Editor’s Note: From sustained high-speed growth to GDP and the scale of import and export trade climbing to the second and first in the world respectively, China has achieved a miracle unprecedented in human economic history in the 40 years of reform and opening up. This is recognized by the world. But many people ignore another "miracle" — — There has been no economic crisis in China for 40 years. The impact of the subprime mortgage crisis in the United States more than a decade ago has not stopped. The Asian financial crisis more than 20 years ago plunged many "stars of hope", but China rose steadily in this environment and made important contributions to the world economy and related countries to get rid of difficulties. As a developing economy, how did China do it? What is the "China experience" behind the "miracle"?
The crisis in the outside world continues, and China’s development is "higher, farther and faster"
Repeated miscalculations, western experts become "brick experts"
"In the past 40 years, the average annual growth rate in China has been close to 10%, setting a historical record; It is the first developing country to become a big country. So, why do you think it can’t always exceed people’s expectations? " Last year, Huang Yuchuan, a well-known American economist, wrote in the The New York Times: "The moderns of China economy may be over, but in the next decade, even the growth rate of 6% is amazing … … China has never been an ordinary economy. "
For the development of China in the past 40 years, the outside world cannot but marvel. However, there have always been many arguments against China. For example, the "China’s economic collapse theory" appears every once in a while, and not only the western media, but also some well-known European and American experts advocate it. There is also the "China Financial Crisis Theory" — — Some "professional organizations" said that China’s rapidly increasing debt ratio and real estate bubble will inevitably lead to financial crisis. During the Asian and global financial crisis, this kind of voice was especially frequent. But what happened?
From 1979 to 2017, China’s economy grew at an average annual rate of 9.5%. In 2008, despite severe setbacks in major western economies, China maintained steady growth and became the second largest economy in the world in 2010. Last year, German Times Weekly summed up the "China Miracle" with such a title — — China: Higher, farther and faster. According to the article, as of December 2016, 695 million people in China accessed the Internet through smartphones; By the end of March 2018, China had 3.14 trillion US dollars in foreign exchange reserves; 115 China enterprises have entered the world’s top 500 … …
In the past 40 years, China is one of the few countries that has never experienced an economic crisis, and it is the only emerging economy that has never experienced a systemic financial and economic crisis. Take Russia as an example. In 2014, due to its heavy dependence on commodity exports, the Russian economy felt a violent shock. In 1998, the financial crisis almost paralyzed its economic operation. Last year, Russia’s GDP ranked only 12th in the world.
According to statistics, in 1960, there were 101 middle-income economies in the world. By 2008, only 13 of them had entered the high-income ranks, among which five were Japan and the "Four Little Dragons of Asia" (the rest were European countries and oil-producing countries). However, the financial crisis in 1997 plunged Japan into a long "de-bubble" era, and the "little dragons" and "little tigers" in East Asia and Southeast Asia were also hit hard. The scene of Koreans donating gold and foreign currency spontaneously shocked the world, and the intensity of their sadness can be seen.
Argentina and Brazil are no exception. Last year, Argentina turned to the International Monetary Fund (IMF) because its currency plummeted, which evoked many people’s memories of its economic collapse in 2001. Argentina has a long history of economic instability, which is an "unsolved mystery" in economics, and is still a high-risk economy at present. In 2013, Brazil fell into the worst economic crisis in a century and became a "knocked-down giant", and now it is also the Argentine he is my brother.
"It is indeed a miracle that China has developed at a high speed for 40 years without an economic crisis. For 40 years, no big country has been able to do this. " Florian Lupe, a Berlin scholar on China, said in an interview with the Global Times that the same is true in western developed countries. From the financial crisis to the European debt crisis, Europe has been in a "crisis" for the last 10 years.
China has a unique advantage in preventing crises.
The "Great Economic Wall" was created in this way.
Economic crisis usually refers to the phenomenon that after human beings enter the commodity society, because the balance between production and consumption is broken, there is a surplus of large-scale production relative to the effective demand of workers, which leads to the collapse of the economic system. According to Marx’s exposition, the root of the crisis is the basic contradiction of capitalist economy, that is, the contradiction between the sociality of production and the capitalist private ownership of means of production.
Three successive large-scale economic crises before the First World War led to the intensification of contradictions among European powers. The economic crisis from 1929 to 1933 swept the world and was the most destructive one so far. After World War II, with the upgrading of industries, the periodicity of economic crisis was not obvious. The economic crisis caused by the oil crisis in 1973 was once called "the last economic crisis". But in the "post-industrial era", the "financial crisis cycle" quietly emerged. In 1987, the "Black Monday" in the United States was just a "wake-up call". Latin American financial crisis, Asian financial crisis and American subprime mortgage crisis … … With the United States provoking and escalating the trade war, people have begun to worry that a new round of crisis will come quietly.
After the founding of New China 70 years ago, it was isolated from the external economic circle for various reasons and was not obviously affected by the global crises before the 1980s. Since the reform and opening up, especially after China’s accession to the World Trade Organization (WTO) in 2001, China has encountered many twists and turns, but most of them are "endogenous" and detached from the global crisis. Like the Asian financial crisis 22 years ago, China was recognized as "not affected much". Later, the "subprime mortgage storm" hit China only at the beginning of the crisis.
China is "exceptional" for many reasons. In the 1980s and 1990s, many countries believed in the "Washington Consensus", implemented "shock therapy", and cancelled all government intervention in the market, resulting in economic collapse and stagnation. And China has not completely let the "invisible hand" of the market go. On the other hand, China’s regional development is unbalanced, which is caused by the long-term economic lag before the reform and opening up, but it gives China more room for economic buffer, thus making it difficult for the "crisis cycle principle" to play a significant role.
German scholar Lu Pei believes that this is no accident. China has suffered many disasters in the last 200 years, so it has drawn lessons from the history at home and abroad. China is politically stable, with strong internal cohesion and external influence under control. In particular, effective measures at the government level have created an "economic Great Wall" to prevent crises. "China’s economic system has unique advantages, such as concentrating superior forces to do big things." Juck Zhang, a scholar at China Renmin University, told the Global Times reporter.
Germany’s "Focus" magazine recently said that many western scholars have to admit that Beijing has more means to stabilize the economy than the West. An article by official website of the Australian National University sums up: China leaders are pragmatic and not limited by ideology; China, while experimenting, "crossed the river by feeling the stones", which is in sharp contrast with some Eastern European countries … …
From the highly anticipated "The White Knights" to the first engine of the world economy
"China’s Contribution" in World Economic Development
When communicating with Latin American scholars, especially experts from Brazil and Argentina, Global Times reporters found that China’s economic success they mentioned most often lies in two aspects: first, it has established a relatively complete and developed industrial system; The second is to ensure the stability of the currency.
In the second half of the last century, many Latin American countries implemented the "import substitution" policy, that is, restricted the import of manufactured goods from Europe and the United States to protect their own industries and tried to build a local industrial system. However, to this day, almost no country in Latin America has realized the dream of that year. This also leads to the Latin American economy being affected once the international political situation or market fluctuates. Therefore, when China has the confidence and atmosphere to introduce economic policies that attract international attention in the regional or global crisis, they are particularly envious.
As a responsible big country, China has not been "immune" while creating an economic miracle. When the Southeast Asian countries were almost wiped out by the Asian financial crisis, Japan, the largest economy in Asia at that time, devalued the yen sharply, which made the Southeast Asian countries worse. China promised that the RMB would not depreciate, and firmly stated that the process of financial and state-owned enterprise reform in China would continue.
Ten years later, another bigger financial storm broke out, followed by the European debt crisis, and China quickly became the "The White Knights" in the eyes of the West — — Can China save the world? At that time, American and European countries’ efforts to rescue the market were like "throwing a stone into the river only stirred up some small waves", and a rumor that China might launch a new economic stimulus plan could drive the global stock market to soar together. China didn’t let the world down. In The New York Times’s words, "Beijing acted quickly (launched a huge stimulus plan), and its growth was a rare bright spot in the global economy". China’s efforts have also made the long-established but "non-existent" concept of the G20 truly "fall to the ground" and become one of the main mechanisms to deal with the financial crisis.
China’s contribution goes far beyond this, and it has lifted hundreds of millions of Chinese out of poverty and created the largest middle class in the world. According to the report released by the National Bureau of Statistics of China on August 29th, since 2006, China’s contribution rate to world economic growth has been ranked first in the world, with 27.5% in 2018, 24.4 percentage points higher than that in 1978.
Yao Jingyuan, former chief economist of the National Bureau of Statistics:
The secret of China’s 40-year success
40 years without economic crisis, what kind of development track has China gone through? What is the most important experience? The Global Times reporter interviewed Yao Jingyuan, a special researcher of the State Council Counselor’s Office and former chief economist of the National Bureau of Statistics.
Yao Jingyuan said that in the past 40 years, China has undergone a transition from a planned economy to a market economy. Since the Third Plenary Session of the Eleventh Central Committee, the focus of the Party’s work has shifted to economic construction and the implementation of the reform and opening-up policy has been continuously promoted. "China’s economy has achieved many world firsts in 40 years, and what is more prominent is that China has built a perfect industrial system. According to United Nations standards, China has 41 major categories, 191 middle categories and 525 sub-categories. Now the country with a complete industrial system of large, medium and small categories in the world is China. "
Regarding the difficulties encountered in this process and the experience of connecting with the world, Yao Jingyuan said that in 1998, the whole of Asia was greatly impacted, and China, as a responsible big country, shouldered the heavy burden of maintaining the world financial order. In the process of fighting external risks, China’s economy has gradually deepened its reform and further strengthened its ability to resist risks. When the world financial crisis occurred in 2008, China’s economy was highly correlated with the outside world, and the degree of economic extroversion was as high as 70% at one time. China’s economy was severely impacted by the outside world, and the State Council, the CPC Central Committee, adhered to the basic line of the basic policy of reform and opening up.
"These two external shocks have proved for the first time that China has strong economic resilience and high stability, and let us persist in exploring the road of building Socialism with Chinese characteristics; Second, we have a deeper understanding of China’s entry into WTO. Practice has proved that China’s integration into the world is of great significance to China’s economic growth. " Yao Jingyuan said that China has been constantly pushing for and deepening reforms in its opening up, such as the reform of state-owned enterprises and financial reform, which have been rapidly promoted after its accession to the WTO.
Therefore, Yao Jingyuan concluded that the fundamental reason why China’s economy can maintain the track of high-speed and medium-high-speed development and successfully resist external shocks is, firstly, unswervingly adhering to the line of reform and opening up, and secondly, constantly exploring the road of building Socialism with Chinese characteristics. "We are not simply imitating the path taken by some western countries, we are looking for the path of Socialism with Chinese characteristics. These 40 years are the 40 years that China has been exploring the road of building Socialism with Chinese characteristics under the leadership of the Communist Party. "