To set the
stage for President Hu Jintao's April 2006 US
visit, the September/October 2005 issue of Foreign
Affairs published as its lead article "China's
'peaceful rise' to great power status" by Zheng
Bijian, chairman of the influential China Reform
Forum.
The term "peaceful rise" describes
a policy of bringing China out
of
poverty by embracing economic globalization and
improving relations with the rest of the world, as
China's continued development depends on and will
in turn reinforce world peace. Zheng wrote that
"the most significant strategic choice the Chinese
have made was to embrace economic globalization
rather than detach themselves from it".
While "peaceful rise" (heping
jueqi) has since been replaced by "peaceful
development" (heping fazhan) in the
official white paper released by the Information
Office of the Chinese State Council in December
2005, the recent US invitation to China to become
a "stakeholder" in the US-dominated international
system and the post-Cold War unipolar world order
engineered by the US has given the appeasement
faction in Chinese political circles new
ideological energy.
It is ironic that
China is now rushing to join the globalization
game when neo-liberal free trade is encountering
vocal resistance everywhere else, even in US
domestic politics. Such resistance has been
generated by the structural imbalance created by
excessively high return to transnational capital
derived from low, stagnant wages imposed globally
on labor. The win-win claim of globalization has
revealed itself as one giant hoax.
While
it is not necessarily a bad move for China to be
involved with globalization, it is necessary for
China to take the lead in reordering the unequal
terms of trade in current economic globalization
to provide a level playing field for labor, not
just in China, but throughout the whole world,
including the advanced economies. The benefits of
wealth creation from global trade have been
dissipated by maldistribution. The whole world is
now crying out for a new economic world order in
which growth will benefit the poor and not just
the rich, both among individuals inside an economy
and among economies of uneven wealth and
development.
Zheng Bijian acknowledges
that China's rapid development since 1978 has been
"narrow and uneven". He uses this fact to argue
why China is not a threat to peace, to the US, or
any other great powers. Unfortunately, the
opposite is likely: unless economic development in
China starts to produce more broad-based equality,
the resultant socio-political instability will
threaten peace in the world.
The past 27
years of reform and growth, Zheng wrote in his
article in 2005, showed the world "the magnitude
of China's labor force, creativity, and purchasing
power; its commitment to development; and its
degree of national cohesion". Zheng asserted that
"once all the potential of the Chinese workforce
is mobilized, its contribution to the world as an
engine of growth will be unprecedented". This is
true. But the key is a fast, sharp rise in worker
income, which unfortunately global neo-liberal
trade is structured to prevent everywhere,
particularly in the exporting economies.
Zheng also rightly allows that "economic
growth alone does not provide a full picture of a
country's development. China has a population of
1.3 billion. Any small difficulty in its economic
or social development, spread over this vast
group, could become a huge problem. And China's
population has not yet peaked; it is not projected
to decline until it reaches 1.5 billion in 2030.
Moreover, China's economy is still just
one-seventh the size of the United States' and
one-third the size of Japan's. In per capita
terms, China remains a low-income developing
country, ranked roughly 100th in the world. Its
impact on the world economy is still limited."
According to Zheng, the formidable
development challenges still facing China stem
from the constraints it faces in pulling its
population out of poverty. The scarcity of natural
resources available to support such a huge
population - especially energy, raw materials, and
water - is increasingly an obstacle, especially if
the efficiency of use and the rate of recycling of
those materials are not improved. China's per
capita water resources are one-fourth of the
amount of the world average, and its per capita
area of cultivatable farmland is 40% of the world
average. China's oil, natural-gas, copper, and
aluminum resources in per capita terms amount to
8.3%, 4.1%, 25.5%, and 9.7% of the respective
world averages.
Zheng thinks that for the
next few decades, the Chinese nation will be
preoccupied with securing a more decent life for
its people. Since the third Plenary Session of the
11th Central Committee of the Chinese Communist
Party in 1978, the Chinese leadership has
concentrated on economic development. Responding
to its national conditions while conforming to the
tides of history, the path China will follow
toward modernization can be called "the
development path to a peaceful rise" driven by
capital, technology, and resources acquired
through peaceful means, rather than imperialism,
asserts Zheng.
Yet such aims cannot be
achieved by an export policy in a globalization
regime under the tyranny of US dollar hegemony.
Chinese appeasement on neo-liberal ideology and
market fundamentalism will not provide the
stability that China seeks to develop its economy,
as the resultant income and wealth disparity in
the past decade, both between people and regions,
has so far shown. It will instead create
socio-economic instability that will translate
into political instability.
Zheng points
out that according to China's strategic plans, it
will take until 2050 before it reaches the level
of a modernized, medium-level developed country.
Along this long path, China will face three big
challenges: (1) shortage of resources, (2)
environmentally sustainable development and (3)
imbalance between economic and social development.
The third challenge, Zheng notes, is
already visibly reflected in a series of tensions
Beijing must confront: between high GDP (gross
domestic product) growth and social progress;
between upgrading technology and increasing
employment; between keeping development momentum
in the coastal areas and speeding up development
in the interior; between fostering urbanization
and conserving agricultural land; between
narrowing the gap between the rich and the poor
and maintaining economic vitality and efficiency
in the market mechanism; between attracting more
foreign investment and enhancing the
competitiveness of indigenous enterprises; between
deepening reform and preserving social stability;
between opening domestic markets and solidifying
economic independence; between promoting
market-oriented competition and providing a
socio-economic safety net to take care of those
displaced through no fault of their own. To cope
with these dilemmas successfully, a number of
well-coordinated policies are needed to foster
development that is both faster and more balanced,
according to Zheng.
Yet all the undeniable
tensions listed above have been the structural
by-products of China's excessive dependence on
export as the main engine of growth in the past
decade.
Stuck in 'takeoff'
mode In 1978, when Deng Xiaoping introduced
economic reform and an "open to the outside"
policy, the intention was to focus on export only
as an initial "takeoff" stratagem, not a permanent
plan. This was necessary to overcome dismal
Chinese economic conditions left by decades of US
embargo and internal political disorder. In 1978,
the Chinese economy was so poor and decrepit that
export financed by foreign capital was the only
sensible option. It was expected that after the
initial decade of using joint ventures with
foreign capital with technology transfer to
kick-start the stalled Chinese economy, foreign
trade would be put back in its proper place as an
auxiliary component of domestic development. The
first law on foreign joint ventures limited their
term to nine years, after which full ownership
would be transferred back to China.
Instead, events since 1989 have permitted
the runaway export sector to become the tail that
wags the dog in Chinese economic
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