 at the Legislative Council of Tashkent in Uzbekistan that China has signed agreements on production capacity cooperation with 20 countries. He added that the country had established 46 foreign cooperation zones with 17 countries along the Silk Road.
Today, investments from Chinese companies amount to a total of US $14 billion in these regions. China's commitments have also created over 60,000 local jobs.
However, although China is the driving force behind the Belt and Road Initiative, the Chinese government sets great store on equal cooperation among all participants.
China aims at taking greater responsibility in a globalized and multipolar world and making even bigger contributions to the world economic system by virtue of its national economy while maintaining its opening-up policy.
The "Belt and Road" concept clearly aims at expanding China's on-going opening to the world at large and intensifying its cooperation with other countries on the basis of mutual benefit. The Belt and Road Initiative thus provides the world economy with important new stimuli.
The Belt and Road Initiative has inestimable potential, and not just in economic terms, but also in the fields of environmental protection, IT, and security. Concrete cooperation initiatives already exist between the countries of Asia and Europe. They are aimed, for instance, at the development of tourism and strengthening of academic and cultural exchanges.
While, on the one hand, gigantic new economic regions and markets are expected to drive economic growth and prosperity, deepened contacts on the cultural and interpersonal level will, on the other hand, promote security and mutual understanding among nations.
In the past several years the Chinese government has promoted in many ways stronger exchanges between cultures, and deepened mutual knowledge among peoples. In this way China makes a major contribution towards a more harmonious and peaceful world.
The Belt and Road Initiative should hence become not only an economic medium but also build a bridge between peoples of different countries and cultures.
Momentum and Stability for China and the World
In 2021, CPC will celebrate its 100th anniversary. As we have seen, despite its venerable age, the Party can hardly be bettered as regards its creative power, dynamism and inventiveness.
Under the CPC's leadership, the PRC has transformed from a poorhouse into a major economic power. After a century of foreign exploitation, the CPC has restored to China its unity, independence and dignity, and shown the whole world the potential of the country and its people.
At times of economic difficulty, China is a role model for stability and reliability, and a ray of hope for the global economy. The examples mentioned above demonstrate that the CPC will indeed succeed in further developing and stabilizing the country, and at the same time reach out to all countries and partners who are willing to participate in building a brighter future for the world on this basis.
Many decisions will be made at the 19th CPC National Congress that are of great importance to China's future development, and which the rest of the world will follow with great interest.
HELMUT MATT is a writer and sinologist based in Germany.
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