杂志汇中国与非洲

China’s success in attaining smarter growth will benefit the global economy

China’s successful economic transition will set an important example in the ongoing rebalancing of the global economy and changing global economic landscape.

Although China’s economic growth has

slowed down, it remains an important growth engine for the world economy and still has huge potential. Based on growth mode transformation and restructuring, China, together with other Asian countries and emerging economies, will be an important participant in the reform of global economic governance.

Beijing has taken proactive measures to enhance the international financial system by constructing new multilateral financial systems such as the Asian Infrastructure Investment Bank, the New Development Bank, and the Silk Road Fund. It is also seeking to gain stronger power of discourse commensurate with its economic strength to foster a new pattern of global governance.

Windows to China

More and more high-level forums held in China have become very good platforms for foreign political and business leaders, think-tank scholars and market players to understand China’s economy. The Boao Forum for Asia, for example, serves as an important window for the world to better understand China and Asia, and is expanding its influence year by year. This year, it focused on “Asia’s New Future: New Dynamics, New Vision.” The China Development Forum 2016, held in March, also opened a new window to understand China’s policies.

Some critics have pointed out that China currently faces three major economic challenges: how to transform its mode of growth, how to control a potential slowdown in its economic growth, and how to dock its economic strategies with the world’s. The task is to ensure economic transformation and growth in the context of the global economic competition and transition in international patterns.

China’s economic transition is unique in the history of the global economy. There is a significant difference in China’s economic structure today from those of industrialized countries such as the United States and Japan during their transition period. In addition, China’s endowments, population structure, economic development concept, decision-making mechanisms as well as technological development level are different from those of the industrialized countries. Therefore, no ready-made models are available for China’s economic transformation. China may not learn many lessons from Japan’s economic transformation because of the huge differences between their national conditions. Yet it is worthwhile for Chinese policymakers and market players to consider lessons from the economic bubble burst in Japan and its aftermath.

China’s successful economic transition will set an important example in the ongoing rebalancing of the global economy and the changing global economic landscape.

First, China’s economic transformation and its international influence have won the attention of a flock of famous economists, such as Nobel laureates Joseph Stiglitz and Edmund S. Phelps, who would like to do research into the internal logic of China’s economic transformation.

The economic transformation has also drawn increasing concern from global leading think tanks such as the Peterson Institute for International Economics and Brookings Institution. Some financial leaders and market players have also offered professional consulting services for China’s 13th Five-Year Plan (2016-20). It is not only a new proposition for mainstream economics but also an important case study for analyzing economic reform in developing countries. It thus enriches the study of international economics and may lead to new conclusions that could change general economic concepts.

Second, not only will China’s economic transformation provide a new impetus for the world’s economic recovery and growth but also play a key role in driving the economic growth of neighboring countries, especially those along the Belt and Road Initiative routes, and bring further incremental investment for the United States, Europe, Latin America and the South Pacific. 

Development dividends

The ongoing China-U.S. Bilateral Investment Treaty negotiations and other trade and investment facilita-tion measures will ease China’s high-quality capacity transfer abroad, while pressing ahead with structural reforms internally. China’s huge domestic market and strong purchasing power will also create new market opportunities for its trading partners. These tangible development dividends are undoubtedly conducive to global economic recovery and growth.

China’s economic restructuring will inject new vitality into the reform of global economic governance. Global financial public goods have been hindered by insufficient supply due to the economic decline of developed countries. On the other hand, global economic imbalances and lack of governance are known to be threats to sustained growth in the world economy.

The world is now confronted with an apparent supply-and-demand contradiction of global financial public goods. This has come in the wake of the acceleration of economic globalization, Internet financing boom, frequent regional financial crises, absence of regional and even global economic coordination mechanisms as well as growing investment needs in developing countries.

If it achieves success in continuous economic restructuring, a vibrant China will undoubtedly play a more important and active role in building global financial public goods as well as capacity. CA

 (The author is an economics professor and dean at the School of Economics and Finance, Shanghai International Studies University)