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Wang Zhan and Huang Renwei
hina
has only been carrying out its "reform and opening"
policy for twenty years. It has only trod the path
of the market economy for ten. The changes that have
swept China were unimaginable twenty years ago. The
changes to take place in the coming twenty years are
even harder to imagine.
In predicting the future one can't escape the question
of history. For 200 years, from the end of the eighteenth
century, China time and time again missed its historical
opportunities to modernize. The three industrial revolutions
of the West left China behind, until the Chinese nation
finally came to the brink of extinction. In the name
of their independence and freedom, people in China
looked to the West to learn about technology, social
and political systems, and culture, but nothing worked.
When we sum up the lessons of China's 200 years of
accumulated backwardness, the first is that China
lacked independence and autonomy in the world. The
second is that China lacked a system, and a spirit,
of innovation.
The real opportunity to learn from the West has come
to the Chinese people only in the last 20 years. "Reform
and Opening" and the socialist market economy—these
have opened for China a new pathway to innovativeness
in the Chinese system, in technology, and in culture.
What the most recent 20 years prove is that if China
wants to modernize, it must innovate, and that in
order to innovate, China cannot but learn from the
West. Modernization, innovation, and learning from
the West are neither separable from, nor contradictory
with, one another. If we want to make the nation strong,
if we want the two sides of the Taiwan Strait to be
united, first we must innovate—we must create the
new. We must continue to learn from the West. China's
people must say clearly to the world: China is already
taking the path of modernization, marketization, democratization,
and globalization. There is no turning back. We can
only advance. We cannot retreat.
 In
looking to the future, one likewise must not ignore
the circumstances of today. Simply put, what we are
embarked upon today is a kind of paying of overdue
bills incurred in the past. To achieve that, it is
not enough only to depend on learning from the West;
we also must walk a Chinese road to modernity. China
has 5,000 years of civilization behind it, but it
bears the historical burdens of overpopulation and
a deteriorating environment. The 1,200 years of increasing
population ever since the Tang Dynasty [618-906 AD]
created a wave of ecological exhaustion spreading
north and south from the Yellow River valley. The
Qing Dynasty [1644-1911] carried out a policy of exclusion
and isolation from the rest of the world, with the
result that the relatively high level of commercial
economy and foreign trade achieved by the preceding
Ming Dynasty [1368-1644] was smothered. In the first
30 years after the People's Republic of China was
founded, the sudden advances we made in economic construction
worsened the population, ecology, and resources problems
while the gap widened between China's and the world's
development. Today, China accounts for 8 percent of
the world's cultivated land but must sustain 22 percent
of the world's population. With only one-fifth of
the population of China, the United States enjoys
three times as much arable land, and its farmland
has only been under human cultivation for one-tenth
of the time that China's land has been worked.
China's historical burden is simply very difficult
for Americans to grasp. It is a heavy load, which
makes navigating China's ship through the seas of
history extremely difficult. To promote a ceaseless
improvement in the quality of life of the Chinese
through the basic processes of preserving the very
existence of the populace, distributing precious resources,
and restoring China's ecological environment—this
is what we of the present and future generations must
face.
Time and space determine the existence of any system
as well as the degree of freedom to reform any system.
To meet the basic challenges of living standards for
the world's largest population, in a highly constricted
space, means not only solving problems of clothing
and food, but having the power to improve the quality
of life: the power to receive a modern education,
for example, as well as information, health, housing,
entertainment, and so on. To this end, China must
all at once create a progressive model that weaves
together collectivism and individualism; melds efficiency
and equity; builds both law and democracy; and combines
reform at the top with change at the bottom.
China, after all, is not without its own proof of
the price of excessive "democracy." The ten years
of the Cultural Revolution are evidence of those unbearably
painful costs. And it is not as though China has never
explored turning power from central authority over
to local powerholders, either: the uncontrolled chaos
of the "Warlord Era" in the first part of the twentieth
century was a dark blot in our history. If China were
to return to "Big Democracy," as it was called during
the Cultural Revolution, or to warlord division of
our territory, an estimate of several hundred million
refugees on the move would be conservative.
Thus, to the people of China, the most persuasive
option is to take a gradual approach to the building
of our systems and to the orderly replacement of our
institutions. This is, moreover, China's commitment
to the people of the world. China's growth over the
past twenty years makes clear that our path has been
a rational choice for China in light of China's own
conditions. In the twenty years ahead, China will
continue to walk this pathway toward systemic development.
Urbanization, critical to changing the structure of
China's immense population, is the key to China's
modernization, its marketization, and its democratization.
We simply cannot conceive that a society in which
two-thirds of its population work as farmers, and
in which two-thirds of farmers live in villages with
people bearing the same family names, can be a society
with highly democratic politics. Nor can we imagine
that a China in which income and living standards
in city and countryside vary by huge orders of magnitude
can hope to retain a stable social structure. China
cannot hope to keep one part of its economy, in which
more than half of the labor force works as self-employed
farmers, fully integrated with the other part of the
economy that is more globalized. China's industrialization,
its modernization, and its internationalization will
all take shape according to the degree of China's
urbanization. The so-called "well-off society" [which,
since the recent 16th Party Congress, is on everyone's
lips,] must be seen for what it is: a society that
has fundamentally urbanized.
Thus in the twenty years ahead of us, the process
of urbanization will accelerate. The process will
radically change the model of economic growth and
individual consumption behavior in China and finally
alter the values and worldview of the Chinese people.
As urbanization proceeds, the Chinese economy will
once and for all move away from supply-dependent growth
and into a pattern of development pulled forward by
effective demand. The populace, driven above all by
the core urban consumer population, will create a
consumer economy with the greatest potential in the
world, its magnitude may reach several trillion US
dollars.
At the same time, a Chinese private capital market
dominated by an urban middle class will take form;
its size will dwarf the combined investment powers
of today's Chinese governmental and foreign investors.
 Urbanization
will bring with it the systematic development both
of transportation and information networks and will
make possible for the first time the orderly physical
movement of vast numbers of Chinese people within
the country. The household registration system, which
evolved in China over millennia, fixed the population
according to place, on the land. Urbanization will
decisively relegate this traditional system to history.
In China's most highly developed areas—the lower Yangzi
River delta, the Pearl River delta, and the Beijing-Tianjin-Bohai
region—we will see the emergence of three great "urban
spheres" whose 5 percent of China's total land area
and 20 percent of total national population will account
for 65 to 70 percent of China's total GDP in twenty
years. Drawn forward by these huge urban powerhouses,
central and western China will produce their own respectable
urban belts and concentrations of cities.
As half of China's population enters these highly
developed urban environments, large portions of China's
land and exhausted ecology can be allowed to rest
and recover, and the environmental debts incurred
over thousands of years can gradually begin to be
repaid.
As its structure is thus transformed from a peasant
core to an urban core, Chinese society will also move
in the direction of a democratic society.
The nature of the tasks bequeathed to China by its
development for the coming 20 years have already ordained
that China will pursue a foreign policy of peace.
China needs a stable international environment, including
both stable borders and stable global markets. All
international conditions that are favorable to stability
and economic development will be actively supported
by China, which will promote their constructive outcomes
to the fullest possible extent.
At the very least, to link China's strength with the
"China Threat," can be said to be ignorant of Chinese
psychology and culture. Admiral Zheng He, in the Ming
Dynasty, led what was at the time the largest fleet
the world had ever seen on voyage after voyage into
the Indian Ocean, but not once did his missions seize
an inch of territory. Today's Chinese people understand
even more clearly that China's development hinges
on world peace and world development—that China's
interests must help the interests of other countries,
and that its security cannot be achieved at the cost
of making other countries fearful. This is the meaning
of the twin Chinese concepts of "Common Interests"
and "The New Concept of Security," which will in coming
decades define China's international conduct and identity.
The more the Chinese economy advances, the greater
its dependence on the global market, and the greater
the importance of its cooperative integration with
the world's developed nations. China's commitment
to international regimes and international rules will
become even firmer in the decades to come.
In a similar way, a peaceful solution to the Taiwan
problem can only be found through the process of China's
own development. In recent years, the Chinese mainland
and Taiwan have become conspicuously economically
interdependent. The vertical industrial division of
labor between the two sides is being replaced by a
horizontal one. The movement of people has become
huge; in Shanghai and the lower Yangzi delta region
alone, several hundred thousand people from Taiwan
now make their long-term residence. Taiwan's massive
trade surplus with the mainland has already become
a key source of Taiwan's foreign exchange reserves.
If we imagine that the two sides will carry out their
"Three Links," we can see that the cost in time and
money of trade between the two sides will plummet.
According to World Trade Organization rules, Taiwan
must open its investment markets and real estate markets
to PRC investors; we can thus foresee large numbers
of mainlanders going to Taiwan for visits or for long-term
residence, and we can certainly envision much larger
numbers of students from Taiwan heading for the mainland
for academic degrees and training. The level of mutuality
between Taiwan and the mainland will come to far overshadow
the old relationship, with its characteristic preoccupation
with the "two sides of the Strait."
Thus Taiwan's future lies in economic integration
with the Chinese economy and in peaceful reunification.
Confrontation and conflict between the two sides does
not agree with the common interests of the people.
We can speculate that twenty years from now the Taiwan
Strait will not be a moat separating the people of
Taiwan and the mainland from one another. Instead,
airplanes may fly more frequently between Shanghai
and Taipei than between mainland cities. Unification
could happen by means we cannot even imagine at this
moment. This historic transition will be a mixture
of the gradual and the sudden.
We should not deny that in the next twenty years China
might face difficulties and challenges even greater
than those of the last twenty years. The increasing
diversification of interests within Chinese society
could reduce the ability of political authority to
control society. Divisions between rich and poor could
cause new conflicts pitting class against class. Popular
demands for greater political participation will ensue
as people's economic well being increases.
 All
of these will create pressures for reforms of China's
internal political structures and will, at the same
time, impel such changes. As cross-Strait economic
relations continue to deepen, failure to break the
political impasse between the two sides could trigger
a very serious crisis in the Strait. But such a crisis
could itself become the vehicle of China's unification.
The international political and economic influence
stemming from China's rapid growth may have the effect
of inducing deep changes in the pre-existing international
order. New trends may emerge in the relative distribution
of the world's markets and energy resources. The "status
quo powers" may turn out not to be so naturally able
to respond to these changes. China must learn the
rules of this fluid and changing game in order to
meet its international needs.
In short, economic and social transformation, dangers
in the Taiwan Strait, and all sorts of international
perils are the constant accompaniments to China's
forward progress. But numerous international strategic
thinkers have failed over and over again to see that
the breadth and depth of China's development far exceed
the constraints, and that in the course of China's
development to date all sorts of lurking dangers have
already been put to rest. This is why their predictions
about the "collapse of China" and the "China threat"
have missed the mark time and again. And Chinese strategists,
for their part, read these gloom and doom predictions,
take appropriate notice of the reasonable elements
in such analyses, and thus are better able to avert
strategic errors and frustrations.
What is needed is simply this: the uninterrupted continuity
of China's market opening; the uninterrupted reform
of China's basic systems; the Chinese people's continuing
and uninterrupted innovativeness; the inevitable continuing
progress and development of Chinese society; and the
inevitable increase in the benefits that the world
will draw from China's own improved fortunes.
That is the gift that China, over the next twenty
years, can offer to the world. 
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Wang
Zhan
is president, Shanghai WTO Affairs Consultation Center.
Huang Renwei
is director, Pudong Institute for the US Economy.
This article was translated and adapted from the Chinese. |
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| March-April
2003 THE CHINA BUSINESS REVIEW |
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Copyright 1997-2008
by The China Business Review
All rights reserved.
Last Updated:
07-Mar-2003
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