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Challenging the China model

Three decades after the start of Deng Xiaoping’s reforms, the nation has much to celebrate, writes Leo Horn. But what lessons can developing countries really take from China?

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[An earlier version of this article was published on July 28, 2008]

This week China reaches a historic milestone: the thirtieth anniversary of Deng Xiaoping’s economic reforms. And there is much to celebrate. Three decades ago China was isolated and struggling, with poverty rates on a par with Malawi. Today China has joined the “premier league”: China’s economy has grown nine-fold to become the fourth-largest economy in the world (a reasonable appreciation of the yuan would propel China in to second place, ahead of Japan). A staggering 200 million people have been lifted out of poverty in this time. China now holds US$1.75 trillion in its coffers, and has become the number one trading nation and destination of foreign direct investment.

Understandably, this achievement has been an inspiration to many around the world. Development experts and ideologues of all shades are touting the “China development model” as incontrovertible evidence in support of their disparate theories of development. And developing country leaders are turning to China in search of solutions to their own developmental quagmires.

From Venezuela to Vietnam, evidence of the appeal of the so-called “China model” abounds. Iran, Syria and other Middle Eastern countries invited China experts to lecture senior officials and academics. And former premier Zhu Rongji famously sent one of his chief aides to Cuba to lecture hundreds of Cuban leaders on social and economic reform, following a visit by Raúl Castro.

Obviously China has done something right. There is little doubt, for example, that the focus on export-oriented growth and gradual liberalisation of prices, combined with an outward-looking foreign investment regime were instrumental to high and sustained economic growth. A high savings rate, upfront investments in large-scale infrastructure development, rapid urbanisation and a good investment climate were also undoubtedly key elements of economic success.

But whether the sum of strategic policy decisions and non-decisions over the past three decades add up to a full-fledged model of development is questionable. The term “China model” implies at least three things: success, replicability and deliberate design. On all three counts there is room still for healthy debate. 

Qualified success

China’s achievements should be seen in perspective. Its economic performance over the past 30 years has actually been less impressive than that of its east Asian neighbours (such as Japan and South Korea) during comparable stages of growth. This is not surprising given the similarity of starting conditions and policies (for example, high initial levels of education, land reform, export-orientation, selective state support for key industrial sectors, high savings, disciplined and abundant workforces).

More importantly China’s ecological crisis, mounting social disparities and endemic corruption are critical counterpoints to its economic success. In all these areas the situation has worsened in tandem with economic reform, causing widespread discontent and threatening to jeopardise future growth. China remains very much a developing country. Per capita income is less than in Botswana or Angola, and two thirds of its population have no health insurance. China will face formidable challenges in the future: how it addresses these will be the real test of its success.

Uniqueness

It is questionable how much of China’s experience could or should be exported. “Economic freedom plus political repression” is an all-too-common short-hand description of the “China model”. The suggestion that this may constitute a blueprint for authoritarian regimes is misleading and dangerous. Relative cultural homogeneity and a value-system geared towards perpetuating order and upholding social harmony above promoting individual interests provided the underpinning for a social contract which gives primacy to economic over political freedoms.

Furthermore, China’s uniqueness in terms of size and history help explain its economic rise. China has enjoyed economic superpower status several times in the past. As recently as 1820 it accounted for 30% of global GDP. On a long enough time scale therefore, what we see is reversion to an earlier trend: China may merely be reclaiming its rightful place in the superpower league. China’s size also is a lure in itself: the massive latent pool of cheap labour and the promise of a market of one-billion-plus consumers make China an inherently attractive destination for international capital.

Learning by doing

Most importantly, the concept of a “China model” makes no room for what is arguably the most important ingredient in China’s economic success: serendipity. Rather than treading a pre-set path towards economic development, China was able to improvise along the way, learning from experimentation, and thereby responded flexibly and pragmatically to unintended outcomes and unforeseen events, in line with Deng’s encomium to “cross the river by feeling for stones.”

All major policy changes in China have been the result of a process of trial and error on a limited scale (usually a single sub-national jurisdiction). Successful experiments are then scaled up and rolled out across the country. Thus the establishment and success of four special economic zones in the 1980s was a crucial precursor to the raft of market-oriented reforms that followed. Likewise the bankruptcy law was first piloted in one province before being passed at the national level. The phased decontrol of prices through a dual pricing system – whereby some prices were set by the plan and others progressively set by the market – is another striking example of successful pragmatism.

Change was also instigated from the bottom-up. Almost all the developments in rural China have emerged as a result of local level innovation. When Fenyang county, in Anhui province, broke ranks with Party orthodoxy by dissolving the agricultural commune and allowing individual farmers to sell surplus produce on the market, a domino effect was to ensue that swept through the whole country. By 1983, 98% of peasant households were operating under this new “household responsibility system”, from zero just a few years earlier.

Likewise, the explosion in town and village enterprises (TVEs) in the 1980s took everyone by surprise, including Deng (by his own admission). By the 1990s the TVEs had become the backbone of the rural economy, providing employment (58% of all rural jobs in 1993), financing for local public goods, and also spurring the development of the rural credit system.

Certainly there are many worthwhile lessons to be drawn from China’s experience of economic reform over the past three decades. But China's approach may be more interesting than its actual policies.

Rather than adherence to an intellectually consistent and ideologically circumscribed model of economic development, reform in China was driven by pragmatism and a piecemeal approach to instigating and managing change. The wisdom of China’s reformers was to stand back and make room for experimentation and local initiative, to embrace and cleverly exploit the inescapable element of luck. If there is one lesson it is to be open and pragmatic about reform.

 

Leo Horn is national coordinator for the UK-China Sustainable Development Dialogue, and founding director of EnAct 21, a policy advisory consultancy dedicated to promoting sustainable development through diplomacy. He writes here in a personal capacity and his views do not necessarily reflect those of the UK government.

Homepage photo by Daniel Wayne Amstrong

 

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发表评论 Post a comment

评论通过管理员审核后翻译成中文或英文。 最大字符 1200。

Comments are translated into either Chinese or English after being moderated. Maximum characters 1200.

评论 comments

Default avatar
匿名 | Anonymous

借鉴意义

中国的发展模式对印度等发展中国家有重要的借鉴意义

Inspirational value

China's development model is inspiring to developing countries such as India.

(Comment translated by Yang bin)

Default avatar
匿名 | Anonymous

明确的物质驱动力

中国没有信仰、宗教上的忧虑,所以一直一心一意的发展经济,改革的物质驱动力很明确。这种性格使我们快速发展,但也带来未来的担忧。

Materialism as an explicit drive

As people in China have less concern about beliefs or religions, they can develop their economy with undivided attention, so the reform is driven mainly by profit. This character of Chinese people brought the rapid development as well as anxiety about the future.

Default avatar
匿名 | Anonymous

回2号评论明确的物质驱动力

你并没有意识到一件事情。一种宗教信仰的广泛传播本身其实是实用主义被贯彻的结果。即使在信仰者本身看来他们的信仰无比神圣,先于或高于自身,社会,人类甚至宇宙。不管是当政者的推动,还是知识分子的宣扬又或民众的自主选择,最终一种宗教信仰所带来的现实作用仍然是为社会服务。所以很明显的,当我们的社会需要某种精神上的信仰时,一种或多种信仰自然会在社会广泛传播开并影响社会的发展。我们所需要担心的事情其实是如何不让信仰在社会需要进步的时候阻碍进步。

response to comment No. 2

One thing you are not aware of is that the wide spread of a religion, actually, is also resulted from pragmatism being carried out. Even though in believers' eye, their beliefs are inviolable and more important than everything else,including themselves, society, mankind and even the universe. But whether it is driven by the authorities, promoted by intellectuals, or chosen by common people themselves, the practical role that religious beliefs play is still to serve the society. So it is very clear that one or more beliefs will spread naturally in and influence our society when the society needs a spiritual belief. What we need to worry about, indeed, is how to prevent the belief from blocking the social development when a society needs to go forward.

translated by Ming Li

Default avatar
匿名 | Anonymous

过去三十年的信仰

过去三十年的信仰是“发展是硬道理”,是经济建设为中心;在接下来的三十年,生态危机、社会矛盾渐渐凸显,也许过去的信仰会就是未来三十年的障碍,我们需要改变过去三十年的信仰。

Beliefs in the past 30 years

Our belief in the past 30 years is that "Development is the absolute principle", and we focus on economic development. But ecological crisis and many social conflicts are emerging in the following years. Our old beliefs may become a barrier in the future, so we need to make a change.

Default avatar
匿名 | Anonymous

赞同4号

“摸着石头过河”,对于中国领导人来讲,和谐社会的建设难度非同小可.

Agree with comment No.4

“Cross the river by feeling for stones.” To the Chinese leaders, building a harmonious society is an arduous task.

Default avatar
匿名 | Anonymous

继续努力

中国能在这么短的时间内发展到这种水平确实是很了不起,当然,也不可避免地出现了很多问题。要想继续保持稳定的发展,必须改变发展模式。

Keep it up

It is marvelous for China to have developed to such a high level in such a short time. Of course, unavoidably, we have many problems. We must change the development model if we want to maintain the steady growth.

Default avatar
匿名 | Anonymous

中国模式就是“中国特色”

从某种意义上讲,中国模式就是强大的执政党加上高度集权的政府。这也算是中国模式无法照搬和仿效的原因之一吧。

此外,中国是一个有理想有目标的国家,而且其理想和目标得到了民众的认同和支持。这也不是轻易能学得来的。

The China model is “Chinese characteristics”

Regarding the meaning of the China model, it is a powerful ruling party combined with a highly centralized government. This is one of the reasons why other countries are unable to copy or imitate the China model. Besides that, China is a country with ideals and goals. Moreover, besides its ideals and goals, it has the approval and support of the populace. This is very difficult to study.

(Translated by Michelle Deeter)

Default avatar
匿名 | Anonymous

帮助中国,拯救地球

西方世界应该将中国在短期内取得的一切成就视为其几千年悠久历史的强烈重申。现在,西方世界(包括我在内)的大量消费并将环境问题归到东方国家头上,全世界应改携手帮助中国解决环境问题,因为它同欧美的过度消耗密不可分。Dominique C.

Helping China helping the World

Everything that China achieved in so little time should be viewed by the Western world as the proud reaffirmation of China's strong historical presence throughout millenniums.

And now, with the Western world (me included) consuming too much and blaming environmental problems on the Eastern world, the World population should gather and help China solving its environmental problems since pollution in China is directly linked with Occidental overweight consumption.

Dominique C.

Default avatar
匿名 | Anonymous

如何学习“中国模式”?

要想了解和学习“中国模式”,最好的方式是和中国建立广泛而深入的经济、政治和文化合作与交流,在这个过程中,才能真正管窥中国的文明积淀和实用主义哲学,也只有借用中国的”内功“,才能得到”中国模式“的精髓。我敢肯定,这样一定比纸上谈兵式的从理论上套用所谓的“模式”更有效果。这就叫做:学习”中国模式“,摸着石头过河。当以为然乎?

How to learn "Chinese model"

The best way to learn"Chinese model" is to build an extensive and .deep economic, political and cultural cooperation and exchanges .Only in this process,can we truly glimpse China's civilization and philosophy of pragmatism;Only by using China's "Internal Strength" ,can we obtain the essence of "China model" .Certainly,This must be effective than paper-based theory to apply the so-called "model" ,and this is "learning the China model, and feeling our way across the river". Do you agree with that?

Default avatar
匿名 | Anonymous

中国的增长

我觉得除了模仿西方发展途径外,中国本身博大精深的文化实力和对良好信用的孜孜以求也是一大优势。中国的对外关系要真实得多,尤其是与西方国家和其它的非西方大国相比起来。

China Growth

I feel apart from China copying development mechanism from the west, China herself has the capacity for deeper wisdom and continuing effort to its credit.

Cnina in her relationship with other nations is far more genuine, especially when compared with the West and many non western powers.