China’s Development Path
This piece below is to be seen as an outcome of a major review of the steps announced by President Xi to the Party Congress in 2017 that solidified the Socialist China line that would define the direction of China through 2049 and beyond. This line was initially outlined by Deng Xiaoping when Reform and Opening Up was announced, but its genealogy can be trace back to Shanghai in 1962 with a speech by premier Zhou, and to about 1956.
But this Socialist path of Economic development in the vanguard was pushed back by the Cultural Revolution. During the period from 1985 to 2002, it was never clear to amateur foreign watchers like me, if China was headed to a new form of Capitalism or a new form of Socialism. 2012 laid it down clearly. President Xi arrived with a full endorsement from China’s elders that the future of China lay in the sharing and caring traditions of China, but would use the forces of capitalism for its strengths in areas such as innovation. China’s Capitalism would be a Managed Capitalism and that was not what some in the USA and other Western countries wanted to hear.
Actually the direction of China is better for the West than a drift towards Western Capitalism. Why? This is not confrontational with the West and gives the West a lot of growth opportunities with a predictable strong state. China still has those who prefer no party and a free run of the private sector. But it is not going to happen, however much President Trump tries to push China.
China is going to have the soe’s at the centre of their development and regulatory structures to ensure the private sector is contained within the national plans. We can see that from the many changes in the leaderships of key private sector companies. We can see that in emerging candidates for key state leader roles.
See the piece below from Xinhua. What do I note apart from the clear commitment to Chinese Socialism including Managed Capitalism with Chinese Characteristics. Well the reference again to megacities – earlier the word used is metropolises. One is the Greater Bay Area, another the Yangzte Delta, another surrounding Beijing and Tianjin, another including Chonqing, Chengdu and Xian, and another, perhaps the Shandong peninsula and one or two in the North East.
The other note I take is of the positioning of the reference to BRI – the New Silk Roads – which will open up over 50-100 years into a new urban area of over 500 million people I would guess. Then with the middle East, Africa and South America linking in. BRI is very much at the heart of China but very much independent of China as an expression of shared nations and then we have the recent piece about the redesign of the West of China.
These two pieces are the base line for China 2035.
Here is the piece
China unveils guideline to accelerate improving socialist market economy in new era
Source: Xinhua| 2020-05-18 23:53:53|Editor: huaxia
BEIJING, May 18 (Xinhua) — China on Monday issued a guideline to accelerate the improvement of its socialist market economy in the new era to build a high-level socialist market economy that is more systematic, mature and well-shaped.
China will uphold and improve the basic socialist economic system of keeping public ownership as the mainstay and allowing multiple forms of ownership to develop together, the guideline said.
The guideline stressed minimizing the government’s direct allocation of market resources and direct intervention in microeconomic activities.
China will unswervingly expand opening-up, draw on the experience of other mature market economy systems and achievements of other civilizations, and accelerate efforts to align domestic systems and rules with international ones, it said.
The country will improve the market, policies, rule of law and social environment for supporting the development of private businesses and foreign-invested enterprises, it said.
Equal treatment should be given to firms of various types of ownership in obtaining production factors, access permission, operation, government procurement and bidding, the guideline said.
Meanwhile, detailed rules and specific measures should be improved to facilitate non-public sectors to enter fields of electricity, oil and gas, while market access in the service sector should be substantially relaxed, it said.
Efforts should be made to fully improve the property rights system, accelerate the establishment of a punitive compensation system in intellectual property rights infringement and strengthen the protection of business secrets, the guideline said.
The country will fully implement the negative list system of market access and fair competition review system, it said.
China will further stimulate creativity and market vitality of society as a whole, with measures including deepening the reform of the household registration system and loosening restrictions on settling in cities except for certain megacities, it said.
Other measures include improving the mechanism whereby prices are mainly determined by the market and minimizing improper government intervention in price formation.
The guideline stressed building a more open mechanism for international talent exchange and cooperation.
It also urged a long-term mechanism to crack down on fake and inferior commodities.
The guideline vowed to promote innovation in government management and service methods and improve the macroeconomic governance system.
China will accelerate the establishment of a modern fiscal and taxation system, it said.
More should be done to uphold and improve the system for ensuring people’s wellbeing and promote social equity and justice, the guideline said.
In terms of opening-up, China will build a new pattern of opening-up, with the focus on the construction of the Belt and Road, and accelerate the development of pilot free trade zones and free trade ports, it said.
The guideline stressed expanding imports of goods and services on a large scale, reducing the overall tariff level and eliminating non-tariff trade barriers.
Restrictions on foreign investment outside the negative list will be lifted completely, it said.
China will actively participate in the reform of the global economic governance system, the guideline said.
The country will improve the legal system for the socialist market economy and strengthen the rule of law, it said.
The guideline stressed efforts to uphold and strengthen the Party’s overall leadership to ensure the effective implementation of the reform measures.