China Has Learnt Global Lessons Well
Country moving from old drivers of growth to sources of innovation and services
Stephen Roach
Stephen Roach is a senior fellow at Yale University’s Jackson Institute of Global Affairs and a senior lecturer at Yale’s School of Management. He was formerly chairman of Morgan Stanley Asia and the firm’s chief economist. For his 30-year career at Morgan Stanley, he headed up a highly regarded team of economists around the world. He has long been one of Wall Street’s most influential economists.(https://www.daowen.com)
In looking back on its extraordinary accomplishments since 1978, China has much to be proud of in celebrating 40-year milestone on the road to economic development. But as President Xi Jinping implied at the opening of the 19th CPC National Congress in October, 2017, this milestone should be viewed as more of an intermediate stop on a long journey rather than a final destination. In essence, it is a pivotal transition point between the economic take off of a poor nation and the sustained growth of a moderately well-off society that aspires to great power status by 2050.
In keeping with this sense of transition, for the first time in 36 years, the Party has revised the all-important “principal contradiction” facing Chinese society — from the backward social production of a poor nation as stated in 1981 to inadequate and unbalanced economic development as restated in October 2017.This underscores a very different focus for China’s basic strategy over the next several decades — moving away from old drivers of manufacturing-led growth and uncovering new sources of innovation- and services-led growth.
But with this shift in strategy also comes an equally daunting reassessment of how China’s shifting trajectory fits into the broader world — both from an economic as well as from a geostrategic perspective. Long dependent on external demand as the sustenance for economic growth and development during the early stages of its take-off, China is now playing an increasingly important role in driving and shaping the rest of the world.Fitting the “Next China” into a world that is facing its own set of very daunting problems — ranging from climate change and environmental degradation to mounting inequalities and trade tensions — promises to present China with enormous challenges in the years to come.