國際行動中心（The International Action Center）在比利時政治分析家馬克·範德皮特（Marc Vandepitte）的許可下發表了以下文章，該文章針對生活在歐洲的人們。他強烈反對美國和歐洲的統治階級即使與中國建立經濟合作關係確實大有好處、仍煽動民眾反對中國的行為。在範德皮特寫“我們”的地方，他指的是普通歐洲人。
這種對華友好的論點應用於美國經濟和美國工人階級時就更加必要了，美國工人階級沒有興趣敵視中國人民，相反，他們隻會從與這個亞洲國家的友好關係中獲益。此外，反對美國政府任何可能導致與中國發生戰爭的舉動也符合美國工人及其組織的利益。
本文原載國際行動中心網站，原文為英文。翻譯：郝俊龍。
中國經濟長達數十年的驚人增長，其秘訣到底是什麽？為什麽這是一件大好事，而歐洲應對的最佳方式又是什麽？
西方媒體對中國獨特的敘事框架
《經濟學人》的標題是“為什麽中國經濟不會妥善恢複和發展”。
美國有線電視新聞網（CNN）商業新聞頻道曾表示，“中國經濟經受了悲慘的一年。2024年可能會更糟。”
如果你相信這些主流媒體的鬼話，那中國的狀況確實就糟糕了：據說經濟發展的動力正停滯不前，或者情況要更糟糕，經濟正處於螺旋式的下降。
奇怪的是，國際貨幣基金組織預計中國今年的經濟增長率為4.6%。
這幾乎是歐洲的五倍之多，也是堪比美國的三倍規模。
西方媒體顯然正在與中國的增長奇跡作鬥爭，因此他們關注的是問題和挑戰。由於專注於進展不佳的事情，他們忽視了中國具有強大優勢的領域。
當然，中國經濟正麵臨一些重大挑戰，但盡管人口老齡化以及西方在投資和貿易方麵的敵意日益增加，中國仍然實現了歐洲夢寐以求的增長率。
在本文中，我們將探討這種長達數十年的驚人增長的原因。我們還研究了為什麽這是一件大好事，以及歐洲應對的最佳方式是什麽。
馬拉鬆式的漫長發展之路
讓我們從基本的事實開始。75年前，中華人民共和國成立時，中國是世界上最貧窮的國家之一。這是一個農業不發達的國家，在整個世界經濟中微不足道。其人均GDP是非洲的一半，是拉丁美洲GDP的六分之一。
從那時起，該國開始了一係列增長衝刺，逐漸演變成了一場經濟發展的長跑。過去四十年的經濟增長是世界曆史上最大、也是持續時間最長的一次。在此期間，人均GDP增長了驚人的50倍，即每年增長10%。最近，中國公民的平均財富已經超過了歐洲人（也包括歐洲大陸的南部和東部地區）。
1949年，中國經濟占世界生產總值的4.5%。目前，這一比例為19%（以購買力平價美元表示），比美國高出4個百分點。如果大家看一下工業生產，情況會變得更加令人印象深刻。
1990年，中國在全球工業生產中所占份額為2.5%。今天，這一比例為35%，相當於排在中國之後十大工業經濟體的總和。
就未來的綠色工業生產而言，中國是絕對的領先者。
2021年，中國新增的海上風能裝機容量超過了世界其他地區前五年的總和。
它使所有國家在太陽能電池板生產方麵都遠遠落後，到2030年，該國生產的電池數量將是所有其他國家總和的兩倍多。
每個國家和地區對太陽能電池板的需求和太陽能生產能力。
在過去的25年裏，該國還設法維持了經濟的有效運轉：1997年的亞洲金融危機，2001年的互聯網危機，國內的SARS病毒危機，2008年的金融危機以及最近的COVID-19新冠危機。關於2008年的危機，英國《金融時報》前記者理查德·麥格雷戈（Richard McGregor）寫道，“中國比世界上任何國家都更有能力應對突然發生的經濟衰退。（援引：McGregor R., The Party. The Secret World of China’s Communist Rulers, New York 2010, p. 12）
這種增長不僅是量的表現，而且是品質上的進步。技術和科學取得了巨大的飛躍。如今，中國企業在5G電信設備、高速列車、高壓輸電線路、可再生能源、新能源汽車、數字支付、人工智能等諸多領域被公認為世界的領先者，或已經走在各國前列。
好事連樁
這種經濟的擴展也在全球範圍內有所表現。中國是世界經濟的主要驅動力，占去年總增長的35%。包括歐洲和美國在內的許多國家都受益於這樣的火車頭推動作用。
2023年，中國是約120個國家最重要的貿易夥伴，也是許多國家首選和最後必選的資金款項借貸國。
當然，還有“一帶一路”倡議，即新絲綢之路，它代表了數百項投資、貸款、貿易協定和數十個經濟特區，價值9000億美元。
它們分布在72個國家和地區，總人口約為50億，占世界人口的65%。
此外，在“金磚+”背景下，與全球南方國家的合作日益增多。在這個聯盟內，通過以當地貨幣進行貿易交易來擺脫美元主導地位的實驗正在如火如荼地進行。
對於全球南方國家來說，這樣的經濟擴張是重大利好。這使他們有機會擺脫西方的統治地位，並最終與殖民主義決裂，而這一次是在經濟的層麵做到這一點。西方占主導地位的金融和經濟參與者都對此感到沮喪，這就是為什麽他們對中國越來越敵視的原因（見下文）。
盡管如此，中國經濟的崛起對北半球的發達國家來說也是一件好事。廉價的中國產品使通貨膨脹保持在較低水平，[歐洲國家]可以向這個亞洲巨人巨大的銷售市場出售大量商品和投資。
中國的秘訣
中國增長奇跡的關鍵要素如下：
1.農業。 革命初期，大量土地所有權被廢除，農業用地以長期貸款的形式發放給農民。此外，還建立了個人登記製度（戶口）。這避免了大多數第三世界國家常見的混亂的農村人口外流，那會導致大量非正規和非生產性勞動力的出現。
2.社會政策。從一開始，在教育、醫療和社會保障方麵投入了相對大量的資金。這確保了健康和熟練的勞動力，從而提高了生產力。工資很大程度上跟隨生產率的提高，一方麵帶來勞工環境下的社會和諧關係，另一方麵也創造了一個龐大而充滿活力的內部市場。
3. 基礎設施、技術和研發。中國堅決致力於基礎設施的發展，“科研發展”和尖端技術的發展。這些是任何經濟賴以進步的基本條件。2018年，中國在科學出版物數量上超過了西方，而到了2019年，專利數量也反超他們。如今，中國STEM領域（科學、技術、工程、數學）專業畢業生人數是美國的四倍。
4.開放性。與其他新興國家相比，自1978年以來，對外國投資和對外貿易非常開放。龐大且相對便宜的勞動力市場吸引了許多外國投資者，他們（暫時）受益於較低的勞動力成本和廣泛的內部市場。
外國投資和對外貿易本身都不是目標，而是起到了國家經濟目標和國內發展的功能，例如技術轉讓。
今天，新絲綢之路也為經濟擴展做出了貢獻。
5.穩定的政策。與全球南方的許多其他國家相比，中國的政治和經濟政策一直保持相對穩定。這增強了國內外投資者的信心。
6.地緣政治。除了在與印度接壤的邊境上發生了幾起小事件外，該國幾十年來沒有卷入暴力的國際衝突。這在投資和貿易方麵都改善了經濟環境。此外，與蘇聯不同，中國沒有與美國進行昂貴的軍備競賽。
7.計劃與控製。中國的經濟發展模式主要由國家主導，國家是一個多頭實體（見下一條）。經濟的關鍵部門掌握在中央或地方政府手中。此外，政府間接控製了大多數其他部門，例如，共產黨在大多數大中型公司中都有一定的控製權。
五年計劃為強有力的產業政策創造了一個有利的框架，幫助中國向高附加值製造業邁進。該模式還包括國有銀行向戰略性行業提供優惠貸款。
這種管理和規劃使該國的生產者能夠有效地行動起來並實現戰略目標。因此，中央政府發布了一項計劃和嚴格的指導方針，以優先考慮太陽能產業。幾年後，中國主導了這一領域。目前正在部署這支動員力量來開發半導體，以抵消該領域的抵製和製裁。
8. 權力下放和市場力量。與中國是中央計劃經濟的想法相反，中國實際上擁有世界上最去中心化的製度之一。地方政府擁有相當程度的自主權，管理著政府總支出的85%。
在經濟合作與發展組織（OECD）國家，這一比例平均僅為33%。
這種權力下放刺激了各省和大城市之間的競爭，這是第一個競爭領域。此外，公司在內部和與世界其他地區也有市場競爭，這是第二個領域。由於這種雙重競爭體係，公司不僅在不斷發展，而且在經濟格局中也有很大的活力。
例如，一個省或另一個省定期實施一項被證明非常有效的新政策，使他們比其他地區更具優勢，之後該倡議又被其他地區複製采納。
中央政府的作用主要在於製定寬泛的目標和管理人力資源。後者非常實用，因為地方官員知道，如果他們比同僚做得更好，他們就會走上中央政府提拔的路徑。
換言之，在這種模式下，在一個明確的市場體係中，有相當多的私人主動性空間。請注意，隻要不妨礙聯合長期規劃的經濟和社會目標，市場機製就會容忍和鼓勵。或者正如2023年8月14日《金融時報》主編拉娜·福魯哈爾（Rana Foroohar）所說：“自由市場總是為國家服務，而不是反過來。”
在這方麵，中國模式明顯不同於蘇聯模式。在那裏，一切都得計劃到最後一個細節，幾乎所有的生產都掌握在政府手中，幾乎談不上什麽競爭。
當然，蘇聯在其前六十年中取得的經濟成就也是無與倫比的。但是，由於市場機製的消除，幾乎沒有經濟激勵來鼓勵生產者進行經濟的、有利可圖或高質量的生產。而在中國，這個問題已經被克服了。
9. 靈活性。中國共產黨人對經濟政策的態度是務實的。他們能夠靈活地應對不斷變化的環境。自1970年代末以來，生產力的擴大和現代化一直是中心目標。當時，該模式基於出口以及對重工業、建築、製造業和基礎設施的投資。
這十餘年來，新模式的驅動一直是增加繁榮（國內市場），增加服務業，並通過攀登更高的技術階梯來創造更大的附加值。
西方徹底的誤判
中國發展的妙招與資本主義國家的舉措形成鮮明對比。在後者那裏，跨國公司和金融資本占據了主導地位。在那裏，短期利潤是壓倒一切的目標。在那裏，政府專注於通過儲蓄（減少對工人的社會服務）來消除財政赤字。
中國方法的特點是他們以驚人的方式應對了2008-2009年的金融危機。中國政府啟動了占GDP為12.5%的刺激計劃，這可能是和平時期有史以來規模最大的計劃。中國經濟幾乎沒有動搖，而歐洲經濟則在十年內失去動力。
歐洲中心主義和持續的自滿情緒導致西方完全誤解了中國的經濟和社會。
2001年，當美國和其他西方國家允許中國加入世界貿易組織時，人們認為中國會變得像我們一樣。
通過將其納入世界市場，[他們以為]中國將放棄社會主義，擁抱資本主義。
但情況似乎恰恰相反。中國堅持其社會主義道路，並成功地使我們的經濟更像他們的模式。歐洲（《綠色協議》）和美國（《降低通脹法案》）都放棄了自由放任的做法，並在幾年前轉向了真正的產業政策，其特點是發放數千億美元的補貼。我們卻一直指責中國這種做法。事態可能會有所轉變。...
歐洲將何去何從？
不過情況並不止於模仿。今天，美國正在竭盡全力破壞中國的經濟進步。
他們不僅拒絕中國獲得某些技術，還試圖破壞整個行業，包括阻止向中國出口高科技芯片。
例如，國家安全顧問傑克·沙利文（Jake Sullivan）在一次演講中（whitehouse.gov，2022年9月16日）表示，他的政府希望阻礙中國在人工智能、生物技術和清潔能源技術等基礎技術方麵的能力，以使自身能夠在氣候變化方麵保持最大領先優勢。
華盛頓正試圖將西方盟友拖入這場經濟戰爭。但實際上這不會理所當然地任其發生。西方經濟與中國經濟緊密相連，在許多領域，西方更需要中國。例如，沒有中國，歐洲就不可能實現其氣候目標。
貿易戰的代價可能非常高。如果沒有中國的廉價出口和生產，工業國家將麵臨巨大的通脹壓力，特別是在向清潔技術過渡方麵。
根據國際貨幣基金組織（IMF）的數據，與中國經濟“脫鉤”和選擇保護主義的代價可能達到世界GDP的7%，這驚人的7%相當於今天每年超過7萬億美元。這是官方發展援助總額的35倍，是實現能源轉型每年所需援助的3.5倍。
與中國的貿易戰將不可避免地招致報複措施。除了因對華出口損失而可能造成的巨大經濟損失外，該國還擁有我們嚴重依賴的必需品。
例如，電動汽車發動機、風力渦輪發電機和導彈製導係統所需的90%專用磁體都是在中國生產。此外，中國加工了全球72%的鈷和61%的鋰，這兩種礦物是生產電動汽車的重要礦物。
最後，製裁很有可能產生與華盛頓當局完全相反的效果，實際上反而會鼓勵中國加速發展其戰略產業。現在，這種情況正在半導體和芯片領域上演。
整個問題在於，歐洲是否會被卷入這種新的冷戰邏輯，從而搬起石頭砸自己的腳。在經濟上，歐洲比美國更受中國的影響。例如，中國是德國最大的貿易夥伴，也是德國產業公司的重要市場。全球經濟的重心正日益向亞洲轉移，而中國則是火車頭。對於歐洲來說，錯過這種增長勢頭是非常不明智的。
歐洲正站在一個重要的曆史十字路口。它會讓自己拖入美國發起的破壞性貿易戰，還是會成功地製定自身的自主路線，並在互惠互利的基礎上與中國開展建設性的經濟關係？這事關重大。
參考文獻：
Yifu Lin J., Demystifying the Chinese Economy, Cambridge 2012
Hsueh R., China’s Regulatory State. A New Strategy for Globalization, London 2011Herrera R. & Zhiming Long., La Chine est-elle capitaliste ?, Paris 2019Marsh C., Unparalleled Reforms. China’s Rise, Russia’s Fall, and the Interdependence of Transition, Lanham 2005Dickson B., Ted Capitalists in China. The Party, Private Entrepreneurs and Prospects for Political Chance, Cambridge 2003Minqi Li, The Rise of China and the Demise of the Capitalist World Economy, New York 2008Minqi Li, China and the 21st Century Crisis, London 2016Delaunay J., Les Trajectoires chinoises de modernisation et de développement. De l’Empire agro-militaire à l’état-Nation et au socialism, Paris 2018Bickers R., Out of China. How the Chinese Ended the Era of Western Domination, London 2017Ross J., China’s Great Road. Lessons for Marxist theory and socialist practices. Articles 2010-21, New York 2021Larcy N., The State Strikes Back. The End of Economic Reform in China? Washington 2019Mahbubani K., Has China Won? The Chinese Challenge to American Primacy, New York 2020
Why is China's economy doing so well and why is that a good thing?
https://iacenter.org/2024/04/06/why-is-chinas-economy-doing-so-well-and-why-is-that-a-good-thing/
By Marc Vandepitte April 4, 2024
The International Action Center publishes the following article with the permission of the Belgian political analyst Marc Vandepitte, who addresses people living in Europe. He makes a strong argument opposing the efforts of the U.S. and European ruling class to turn the population against China, despite the advantages of having cooperative economic relations with China. In places where Vandepitte writes “we” or “us,” he is referring to ordinary Europeans.
This argument for friendship toward China is even more necessary when applied to the U.S. economy and to the U.S. working class, which has no interest in hostility toward Peoples China and which, on the contrary, can only gain from friendly relations with the Asian country. In addition, it is in the interest of U.S. workers and their organizations to oppose any moves of the U.S. government that could lead to a war with China.
What is the secret of the decades-long spectacular growth of the Chinese economy, why is that a good thing, and what is the best way for Europe to respond to it?
Peculiar media framing
The Economist headline was “Why China’s economy won’t be fixed.” CNN Business had “China’s economy had a miserable year. 2024 might be even worse.”
If you believe the mainstream media, China is in bad shape: the economic engine is said to be sputtering, or worse, the economy is in a downward spiral. Bizarre, as the IMF expects economic growth of 4.6 percent in China this year. That is almost five times as much as in Europe and more than three times as much as in the U.S.
The Western media are apparently struggling with China’s growth miracle, and so they focus on the problems and challenges. By concentrating on what is going less well, they miss what China is very strong at.
Certainly, the Chinese economy is facing some significant challenges, but despite an aging population and increasing hostility from the West, both in terms of investment and trade, the country is still achieving growth rates that Europe can only dream of.
In this article, we are exploring the reasons for this decades-long spectacular growth. We also look at why this is a good thing and what is the best way for Europe to respond.
Development marathon
Let’s start with the facts. 75 years ago, when the People’s Republic was founded, China was one of the poorest countries in the world. It was an agricultural, underdeveloped country, insignificant in the world economy. Its GDP per capita was half that of Africa’s and one-sixth of Latin America’s GDP.
Since then, the country has embarked on a series of growth sprints growing into a development long distance run. The economic growth over the past forty years was the largest and longest-lasting in world history. During that period, GDP per capita rose by a staggering factor of 50, which is an increase of 10 percent per year. Recently, the average wealth of a Chinese citizen has surpassed that of a European (when also including the southern and eastern regions of mainland Europe).
In 1949, the Chinese economy accounted for 4.5 percent of world product. Currently that is 19 percent (expressed in PPP dollars), or 4 percentage points more than the U.S. If you look at industrial production, things get even more impressive. In 1990, China’s share of global industrial production was 2.5 percent. Today that is 35 percent, as much as the next ten industrial economies combined.
In terms of industrial production of the future — green production — China is the absolute leader. In 2021, it added more offshore wind energy capacity than the rest of the world in the previous five years combined. It leaves all countries far behind in the production of solar panels (see graph), and by 2030 the country will produce more than twice as many electric batteries as all other countries combined.
The demand for solar panels and the production capacity for solar energy per country and region.
The country has also managed to keep its economy afloat in the storms of the last 25 years: the Asian financial crisis in 1997, the dot-com crisis in 2001, the SARS crisis at home, the great financial crisis of 2008 and recently the COVID-19 crisis. In relation to the 2008 crisis, former Financial Times journalist Richard McGregor wrote that, “China was better equipped than just about anywhere in the world to handle the sudden downturn.” [McGregor R., The Party. The Secret World of China’s Communist Rulers, New York 2010, p. 12]
The growth is not only quantitative but also qualitative. Great leaps forward have been made in technology and science. Today, Chinese companies are widely recognized as world leaders, or as being at the cutting-edge, in 5G telecommunications equipment, high-speed trains, high-voltage transmission lines, renewable energy sources, new energy vehicles, digital payments, artificial intelligence and many other areas.
Good thing
This economic expansion is also manifesting itself globally. China is the main driving force of the world economy, accounting for 35 percent of total growth last year. Many countries, including in Europe and the U.S., benefit from this locomotive function. In 2023, China was the most important trading partner of about 120 countries and the lender of first and last resort for many.
And of course there is the Belt and Road Initiative, the new Silk Road, which represents hundreds of investments, loans, trade agreements and dozens of Special Economic Zones, worth $900 billion. They are spread over 72 countries, with a total population of approximately 5 billion people or 65 percent of the world’s population.
In addition, there is an increasing cooperation with countries from the Global South in the context of BRICS plus. Within this alliance, experiments are in full swing to move away from the dominance of the dollar by conducting trade transactions in local currencies.
For the countries of the Global South, economic expansion is a very good thing. It gives them the opportunity to get rid of Western dominance and finally break with colonialism, this time economically. The dominant financial and economic players in the West are watching this with dismay, which is why they are growing more hostile towards China (see below).
Nevertheless, China’s economic rise is also a good thing for the countries of the North. Cheap Chinese products keep inflation low and [European countries] can sell a lot of [their] goods and investments to the Asian giant’s huge sales market.
Recipe
The key ingredients of the Chinese growth miracle are the following:
1. Agriculture. At the beginning of the revolution, large land ownership was abolished, and agricultural land was given on long term loans to the peasants. In addition, a system of personal registration (Hukou) was set up. This has avoided the typical chaotic rural exodus known in most Third World countries, resulting in massive informal and unproductive labor.
2. Social policy. From the start, a relatively large amount has been invested in education, health care and social security. This ensures a healthy and skilled workforce, which improves productivity.
Wages largely follow productivity increases, which on the one hand leads to social peace in the workplace and on the other hand has created a large and dynamic internal market.
3. Infrastructure, technology and R&D. China is fully committed to the development of infrastructure, “Research & Development” and the development of cutting-edge technology. These are basic conditions for any economic progress. In 2018, China overtook them in terms of the number of scientific publications and in 2019, the same was true for the number of patents. Today, four times as many students graduate in STEM fields [Science, Technology, Engineering, Mathematics] in China as in the U.S.
4. Openness. Compared to other emerging countries, there has been great openness to foreign investment and foreign trade since 1978. The large and relatively cheap labor market has attracted many foreign investors who benefit from (temporarily) lower labor costs and an extensive internal market.
Neither foreign investments nor foreign trade are goals in themselves but are functions of national economic goals and domestic development, see for example technology transfer. Today, the new Silk Road also contributes to economic expansion.
5. Stable policy. Compared to many other countries in the Global South, China has maintained relatively stable political and economic policies. This has contributed to the confidence of both domestic and foreign investors.
6. Geopolitics. Apart from a few minor incidents on the border with India, the country has not been involved in violent international conflict for decades. This improves the economic climate in terms of both investments and trade. In addition, unlike the Soviet Union, China has not embarked on an expensive arms race with the U.S.
7. Planning and control. China’s economic development model is largely led by the state, which is a many-headed entity (see next item). The key sectors of the economy are in the hands of the government, centrally or locally. In addition, the government indirectly controls most of the other sectors, e.g., through the controlling presence of the Communist Party in most medium and large companies.
A five-year plan creates a favorable framework for a robust industrial policy that helps China move up to higher value-added manufacturing. The model also includes state-owned banks providing favorable loans to strategic industries.
This management and planning allow effective mobilization of the country’s producers for strategic objectives. Thus, a plan and strict guidelines were issued by the central government to prioritize the solar industry. A few years later, China dominated this sector. This mobilizing force is currently being deployed for the development of semiconductors to offset the boycott and sanctions in this sector.
8. Decentralization and market forces. Contrary to the idea that China is a centrally planned economy, the country actually has one of the most decentralized systems in the world. Local governments have a remarkable degree of autonomy, managing 85 percent of total government expenditure. In the OECD [Organisation for Economic Co-operation and Development] countries, this is on average only 33 percent.
This decentralization stimulates competition between provinces and large cities, which is a first sphere of competition. In addition, companies compete in the market, both internally and with the rest of the world, which is the second sphere. Due to this dual system of competition, companies are not only constantly evolving, but there is also great dynamism in the economic landscape.
For example, regularly one province or another implements a new policy that proves to be very effective, giving them an advantage over other regions, after which the initiative is copied by those others.
The role of the central government lies mainly in setting broad objectives and managing human resources. The latter is very functional, because local officials know that if they do better than their colleagues, they are on track for promotion by the central government.
In other words, in this model there is room for quite a lot of private initiative within a well-defined market system. Please note that the market mechanism is tolerated and encouraged as long as it does not hinder the economic and social objectives of the joint long-term planning. Or as Rana Foroohar, editor-in-chief of the Aug. 14, 2023, Financial Times, puts it: “The free market is always in service to the state, not the other way around.”
In this respect, the Chinese model clearly differs from that of the Soviet Union. There, everything was planned down to the last detail, almost all production was in the hands of the government, and there was little or no competition.
Certainly, what the Soviet Union achieved economically in its first sixty years is unparalleled. But due to the elimination of the market mechanism, there was almost no economic incentive to encourage producers to produce economically, profitably or with high quality. In China this problem has been overcome.
9. Flexibility. The Chinese communists have a pragmatic and down-to-earth attitude towards economic policy. They respond flexibly to changing circumstances. Since the end of the 1970s, the expansion and modernization of the productive forces has been the central objective. At the time, the model was based on exports and on investments in heavy industry, construction, manufacturing and infrastructure.
Since Xi Jinping took office about ten years ago, the driving force of the new model has been increasing prosperity (domestic market), increasing the service sector and creating greater added value by climbing higher up the technological ladder.
Completely misjudged
The Chinese recipe is in stark contrast to that of capitalist countries. There, multinationals and finance capital hold sway. There, short-term profit is the overriding goal. And there, governments are fixated on eliminating fiscal deficits through savings [which decrease social services for workers].
Characteristic of the Chinese approach is the spectacular way in which they tackled the financial crisis of 2008-2009. The Chinese government launched a stimulus program of 12.5 percent of GDP, probably the largest peacetime program ever. The Chinese economy barely budged while Europe’s was out of steam for a decade.
Eurocentrism and persistent complacency have caused the West to completely misunderstand the Chinese economy and society. When the U.S. and other Western countries allowed China to join the World Trade Organization in 2001, it was assumed that China would become like us. By integrating it into the world market, [they believed] China would abandon socialism and embrace capitalism.
But the opposite seems to be happening. China has stuck to its socialist course and has also succeeded in making our economies more like theirs. Both Europe (Green Deal) and the United States (Inflation Reduction Act) have dropped their laissez-faire approach and a few years ago switched to a real industrial policy, characterized by handing out hundreds of billions in subsidies, something we have always blamed the Chinese for. Things may change. …
Quo vadis Europe?
But things don’t stop at imitation. Today, the United States is doing everything it can to sabotage Chinese economic progress. Not only do they deny China access to certain technologies, they also try to undermine entire industries, including by preventing the export of high-tech chips to China.
For example, National Security Advisor Jake Sullivan said in a speech (whitehouse.gov, Sept. 16, 2022) that his administration wanted to hamper China’s capabilities in foundational technologies such as artificial intelligence, biotechnology and clean energy technologies, in order to enable them to maintain the greatest possible lead on climate change.
Washington is trying to drag Western allies into this economic war. But that won’t happen as a matter of course. Western economies are closely intertwined with the Chinese economy, and in many areas the West needs China more than the other way around. For example, Europe cannot possibly achieve its climate goals without China.
The costs of a trade war may be very high. Without cheap exports and production from China, there will be significant inflationary pressures in industrialized countries, especially regarding the transition to cleaner technologies.
According to the IMF, the costs of economic ‘decoupling’ from China and the choice of protectionism could amount to an alarming 7 percent of world GDP, which would amount to more than $7 trillion annually today. That is 35 times the total official development assistance and 3.5 times as much as what is needed annually to achieve the energy transition.
A trade war with China will inevitably lead to retaliatory measures. Apart from potentially large financial losses due to loss of exports to China, the country also possesses essential goods on which we are heavily dependent.
For example, 90 percent of the specialized magnets needed in electric vehicle engines, wind turbine generators and missile guidance systems are produced in China. In addition, China processes 72 percent of the world’s cobalt and 61 percent of lithium, two essential minerals for the production of electric cars.
Finally, there is a high probability that sanctions will have exactly the opposite effect of what Washington had in mind and will actually encourage China to accelerate the development of its strategic industries. This is now happening in the field of semiconductors and chips.
The whole question is whether Europe will be drawn into this new Cold War logic and thus shoot itself in the foot. Economically, Europe is more exposed to China than the U.S. For instance, China is Germany’s largest trading partner and a crucial market for German industrial companies. The center of gravity of the global economy is increasingly shifting towards Asia, with China as the locomotive. For Europe, it would be very unwise to miss out on this growth momentum.
Europe stands at an important crossroads in history. Will it allow itself to be dragged into a destructive trade war initiated by the U.S., or will it succeed in charting its own autonomous course and building a constructive economic relationship with China, based on mutual benefit? The stakes are high.
Sources:
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Minqi Li, The Rise of China and the Demise of the Capitalist World Economy, New York 2008
Minqi Li, China and the 21st Century Crisis, London 2016
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