Tackling thorny issues facing China’s development in coming year

Source:Global Times Published: 2013-1-17 19:48:01

 

Hu Shuli & Wang Shuo, China 2013: What Matters Most, Thread-Binding Books Publishing House, January 1, 2013
Hu Shuli & Wang Shuo, China 2013: What Matters Most, Thread-Binding Books Publishing House, January 1, 2013



The year 2012 is over and a new year has just begun. A lot of changes have happened in the past year. What will the next year be like under the new Chinese leadership? What are the key problems of 2013? And how should we deal with them?

China 2013: What Matters Most, published by Thread-Binding Books Publishing House on the first day of this new year, tries to answer these questions.

The book, compiled and edited by Hu Shuli and Wang Shuo, was collaboratively written by a number of renowned scholars in China such as Wu Jinglian, professor of economics at the China Europe International Business School, Xu Xiaonian, senior research fellow of economics at the Developmental Research Center of the State Council, and Chen Zhiwu, professor of finance at Yale University.

The book speculates that China's economy will make significant adjustments in 2013. Scholars tackle topics including national income, judicial reform, tax and land transfers, which are all major issues related to civil livelihood.

Since the reform and opening-up in 1978, China has seen outstanding achievements in its economy. China's GDP only accounted for 4 percent of global GDP in 1980. This increased to 16 percent in 2006. In 1980, our per capita GDP was two-thirds of India's while between 2008 to 2012 it was almost double, according to the World Bank.

However, behind these achievements, we should also understand that a number of structural problems exist. Generally, the rise in people's incomes lags far behind the increase in GDP. There are many important fields which are not open to market competition.

Employees of SOEs enjoy much higher salaries than others. Due to the lack of freedom of movement and other restrictions, there are many migrant workers who have limited employment options. The gap between these two groups of people is increasing.

Also, many hard-working Chinese people are not seeing rising prosperity. Some workers' rights have been curbed to maintain low labor costs, which will create a situation where the country becomes rich while many of its people stay poor.

The expanding wealth gap and structural problems have resulted in mass incidents. Facing such a situation, the book holds that we should first deal with the problem of balance and expression of interests. More than 80 percent of conflicts in China are caused by contradictions of interests.

Despite the sheer number of problems, the book believes that China is still in a stable situation. However, such stability is rigid and is based on the power of the State and contains dangers. We have to add more flexibility into this rigid stability, so as to make it more sustainable.

China today is very complex. Those questions cannot all be answered accurately. Nonetheless, the book provides the authors' own value judgments to help us better understand the development of China in 2013.



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