Its aggressive handling of Covid—in sharp contrast to that of many Western countries with higher death rates and later, less-stringent lockdowns—has, if anything, reinforced that view. China has also defied predictions that its authoritarianism would inhibit its capacity to innovate. It is a global leader in AI, biotech, and space exploration. Some of its technological successes have been driven by market forces: People wanted to buy goods or communicate more easily, and the likes of Alibaba and Tencent have helped them do just that.
This, of course, mirrors the role of U. But in China the consumer applications have come faster, making more obvious the link between government investment and products and services that benefit individuals.
Our own experiences on the ground in China confirm this. A cleaner in Chongqing now owns several apartments because the CCP reformed property laws. A Shanghai journalist is paid by her state-controlled magazine to fly around the world for stories on global lifestyle trends. In the years since, China has become an economic titan, a global leader in technology innovation, and a military superpower, all while tightening its authoritarian system of government—and reinforcing a belief that the liberal narrative does not apply to China.
The truth, then, is that China is not an authoritarian state seeking to become more liberal but an authoritarian state seeking to become more successful —politically as well as economically. It continues apace. One example is the reinvention in the late s of the Central Commission for Discipline Inspection. Empowered by Xi to deal with the corruption that had become so prevalent early in that decade, the commission can arrest and hold suspects for several months; its decisions cannot be overturned by any other entity in China, not even the supreme court.
The commission has succeeded in reducing corruption in large part because it is essentially above the law—something unimaginable in a liberal democracy. These are the reforms China is making—and they need to be understood on their own terms, not simply as a distorted or deficient version of a liberal model.
It often compares itself to brands with which Westerners are familiar. China is also often at pains to suggest to foreign governments or investors that it is similar to the West in many aspects—consumer lifestyles, leisure travel, and a high demand for tertiary education. The resulting victory, which for decades the CCP spun as its solo vanquishing of an external enemy, was reinforced by defeat of an internal one Chiang Kai-shek in , establishing the legitimacy of the party and its authoritarian system.
A Marxist system is concerned primarily with economic outcomes. That has political implications, of course—for example, that the public ownership of assets is necessary to ensure an equal distribution of wealth—but the economic outcomes are the focus. Leninism, however, is essentially a political doctrine; its primary aim is control. So a Marxist-Leninist system is concerned not only with economic outcomes but also with gaining and maintaining control over the system itself.
That has huge implications for people seeking to do business in China. If China were concerned only with economic outcomes, it would welcome foreign businesses and investors and, provided they helped deliver economic growth, would treat them as equal partners, agnostic as to who owned the IP or the majority stake in a joint venture. This plays out every time a Western company negotiates access to the Chinese market. Our response? Yukai Du. A Leninist approach to selecting future leaders is also a way the CCP has maintained its legitimacy, because to many ordinary Chinese, this approach produces relatively competent leaders: They are chosen by the CCP and progress through the system by successfully running first a town and then a province; only after that do they serve on the Politburo.
Familiarity with Leninist doctrine is still important for getting ahead. The Leninist nature of politics is also evidenced by the language used to discuss it. In fact, the Chinese word for the resolution of a conflict jiejue can imply a result in which one side overcomes the other, rather than one in which both sides are content.
China uses its particular authoritarian model—and its presumed legitimacy—to build trust with its population in ways that would be considered highly intrusive in a liberal democracy. The benefits are both financial for example, access to mortgage loans and social permission to buy a ticket on one of the new high-speed trains. Here, China is surprisingly catching up with the pack.
Consider tariffs: With a tariff rate of 7. Our experts review the individual China measures pursued by the US and its Allies and partners within their global political and economic context. Because taxation and accounting have never been so important. And because the whole is more than a sum of its parts, for the military and the markets alike. In addition to tariffs, we looked at other ways that countries restrict trade in goods and services and created a trade openness index.
China scored a 4. The bottom line? However, restrictions on the services trade—and especially digital services—remain higher than in open-market economies. Direct investment openness refers to access for foreign firms to invest in domestic businesses, and freedom for local companies to invest abroad. These are key features of open economies and encourage competitive international markets.
China landed at 2. But if you look at inward FDI intensity—meaning the total value of foreign investment as a percentage of its GDP—China is actually regressing. It should be a golden age in this regard for China, which aims to become one of the largest FDI recipients in the world.
Over the last several years, however, the Chinese government has slowed the pace of liberalization and failed to create a level playing field for foreign companies. It has also continued to tightly control outbound FDI by Chinese companies, after a short episode of liberalism from to Our data shows how much China is hampered by its own restrictions.
Portfolio investment openness involves limited state controls on cross-border flows, both incoming and outgoing, in equities i. The ability to have a diversified portfolio is something we can take for granted in the United States. Not so in China. Over the past several years, foreign investors have flocked to Chinese markets in search of the higher returns that usually outpace the near-zero yields offered in Western bond markets.
Nevertheless, China scored a 1. It has barely progressed on this measure over the last decade. But that's not necessarily for lack of trying. Arguably no area of the Chinese economy has seen more attempts at liberalization than portfolio investment, including the creation of new systems to enable foreigners to invest in Chinese markets.
Coming into , the dominant message out of China was that it intended to deepen its integration with the global financial system. But fear of volatility seems to have once again won the day, at least for now. Recently the Chinese government rolled out a series of ostensibly security- and data privacy-oriented restrictions on incoming and outgoing investment. But the numbers show the potential not just for China but for the rest of the world if Beijing were to finally undertake the reforms it has been promising.
This study confounds the narrative that China has never wanted to play by international economic rules. The data demonstrates that under Xi, China has tried to implement some liberalizing reforms. Much of its post convergence with open-market economies, after all, was under his direction. But, in large part because Xi and other Chinese leaders have been unable to reconcile those efforts with their desire for more control, the reforms have failed to deliver. Then many of those same people decided that China never wanted to emulate open-market economies at all.
US policies have swung like a pendulum because of these assumptions, but both miss the mark. Chinese leaders might yet decide that liberalization is the answer after all. The study also discredits the narrative that Chinese leaders have cracked the code coveted by so many authoritarians—that they have figured out a way to have a dynamic economy and illiberal political controls all at once. In category after category, China is inflicting costs on itself through its decisions to not be more like open-market economies.
That means the s could take the country in dramatically different directions. And the World Health Organization says more than a million people in China die every year due to air pollution.
As China's gross domestic product GDP has skyrocketed, its shopping habits have changed too. Chinese shoppers are among the world's highest consumers of luxury goods. President Xi Jinping emphasised China's economy - and how it had transformed people's lives - during a long speech on Tuesday marking the anniversary of the economic reforms.
There's even a political element to this. As Chinese consumers have grown richer, they've become increasingly influential. Several companies have been forced to apologise after offending Chinese sensibilities, and while foreign brands are generally coveted in China, more and more shoppers are starting to say they prefer local brands. It's a sentiment that Mr Xi also touched on in his speech, when he said: "China is increasingly approaching the centre of the world stage.
Life has changed significantly for children of the s, compared to children of the s. For starters, they are likely to live longer - China's life expectancy was 66 back in , and is now about For most Chinese children in the s, going on an overseas holiday would have been almost unthinkable. Today China has the world's largest number of outbound tourists - who spend billions of dollars while abroad. Chinese students are now also more likely to end up studying abroad.
According to Chinese government figures, China is currently the world's largest source of international students. One thing hasn't changed as much as the government would like though - the birth rate. In - a year after starting economic reforms - the government imposed a one-child policy to try and curb population growth. Birth rates were declining anyway - but the controversial policy was harshly enforced in some cases.
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