By Dīng Yīfán / WeChat
Observer: Before the epidemic, China’s economy maintained a high growth rate of 6%-7%, what do you think are the key points and highlights of the economy in the past decade?
Ding Yifan: Chinese society has undergone many changes in the past decade, the biggest highlight of which is the economic transformation. We have transformed from an economic model with strong external dependence and export-led growth to a “new normal”, which is characterized by not relying too much on external sources and mainly using internal infrastructure investment to drive economic growth.
There are several bright performance, one is the effectiveness of infrastructure investment gradually emerged, after 2008 our country increased investment in infrastructure, after ten years of development, railroad mileage from 2012 about 98,000 km to 15 million km in 2021, high-speed rail mileage from only a few hundred kilometers to 40,000 km in 2021, the development rate is very fast, just a dozen years jumped to become a leading global power in just a decade.
There are now a variety of short videos on the Internet where some foreign tourists come to China and post videos of China’s high-speed rail. Foreign netizens are in awe, praising China’s infrastructure and achievements, which is some proof of China’s development mindset, achievements that many large Western countries do not have. They compared China’s airports with their countries’ airports and generally agreed that China’s infrastructure development has greater advantages.
The second highlight of economic development is poverty alleviation, which is not only progress in economic development, but also a manifestation of social justice. Why do we define ourselves as a socialist country with Chinese characteristics? The reason why we emphasize socialism is that we believe that the development of a country should ultimately benefit the people, especially the vulnerable groups.
The goal of our country’s economic development is to help the people get rid of poverty completely and let the disadvantaged live a decent life. China has made outstanding achievements in eliminating absolute poverty in recent years, especially compared to developed countries.
In addition, our achievements in environmental protection are also outstanding, and environmental protection results are constantly showing. General Secretary Xi put forward the scientific concept of “lucid waters and lush mountains are invaluable assets” in Zhejiang. This concept has been vigorously promoted at the national level, and the implementation efficiency and social benefits have been improved. It can be clearly seen from the air quality in Beijing that ten years ago, due to industrial pollution and other reasons, the sky in Beijing was foggy and was often ridiculed by foreigners.
Today, Beijing’s air pollution problem has been fundamentally resolved. Overall, our country has made great progress in pollution control and ecological restoration. On the other hand, my country’s sustainable development has also made great progress, such as reducing traditional energy consumption and vigorously developing renewable energy. Our achievements in this regard have far exceeded the five-year plan, which is the direction we have been working towards.
At present, the proportion of renewable energy in my country’s energy consumption has reached 15%, and the target is achieved one or two years earlier than expected. China still maintains a relatively rapid development speed. What is worth looking forward to is that in the future, in the development of renewable energy, China will have more and more investment opportunities, and its strength will become stronger and stronger.
Statistics show that the proportion of solar photovoltaic power generation in China’s renewable energy accounts for 32% of the world’s total, with nearly one-third of the world’s renewable energy capacity. If other clean energy sources, such as wind energy, hydropower, etc. are added, China’s cumulative share of the world’s clean energy The proportion of energy generation is more than 40%, which is a very large proportion. At the same time, if the proportion of clean energy use continues to increase, the sales of power-consuming products will also increase, which are huge advances in China’s development in recent years.
In addition, China’s electric vehicle industry is also developing very well. China has become the second largest exporter of automobiles in the world, second only to Japan. This export volume mainly relies on electric vehicles instead of traditional vehicles; the reason for the leap-forward development is that our country has the confidence and sufficient renewable energy.
These advances have promoted the common development of my country’s upstream and downstream industries. Behind the development, we can see huge technological progress. For example, the use of renewable energy is essentially the development of battery technology. Our technologies in the fields of solar power generation and wind power generation are all in the world. leading level.
Observer: In 2020, the Central Committee of the Communist Party of China (CPC) proposed for the first time “to build a new development pattern with the domestic circulation as the main body and the domestic and international circulation promoting each other.” This time, the 20th Party Congress report again raises this point, and emphasizes enhancing the endogenous power and reliability of the domestic circulation, and improving the quality and level of the international circulation. How to understand the enhancement of the endogenous power and reliability of the domestic circulation?
Ding Yifan: China saw the return of external economic uncertainty early on, mainly in several ways.
After the financial crisis in 2018, many developed countries have experienced “anti-globalization” sentiments, such as the election of Donald Trump as president of the United States as a “political vegetarian”, which is a reflection of some kind of inflated popular sentiment, and the Occupy Wall Street movement, which makes us realize that The countries that previously promoted economic globalization are retreating and developing “anti-globalization”.
Against this backdrop, the Chinese government’s economic policies are constantly being adjusted, and we have proposed the “double cycle” concept, the internal logic of which is to stimulate internal circulation; we have also proposed the “unification of China’s big market” because our country, after eliminating absolute poverty, immediately aims at the goal of common prosperity. These policies are intrinsically linked to the goal of common prosperity.
We are acutely aware that shared prosperity is the only way to make our market bigger and bigger and to bring our demographic advantages into play. The larger the population and the stronger the purchasing power, the larger the market will be and the more resilient the economy will be, which will greatly benefit us in securing the internal circulation. Trying to support economic growth through the internal market is impossible if there is a serious distribution inequality in the internal economy and a virtuous internal circulation cannot be formed.
The logic of economics is bred in the concept of common wealth. The larger the market, the more resilient the economy will be, and it is very important that the domestic economy can sustain its own economic growth regardless of changes in international trade and the external economic situation.
Many Western countries are now spreading the concept of “reverse globalization”, and the current Russia-Ukraine conflict also shows that the influence of geopolitical factors will outweigh the influence of economic rational factors, so the next step, whether the United States or Europe to promote alliance policies, will seriously undermine the original economic globalization context, the basic economic model based on market distribution. As a result, the economic efficiency of other countries and regions will drop significantly, and inflation will rise sharply, thus plunging into endless stagflationary troubles. In this scenario we need to ensure domestic internal circulation more than ever so as to ensure greater resilience against external influences.
Observer: For the first time, the report mentions “effective improvement of quality” and “reasonable growth of quantity” in economic development, which is very striking. The previous expression was “steady improvement in quality and reasonable growth in quantity”. How do you interpret this phrase?
Ding Yifan: China’s economy has improved significantly in terms of quality, and will have to promote steady improvement in the future. In terms of the development of the service industry, the development of the service industry is closely related to technological progress, and the digital economy and digital services are constantly improving, so that ordinary people actually feel the convenience of life, and this convenience is not all because of the huge growth of economic volume.
For example, bike-sharing and e-commerce have made our travel and consumption more convenient, changed the specific shape of our lives, played a big role in improving the quality of the economy, and will steadily advance in the future.
Observer: The report of the 20th National Congress emphasized the “endogenous power and reliability” of the domestic cycle, and the organic combination of supply-side reform and demand expansion, especially the expansion of domestic demand. In light of the doubling of per capita disposable income in China in the past decade, how do you think China’s disposable income can be maintained at a better level?
Ding Yifan: We need to keep raising the disposable income of the residents, because the growth of disposable income is an important driving force to ensure the growth of the domestic consumption market, and now we need to prevent falling into another trap, that is, the “pot-luck” trap, which we have experienced in the past development.
In the report of the twentieth session, it is once again emphasized that the distribution according to labor is the mainstay, and our country is vigorously encouraging all people to become rich, and people should obtain more income by labor. I believe that raising everyone’s disposable income cannot be done by handing out money. The United States has tried this, but this means is not effective in encouraging the people’s enthusiasm. If the policy of egalitarianism or even absolute egalitarianism is pursued, the consequence will be the demotivation of the workers.
We have experienced the “big pot rice”, the end result is that everyone is giving up, the economy is difficult to develop. The paradox of this issue is that on the one hand we want to encourage higher incomes, but on the other hand we want to prevent falling into the “pot luck” trap.
Observer: In the report of the 20th National Congress, the security of development is given a more prominent position, “ensuring the initiative of China’s development and security”. The word “security” appears frequently, how do you see the importance of “security” at this stage?
Ding Yifan: Security issues are very important, and we need to ensure the full supply of the domestic industry chain in the future. If security issues are not guaranteed, development can not be discussed. If we are completely constrained in semiconductor R&D and manufacturing, then the pace of economic development will be disrupted, and the security of semiconductor supply is the key to ensure the success of China’s next industrialization.
The United States wants to lock up China on security issues, and we need to make a counterattack. Europe is a lesson from the past, and now the European manufacturing industry is suffering from energy shortages. There is a view that the U.S. is creating a geopolitical crisis through the Russia-Ukraine conflict with the aim of bringing down Europe, which releases a clear warning to us that we cannot fall into Europe’s predicament on energy issues, otherwise we will lose the prerequisites for economic development and the manufacturing industry will face total paralysis. Now, the U.S. is creating energy supply barriers and industrial chain impediments, essentially to cause greater distress to China’s long-term development and security issues.
Observer: The report proposes to “comprehensively promote the great rejuvenation of the Chinese nation with Chinese modernization”. How do you understand “Chinese modernization”?
Ding Yifan: This is an interesting topic. Some Western countries think that “modernization” is equivalent to “Westernization”, and later the United States even proposed that “modernization” means “Americanization”. Later, the United States even proposed that “modernization” is “Americanization”, and Europe is also leaning toward “Americanization”.
When the United States was on its economic rise, it presented a well-developed situation in the fields of science and technology, life and economy, and became a beacon for some countries, with which many countries identified very strongly. With the rise of China, however, this phenomenon began to change. The U.S. is unable to balance global interests, and as problems within society arise, more and more people are beginning to suspect that “Americanization” is a false proposition.
Chinese society, in its past development, has also identified with the modernization program proposed by the United States, however, this perception has now changed dramatically. If modernization consists of technological progress, social adjustment, and adaptation to new forms of life and development situations, I believe that China has the ability to redefine modernization.
Why is “modernization” the same as “Americanization”? The United States tries to secure the trust of other countries at the ideological level, but we should find that ideological infiltration has its falsehoods, for example, they think that the United States is based on cultural and institutional development, but in fact it is not, and its development is promoted by plundering and exploitation. They have “snatched” all kinds of talents and resources by the advantage of rapid industrialization.
After World War II, the United States “plundered” some 20,000 scientists and engineers from Germany, on which they developed, but now they claim that their culture is superior and that they are more civilized. At a particular stage of development, many of us believed this falsehood, and when China developed on its own, we discovered that we could develop without being dependent on the United States and its ideology, and that we had more cultural confidence when we developed on our own. Now that American society is declining, China’s “Chinese modernization” is a belief that our own modernization will go a long way.
Chinese style modernization has many characteristics. In terms of values, it is not only individualism that drives modernization. Extreme individualism is the core value of American-style modernization, and the Chinese dream, the great rejuvenation of the Chinese nation, and the rise of the Chinese nation contain the idea of collectivism, which is completely different from individualism.
The remarkable achievements of China’s modernization and industrialization development have verified that our development logic is correct, and that individuals cannot be fully developed if we are separated from the collective and the nation. It is precisely because our country has accumulated strength in its development that the development of individuals has become better and better, and it can be said that the fate of the country and individuals are closely linked.
Of course, values are different and development models are different. Step by step, our social development achievements are driven through the state, including poverty reduction policies, etc. These achievements have to be achieved not only through individual struggle, but also through national organizations and state power.
Observer: Finally, please look at the potential of China’s development in the next five to ten years.
Ding Yifan: In the next five to ten years, our country will show a good state of sustainable development. The accumulation in sustainable development will be a world leader in the long run. Recently, our country has built photovoltaic power stations in northwest China, and the power generation capacity is dozens of times that of Three Gorges Hydropower Station, which means our trend of replacing traditional energy with renewable energy is becoming more and more obvious, and the pace of development is getting faster and faster, which is a great contribution of China to itself and to the world energy security.
One of the essentials of energy security is that we rely less and less on traditional energy sources and use renewable energy more and more fully, a change that gives our country greater energy security. Of course, during the transition period, we will do our best to diversify the types of energy we import and the settlement currency to ensure the secure development of Chinese energy during the transition period. If the U.S. blocks China’s energy supply lines, we should quickly establish energy trade with Russia, but of course we should not rely entirely on Russia and should be prepared with multiple hands.
Eventually, when we successfully pass the transition period and reach the goal of carbon neutrality, we will achieve energy autonomy in the true sense of the word. The achievement of this goal also relies on corresponding institutional arrangements, such as moving away from dollar settlement in finance, etc.