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Secret to wealth and success

Secret to wealth and success

For rising nations with extensive expertise and insight into how to face the obstacles of economic growth, China’s successful economic reform offers a wealth of lessons. China has benefited the most from globalisation and has been the nation that has done so despite the current financial crisis. Over the course of more than 20 years of extraordinary success, a tremendous transformation has taken place in every element of the Chinese economy and society. China is one of the fastest-growing economies in the world and has achieved remarkable progress over the past few decades its leadership played an instrumental role in transforming China from a low performer to an economic hub so, the credit totally goes to the leadership and its policies.

China’s economy has grown significantly in recent years, becoming the second-largest globally. Under President Xi Jinping’s leadership, China prioritises economic development, focusing on industrialisation, innovation, and international commerce. The country has invested heavily in infrastructure, technology, and human capital development, and has emphasised the importance of the China-Pakistan Economic Corridor and the Belt and Road Initiative. Despite challenges like a faltering economy, trade conflicts, and the Covid-19 pandemic, China continues to pursue sustainable growth.

Role of President Xi Jinping

China’s economic growth since 1978 has been impressive, with GDP expanding at an average pace of 6.8 per cent annually. Since Xi Jinping’s presidency in 2013, China has implemented measures to maintain its growth, focusing on long-term planning, reform, and innovation. Xi’s anti-corruption efforts have encouraged economic development, boosting investment and entrepreneurship. He has also emphasised infrastructure spending, such as the Belt and Road Initiative (BRI), which links China with markets in Asia, Africa, and Europe. Xi’s core leadership tenets include encouraging innovation, developing a knowledge-based economy, and promoting long-term planning and experimentation.

China, the world’s largest industrial nation today, is driving global economic expansion through market liberalisation, justice, equity, inclusivity, partnerships, and sustainable growth. The Belt and Road Initiative (BRI) has promoted shared development, particularly for poor nations, leading to a 20.2 per cent global FDI share in 2020. Investments focus on services and technology.

China is currently the largest producer and consumer of commodities worldwide, including those related to energy, machinery, electronics, apparel, footwear, and home appliances. More than 200 industrial products are produced and exported by it more than any other country. It produces 60 per cent of the world’s power generation equipment, 70 per cent of mobile phones, and 30 per cent of computers.

The dedication to reform and opening up has been another important component of Xi’s leadership. Xi has adopted various initiatives to open the economy, reduce red tape, and enhance the business climate. This has involved simplifying administrative processes, removing red tape, and lowering business taxes and fees. Along with these measures, Xi has also prioritised the policies of reducing poverty by lifting its population from a vicious cycle to a virtuous circle. This has encompassed a variety of programmes, such as providing targeted aid to underdeveloped areas, building rural infrastructure, and encouraging rural entrepreneurship and innovation.

An emphasis on innovation, long-term planning, and a dedication to reform have distinguished Xi’s leadership style. Xi has positioned China as a global economic superpower while fostering sustained economic growth and development in China by placing a high priority on these essential factors.

Poverty alleviation: A key component of economic development

China’s President Xi Jinping has implemented a “Targeted Poverty Alleviation” initiative, aiming to lift all Chinese people out of poverty by 2020. This initiative focuses on infrastructure development, healthcare, and education in underdeveloped areas. Since its inception, China has seen a 90 per cent decline in poverty, with the number of people living in poverty decreasing from 98.99 million in 2012 to 5.51 million in 2020. China has also focused on rural infrastructure development, promoting small enterprises and startups in rural areas. Since 1978, China has lifted over 850 million people out of poverty, establishing itself as a global economic power. The government has made the business climate more conducive to investment, addressing issues like economic disparity and environmental degradation. The current leadership prioritizes innovation and technical development to create a knowledge-based economy, addressing challenges in research, development, and technology.

The case of CPEC and BRI

The China-Pakistan Economic Corridor (CPEC) is a significant infrastructure initiative aimed at connecting China with other nations in Asia, Africa, and Europe. The project, which includes infrastructure in Pakistan, aims to increase commerce between the two nations and generate new economic prospects. The BRI and CPEC have been cited as examples of how strong leadership can promote economic growth by constructing infrastructure. China’s leaders have made significant investments in infrastructure development, opening up new trade and investment opportunities, forging new alliances with emerging nations, and providing employment opportunities for governments. However, concerns have been raised about the potential impact on the economic and political stability of participating nations.

Critics argue that China’s involvement may threaten local sovereignty and democratic government, but the BRI and CPEC have successfully encouraged and welcomed economic integration and connectivity, serving as win-win situations for all nations.

Importance of education

China’s economy has been significantly impacted by education and vocational training. Investment in education has led to a highly trained workforce, fostering knowledge-intensive and high-tech companies. This has increased production and efficiency across various sectors. Education has also fostered a culture of entrepreneurship and innovation, creating a large talent pool for technology and innovation. Vocational education has also helped fill labour market skills shortages, reducing unemployment and production by equipping employees with the necessary skills for specific occupations.

Contribution of Blue Economy

China’s economy is viewed as an interdependent Blue Economy, with its trade policy changing between 2001 and 2010. As the second-largest economy globally, China prioritises sustainable growth. Commerce with other nations accounts for 70 per cent of China’s GDP. China’s vast coastline, 7,300 islands, sovereignty over the continental shelf, and maritime resources make blue/maritime trade a crucial aspect of its international trade. China’s maritime oil reserves and natural gas reserves contribute to its economic growth.

Examples for other nations on economic model

Over the last several decades, China’s economic development model has effectively fostered sustained economic growth and development. Other nations may take several lessons from China’s example.

Other nations seeking to promote sustainable economic growth and development may learn valuable lessons from China’s economic development model. Countries may provide the prerequisites for long-term economic success by concentrating on infrastructure development, innovation, a hospitable business climate, targeted poverty reduction, and international collaboration.

Future Outlook for China’s Economic Growth and Development

Despite significant obstacles and uncertainties, China’s economic growth and development forecast is still favorable. Several important variables that will affect China’s economic development in the upcoming years are listed below:

China’s economic future is bright despite obstacles, as its leadership is focused on removing obstacles and promoting economic reforms, technical innovation, and self-reliance. China’s rise has sparked global interest since the collapse of the Soviet Union, with a focus on expanding regional and international influence, encouraging global growth, and maintaining a stable international order. China’s policies, which have transformed it from an agricultural economy to a global industrial hub and digital leader, can serve as a model for developing nations, especially BRI member countries, to achieve their national objectives and sustainable development agendas.

The Author is MD IRP/ Faculty Dept. of H&SS, Bahria University Karachi

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