By Mohammad Mazhari

China’s economic rise presents an alternative to Western model: researcher

August 2, 2021 - 16:57

TEHRAN – A researcher on the China program at the Institute of Regional Studies in Islamabad says that the People’s Republic of China could successfully present an alternative model for Western one.

“The Chinese development path and governance presents an alternative model to the Western democratic system,” Nabila Jaffar tells the Tehran Times.

“China’s rise can be attributed to its socialist values and democratic ideals,” Jaffar adds.

While Western countries blame China for being a one-party system, the Pakistani analyst notes that “China developed a system that is democracy at the bottom, experimentation in the middle, and meritocracy at the top.”

According to Jaffar, “China’s development path is not only remarkable but is also very encouraging and inclusive for the region.”

Following is the text of the interview:

Q: How do China's neighbors see Beijing's economic rise? How could China reach such a level of development?

China’s development path is not only remarkable but is also very encouraging and inclusive for the region. China’s rise can be attributed to its socialist values and democratic ideals. People’s Republic of China (PRC) became a socialist republic ruled by One Party “the Communist Party of China” after it was founded on 1 October 1949. 

China developed a system that is democracy at the bottom, experimentation in the middle, and meritocracy at the top. This system produced leadership of the level which is unprecedented in history. 

History has reckoned China as a major contributor to global GDP for centuries but in 1950 China’s GDP stood at 5 percent share in the world. After Opium Wars in the 18th century, China’s economy was severely affected and it turned out to be a poor country. But the Chinese are resolute people. Through resilience, hard work, consistency, pragmatic approach and reforms the CPC leadership put the country on the continued development course. According to a veteran expert on China in Pakistan Ambassador Syed Hassan Javed, China was facing many challenges when Deng Xiaoping was contemplating economic reforms but China knew how to convert challenges to opportunities. 

China experienced unprecedented growth in its economy after premier Deng Xiaoping opened up to foreign trade and investment by implementing free-market reforms in 1979. China also turned the opportunity of membership in WTO to its advantage. China learned from the best practices of other economies and also embarked on technological up-gradation. China won the title of the second-largest economy in 2014 with GDP growth averaged nearly 10 percent over the span of more than a decade. The fast and sustained development of China shows the advantages of the consistent policies of the one-party system.  

The success of these models is manifested in China’s capability to bring out millions of its people from poverty. The development in all fields including economy, science and technology has landed China in a powerful position. China has become the global engine of growth. Its expanding economic partnership in the world has also given it political leverage in global affairs.

 The Chinese development path and governance presents an alternative model to the Western democratic system. The Chinese model of governance unlike the Western democratic process follows merit in the selection of the leader. It shows that there could be another system with successful outcomes other than the Western democracy. The world can learn from the democracy at the grass-root level and socialist formula for the equal development of all regions in China. China’s central government focuses more on the least developed provinces. The surplus resources of the developed provinces are diverted to the development of the poor provinces. China considers this economic rise as the revival of its past. 

Q: What opportunities can China provide for Asian countries?

A: China’s economic rise offered tremendous opportunities to the neighboring countries. China’s vision for the community of a shared future for mankind and shared destiny is a driving force behind inclusive development in the region. 
China’s Belt and Road Initiative (BRI) covers the entire Asian continent through its six corridors focused on connectivity networks, infrastructure, energy and industrial zones which will also lift the economies of the partner countries. China is not only the biggest trading partner of many countries in the region especially the ASEAN region, but the BRI initiative is giving the opportunities to host both manufacture activities in addition to trade and transit through the corridors connecting land routes with the sea routes. 
China Pakistan Economic Corridor (CPEC) is considered a game-changer project for Pakistan’s economic development. The first phase of CPEC has yielded beneficial results for the country by investing in energy and infrastructure projects. Pakistan was facing acute electricity shortages. 
But now our national grid is catering to the electricity needs through the addition of new power plants with the help of China’s investment under CPEC. Similarly, China also decreased the reliance of small neighbors in South Asia on India. All the small South Asian countries have become partners in China’s infrastructural development projects. Besides that, China’s $400 billion deal with Iran also includes Iran in the BRI drive for regional development through trade and energy connectivity. Such kinds of opportunities are also bringing major geopolitical shifts in the region. 

Q:  How do you evaluate the U.S.-China trade row? Is the U.S. capable of containing China?

A: Despite waging a trade war with China, the U.S. trade deficit with China is still high. Even after the Phase One deal in January 2020 to address the trade deficit, the implementation process remained slow because of the Covid pandemic. China could not achieve the target of purchasing $200 billion of goods from the U.S. The new administration of the U.S. is also determined to address the trade deficit problem while maintaining high tariffs on imports from China. The U.S. will maintain pressure through increasing tariffs and also banning China’s high-tech but it cannot decouple the economy from China in near future. 

China is also a leader in the production of rare-earth metals which are not abundant in the world. The U.S. had stopped production of rare earth metals in 2002 because it could not catch up with China and also due to environmental degradation. Since then, the U.S. has been dependent on importing rare earth metals and semiconductors for its electronics. China was responsible for 80 percent of rare earth export to the U.S. in 2019 which decreased due to Covid in 2020. When the trade war escalated between the two countries, China also threatened to block the rare earth export to the U.S. China can cause consumer costs in the U.S. if it weaponizes the metals. 

The U.S. has accelerated efforts to revive its indigenous production of rare earth minerals to decrease its dependence on China. In 2019, when the trade war escalated, the U.S. inflicted a 25 percent increase in tariffs on $ 250 billion on China’s exports to the U.S., in retaliation China could only increase 25 percent tariffs on 110 billion imports from the U.S. because of the trade deficit between the two countries. 

Despite this huge difference in the tariffs increase on China’s goods given its larger volume in trade with the U.S., the trade war has not hurt China’s economy. Compared to the year 2019, pandemic affected the U.S. foreign trade of goods by shrinking it to 8.8 percent in 2020 with total trade of $3.84 trillion. On the other hand, despite the pandemic, China's foreign trade volume increased to $4.65 trillion which makes it the number 1 trader in the world.

China’s economy has reached maturity. China had become the biggest manufacture in the world in 2010. China adopted new economic measures in 2015 to avoid the middle-income trap in 2015. It introduced innovations in its economy to increase domestic consumptions and decreasing its dependence on fixed market investments. The U.S. attempts could not hurt China much because China is also doing great in trade with other global partners. For instance, the ASEAN countries the trade volumes with China were 4.74 trillion yuan ($731.9 billion) in 2020 by making it the number one trading bloc of China with a 7 percent growth every year. 

Q: Do you think China can lead the global economy in the near future? Don’t you expect emerging Asian powers, like India and Turkey, to form a coalition with China?
   
A: With the U.S. protectionist policies under the Trump presidency, China’s economic influence further expanded. China has become the leader of the new phase of globalization and a firm supporter of the open market system. China is expanding its soft power by promoting new norms against the zero-sum politics of the U.S. 

This changing scenario has created opportunities for China to adopt a leadership role with its distinct ideology and norms, especially in the Asian continent. Although the U.S. is warning other countries against the debt trap China’s win-win cooperation strategy has an increasing potential to attract more partners. China, apart from its governance and economic model, is also introducing new norms in the Western-led global order. By globalizing its economic policies, China is also reaching out to the world politically which opens new avenues for cooperation on international security. China can use its increasing influence to the advantage of the global community. China is also advocating for reforms in international systems to adhere to the democratic rules-based world. China is against unilateralism in the international system and it wants to promote a new type of international relations with its vision of development and prosperity for the shared future of mankind. 

Given the present scenario in which India is economically entangled with China but in the military, political and strategic terms, it has embraced the U.S., it cannot be determined that in near future India can make a coalition with China. The relations between China and India are complex. Economically they will not be able to decouple soon. India cannot catch up with China economically in near future but it will continue feeling threatened by China due to China’s economic encirclement in the entire South Asian and East Asia region. In terms of cost-benefit analysis, India can gain more for its domestic economic growth if it becomes a partner to China’s BRI drive in the region. But it depends on the strategic course India maintains as an ally in the U.S.-led Quad and the U.S. Indo-Pacific Strategy against China. 
Turkey is also emerging as a relevant and great power. Its role in the Middle East (West Asia) and global affairs is visible. China and Turkey might find common grounds for greater cooperation against unilateralism and democratic global order. Both countries also have the potential of increasing economic and strategic relations. China’s rise is facilitating a paradigm shift in the political preferences of many countries. Greater relations with China will neutralize Turkey’s only aspiration of becoming part of the European Union. Turkey’s alignment with China will strengthen both countries. China’s rise is also providing an opportunity for Muslim countries to redefine their role and status in the world. 

Q: How do you assess the 25-year Iran-China partnership? Can it curb the U.S. sanctions? 

China through its BRI not only expanded and diverted trade channels but China also wants an unhindered energy supply to its growing economy. The 25-year Iran-China partnership is a win-win for both countries. The $ 400 billion investment in oil purchase from Iran will ease Iran’s international isolation and redefine its global status. It is a positive development that is the manifestation of China’s vision for a new type of international relations. This accord is the result of the shared bilateral and multilateral interests of China and Iran. 

The U.S. is easing trade restrictions on Iran to get it on board once again on JCPOA. The U.S. changing behavior to Iran is the outcome of the U.S. new administration’s belief in receiving assurances on Iran’s nuclear program through upholding the JCPOA. However, the ease in sanctions is also aimed to keep Iran engaged on the Middle Eastern (West Asian) issues. Although the U.S. administration showed concerns over the accord between China and Iran and it also announced to impose costs on Chinese companies. But despite the U.S. ability to impose costs on China’s business with Iran, China has the potential to defy the U.S. pressures to go ahead with the agreed partnership with Iran. 


 

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