What other countries can learn from reform and opening-up

By Ei Sun Oh Source:Global Times Published: 2018/8/8 20:33:40

Lessons from China’s reform and opening-up

This year marks the 40th anniversary of the implementation of China's reform and opening-up policy, which has had profound socioeconomic implications not only domestically, but also beyond China's borders.

At the onset of the historic decision to overhaul and unshackle the country's economic system that had just experienced more than a decade of turmoil, China still ranked low among developing countries. Today, China has become the second largest economy, and simultaneously the envy and model for many nations around the world, practicing its own strand of socialism with Chinese characteristics.

There are indeed many lessons to be drawn, especially by developing countries from this momentous phase of modern China's development.

The first lesson that aspiring nations should learn from China's reform and opening-up policy has to do with the attitude of both the national leadership and the people at large. Former and current senior Chinese leaders have been very resolute in pushing through the unprecedented policy, often in the face of adversity, such as opposition from certain reactionary elements who would prefer the old, ossified ways of going about socioeconomic issues.

The transformation of often gigantic State-owned enterprises (SOEs) is but one such example. On the other hand, the private sector and civil society in China have also caught on with the "open" socioeconomic trend and been assiduous in cultivating China's own market economy, such that many of them have improved their fortune tremendously over the last four decades or even less.

The policy would not have worked as miraculously, if only the senior leadership were enthusiastic about it while the people did not receive it well, or if the people craved for reform but the powers that be were not as responsive. It is this combined, positive attitude of official determination coupled with popular proactive entrepreneurial spirit that is perhaps the fundamental secret "ingredient" for the success of China's reform and opening-up policy. 

The second lesson that one should take to heart is that the reform and opening-up of China's economy is not an end in itself but a means to an end and a continuous process, albeit to be improved upon along the way.

At the beginning, when China's economy was still largely collective in nature, budding businesspersons had some leeway to set up "individual enterprises," producing and marketing goods and services that were beyond the reach of SOEs. Gradually, a socialist market economy took shape, admittedly with bumps along the way, and unleashed the erstwhile untapped business potential of the private sector.

Today, many Chinese conglomerates in both the public and private sectors are listed for trading in not only Chinese domestic stock markets but also overseas bourses, after honing their business skills in highly competitive settings.

The Chinese characterized this long, winding path toward economic accomplishment as "crossing the river by touching the stones," and the "river" is indeed a very wide one, for even today China is still embarking on a journey of deepening and broadening its reform and opening-up.

And a third lesson from China's reform and opening-up has to do with a balance between the need for rapid development and environmental preservation. At the onset, China had to pick up its pace for economic development as its economic potentials were in a sense unbridled by reform and opening-up. Factories and buildings were erected at a fast pace, producing goods and providing housing for a growing population, often at steep costs to the environment.

But in recent years, China has acknowledged that environmental degradation and climate change are unpleasant facts that must be countered by itself and the world, and it undertook to ameliorate the toll on the environment by switching to "green" industries and livelihoods.

Today China is the world's largest producer and user of many forms of green energy from solar to wind. Bike rentals are the craze in China's urban areas and beyond. China and the world have come to realize that for economic development to be sustainable, it must be balanced with efforts at preserving the environment.

And last but not least, China's reform and opening-up process, as the name suggests, has been an interactive one with the rest of the developing and developed world. When China opened its doors, businesses from countries ranging from the United States to Malaysia rushed in to invest, creating job opportunities for many Chinese workers.

And now that China has become more well-to-do, it has been undertaking various overseas investments under the aegis of the Belt and Road initiative, exploring new business opportunities. This sort of "prosper thy neighbor" mind-set is crucial for China and friendly nations to achieve mutually beneficial economic circumstances.

China's reform and opening-up policy required firm attitude from both the leadership and the people, constant improvement in the process, a fine balance between development and environment, as well as interactions with the rest of the world to arrive at its present pinnacle, and would hopefully provide useful lessons for all.

The author is Principal Adviser, Pacific Research Center, Malaysia. opinion@globaltimes.com.cn

Newspaper headline: Lessons from China’s reform and opening-up

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