Al WBF 2006 Chris Patten spoke of the economic growth of China. Let’s look into the matter.
The growth of China between fear and sustainability. China’s re-emergence as a global economic (and increasingly political) power raises a number of important questions, the answers to which have implications for all of us.
It is sometimes easy to forget that China’s rise has brought some huge benefits – and not just to the millions of Chinese who have been lifted out of poverty in recent years. Oil and commodity producers have seen demand soar and Asian countries have seen an explosion in trade with their neighbour. There have been benefits for consumers in the US and Europe, and China’s vast use of its foreign exchange resources to buy up American debt has kept interest rates lower for home owners.
It is easy to see why there are those that feel threatened by China’s rapid growth. But where there China is undercutting and outperforming in the market place the answer shouldn’t be protectionism , but better education and training, more labour flexibility and lower government taxes on industry. Raising the standard of living of more than a fifth of humanity should be something to be celebrated. Threats may be seen to come in another form – to the impact on the global environment for example or the ability of the world to deal effectively with states such as Burma or Sudan, and with Iranian nuclear ambitions.
The sustainability of China’s growth is another factor open to question. For China, economic sustainability means social stability, something Chinese leaders are very keen to maintain. But questions over intellectual property theft and counterfeiting of goods, human rights abuses, corruption and a lack of checks and balances in the political and corporate sectors give the west reasons to justify economic nationalism.
The inexorable rise of China has been portrayed as inevitably leading to a struggle between it and the US. For now China seems happy to be taking its place once again as an important player on the world stage. Although China owes its emergence as a global power to the free market system pioneered by the US it has very different values from those in most countries that have grown up under the influence of western-style democracy. The more it adopts those values, the more the west is likely to applaud and make way for its continued extraordinary progress.
These and other issues surrounding China and its growing influence will be addressed at this year’s World Business Forum in Milano by Chris Patten, someone with unique insights as last British Governor of Hong Kong charged with negotiating the handover of the island back to China from British rule.