Chinese Model Of Development: Some Reflections

By Liladhar Upadhyaya, While visiting China, everybody wonders and asks questions about the rapid development and growth made by the country within a short period of time. The answer they get is political stability, hardworking and disciplined people, patriotic feeling of the citizens and use of advanced technology. China's growth, ranging from economy to infrastructure, is amazing. Chinese government and people first introduce plans or set target, and lead the nation and its people to reach the destination and they have become successful. Continuous review of their works and rectifying the mistakes is another key to the achievement. That is way China has incorporated strategic goals and missions under the 13th five-year national plan (2016-2020).

The Chinese 13th five-year national plan was discussed and passed in the Chinese People's Political Consultative Conference and the National People's Congress in March 2016. "It is the last five-year plan for the country to complete the construction of a moderately prosperous society in all respects by 2020 and for achieving decisive results in deepening reforms," said Premier Li Keqiang, who presided over the meeting.

The 13th plan proposal reveals the ambition of creating a 'moderately prosperous society', by doubling the GDP per capita by 2020 compared to 2010 levels, in celebration of the 100th anniversary of the Communist Party of China found in 1921.

China's old model of economic growth is out of steam, and the new normal phase of development is making shift from investment to consumption-led growth. This means finding new drivers of growth by promoting innovation and entrepreneurship, while simultaneously creating an environment conducive to producing Chinese national champions, said Dr. Xuezhu Bai clarifying the goals of the 13th five-year plan. Dr. Bai is the Head of International Teaching at the China Executive Leadership Academy, Pudong (CALAP).

The plan has set five-in-one development strategy underpinning the policies for China's future. First, innovation: As a driver of economic development and to shift China's economic structure into higher-quality growth pattern. Second, open: Utilize both domestic and global markets and be more active in global governance. Third, green: Develop environment technology industry, as well as ecological living and ecological culture. Fourth, balance: To ensure balanced development among rural and urban areas and across different industries is also emphasized. And, fifth, inclusive: Bridge the welfare gaps between countryside and cities by distributing and managing resources more efficiently, so as to bridge the existing welfare gaps.    

Regarding economic growth, the plan has GDP target of 6.5 per cent; double GDP and per capita income by 2020 from 2010 base. China's per capita disposable income will come to 30,000 Yuan ($ 4,600) by 2020, catching up with upper-middle income countries. The plan has a target of building world-class clusters in Beijing-Tianjin-Hebei region, Yangtze River Delta and Pearl River Delta.

According to the 13th five-year plan, the roadmap for the nation's development from 2016 to 2020, more than 50 million new jobs will be created in urban areas - an increase of five million compared with 12th five-year plan. China's high-speed railways will extend to 30,000 kilometers by 2020, covering more than 80 percent areas. 

Under domestic industrial upgrading scheme, the plan has a target of transforming China from a big industrial country into powerful industrial country with internet plus and others. Mobile broadband coverage will grow to 85 per cent by 2020. For that, they say 'everyone is an entrepreneur' and 'creativity of the masses' is important.

Another key component of the plan is belt and road construction. It aims at quickening belt and road construction and expanding win-win cooperation to form a new comprehensive opening up landscape. It has a plan to strengthen cooperation with international financial institutions, push forward the Asian Infrastructure Investment Bank and the BRICS new development bank, and properly operate the Silk Road Fund.

Under social welfare scheme, they plan to extend coverage of urban welfare services to all residents; universal enrolment in retirement and critical illness healthcare plans and to lift over 70 million people out of poverty by 2020.          

Chinese territory is so vast, the population is so large and the conditions are so complex that it is far better to have the initiatives come from both the central and the local authorities than from one. One of the most important aspects of good governance in China is maintaining a balance between the central and local governments. China has made a variety of reforms on the central and local government relationship, which gave the local government enormous incentives to develop the economy. Through negotiations, the central and local governments set up a fixed percentage of turning over to the state, which will not be changed in five years. Under this model, the more fiscal income the province gets, the more it would turn over to the central government.

Citing the idea of researcher John Naisbitt, Dr. Jiang Junjie of CLAP said, China was not only undergoing fundamental changes but also creating an entirely new social and economic model -what Naisbit calls a 'vertical democracy.' Vertical democracy is changing the rules of global trade and challenging western democracy as the only acceptable form of governing. Western political system is 'horizontal democracy' in which everybody has equal status and there will be election in every few years. Somebody votes and others voted in.

In China's vertical democracy, there are leaders at the top and there are people at the bottom. The leaders may command, but people can make proposals too, Dr. Jiang said. Within this system, sometimes, the leaders are more important, while at other times the people are more important, depending on different situations. It continues to change, being both top-down and bottom-up.  Naisbitt said, it poses a challenge to the model of the West. "Western model was regarded as the only one in the world in the past, but now there is another model, and it is highly effective one."

For example, the economic reform initiated by Deng Xiaoping in 1978 actually started from 18 rural families. They abandoned the collective commune mechanism and worked on their own individual lands, which was dangerously illegal back then. But they gained support from local government, and when Deng heard about it, it changed the agricultural policy of all of China. This is a typical example of 'bottom-up', and this approach has become more and more important in China. 

So far as structure is concerned, from the central government, to the provinces, prefectures, counties and townships, they almost share similar structures. Except that diplomatic, national defense and a few other functions are held exclusively by the central government; the structures and the functions of local governments are almost replicated from the central government.  

The motto of Chinese model is to serve the people wholeheartedly, means serving the people in need putting aside personal interest or with the feeling of sacrifice. This theory and practice is more applicable to the members of the Communist Party of China. "Recent evidence is that we sent doctors to the Zika virus affected countries to rescue the affected people without caring for our lives," said Dr. Jiang Haishan of CELAP   

The Chinese dream is to achieve the great rejuvenation of the Chinese nation, to achieve national prosperity and revitalization and people's happiness. They want to explore socialism with Chinese characteristics learning lesions from other socialist countries like the Soviet Union until the 1980s. They want to emancipate mind, seeking truth from facts, and proceed from reality. "We regard practice as the criterion for truth and do not blindly believe in books; do not blindly stick to conventions. White cat or black cat, as long as it catches mice, it is a good cat," said Dr. Jiang. "So liberating and developing productive forces is the fundamental task of socialism with Chinese characteristics. Hence, adhering to the principle of taking economic development is the main task," he said.  China has managed 95 per cent self supply of food. Chinese believe that development tells everything and nothing without development.

However, economic growth over-dependent on export and fixed investment, disparity between urban and rural lives, disparity between different regions and people, energy and resource constraints are some challenges in China. Dr. Bai said that combating corruption was another challenge in China. China has strict rules and former vice-chairman of the standing committee of the National People's Congress and vice-governors of Jiangxi and Anhui provinces, etc, were sentenced to death as they were found guilty on charge of corruption. Maintaining clean environment is another problem in China, Dr. Bai said. According to a UN report, out of 20 most polluted cities, 16 are in China, he said.

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