What is happening in China under Xi Jinping? Part III

By | October 23, 2021

Popular dissatisfaction in China as a result of deteriorating air quality has become more intrusive after several serious smog alarms in many Chinese cities: In January 2013, air quality reached very high and dangerous levels for particle density «PM 2.5». These particles penetrate the lungs and bloodstream and are very small – less than 2.5 micrometers (1 micrometer = one thousandth of a mm) in diameter. The worrying situation gave rise to an exchange of words on the internet where there was talk of ” airpocalypse ” (cf. apocalypse) in the coastal provinces (the most industrialized). Environmental problems have been given top priority by the Xi government, including the development of a “ green GDP». This means that the negative effects of Chinese growth – damage to people and the economy caused by polluting emissions – will be included in GDP measurements. In addition, the Party decided in 2013 to spend NOK 17,000 billion on measures to improve the environment.

In less than three years, according to SOURCEMAKEUP.COM, the political landscape in China has been greatly reshaped by the Xi Jinping regime . However, there is great agreement both inside and outside China that a lot of work remains and that there are plenty of risk factors in the time to come. The direction of Chinese political and socio-economic developments will affect not only China but also large parts of the international community.


Some main explanations for the growth in China

In many ways, economic growth in China in recent decades has been impressive. Then it is easy to forget that the economic reforms in the country have not yet been fully effective. The Chinese economy is the result of large-scale reforms adopted in the late 1970s to repair all that had been destroyed in the Mao era. Mao’s successor, Deng Xiaoping, initiated reforms such as …

  • changed the extensive agriculture and streamlined production there
  • opened for more private participation in the economy
  • stimulated the growth of small and medium-sized enterprises
  • provided expanded management opportunities to state-owned companies,which improved the profitability of these and liberalized price formation

In addition, the country was able to draw on its large, well-educated workforce and the country opened up more to imports and direct investments from foreign investors, including in joint ventures with Chinese.

  • Undoubtedly, favorable access to Western markets in North America and Europe in particular has made a strong contribution to promoting Chinese exports. Many describe Chinese growth as strongly export-driven, and the country has become more integrated into the world economy.
  • China has largely used the persistent and high export revenues for savings and investments. China has long had a much higher rate of savings and investmentthan most other countries.

In the 1990s, governments began to encourage Chinese companies to go out into the world and to global branding . The relationship between the state and large companies in China drew a lot of inspiration from Japanese and South Korean models. The government promoted competition between the companies, but at the same time maintained strong ties between itself (the state) and large Chinese multi-national companies.

Slowly up the technology ladder

The Chinese economy continues to be dominated by the production of fairly simple industrial goods . In recent years, however, the Chinese government has sought to promote the development of high-tech, more advanced goods. This means, among other things, computers, mobile phones and environmental technology such as solar panels and other “green” goods.

However, the development of Chinese high-tech brands that can compete in global markets is slow compared to what other countries in East Asia are achieving. Chinese high-tech companies include the PC manufacturer Lenovo , which got a boost after they bought the PC manufacturing from IBM in 2005, and then the acquisition of the mobile part of Motorola in 2014, as well as Huawei, which manufactures equipment for telecommunications.

A Chinese mobile phone company, Xiaomi , has prepared to enter the global market after great progress in the domestic market in competition with Apple and Samsung. Today, nearly half of all solar panels in the world are manufactured in China, led by companies such as China Sunergy and Yingli . However, the leap to global markets for many other Chinese technology companies remains.

Green economy

The United Nations Environment Program, UNEP, defines the green economy as “An economy that results in increased human well-being and equitable distribution, while significantly reducing environmental risks and ecological scarcity.”

UNEPS reports look at the three pillars of economy , environment and social development . As of today, economics dominates as economic practice is the cause of many social and environmental problems . But many are afraid that a kind of “greenwashing” of the economy will only result in cosmetic changes on the surface of the existing system.

A green economy must therefore in many ways serve to ensure that production and consumption do not exceed the limits of the earth’s (biosphere) performance and endurance . The economy must become a tool for equitable distribution and social development locally and globally.

A green economy is also about realizing what is sufficient consumption – and taking the consequences of this. Nature’s resources are globally common property, often characterized by the slogan One Planet – One Humanity!

New technology is important for a green economy, but not sufficient. The transition to a green economy is about values. Increased well-being and welfare for everyone in the North and South requires a discussion of what values ​​we can focus on as a basis for sustainable development.

There is therefore something to be gained today from the so-called “happiness research”. This also includes a change in the financial sector. In a green economy, banking and financial institutions must be servants of the real economy. The world is shaped by where and how money is invested. We must therefore increasingly invest in “new, green technologies”. Harmful subsidies must go away. In a green economy , the environmental costs of goods and services will also have to be covered in the price of any product .

What is happening in China under Xi Jinping 3