Parting Paths: From Deng's Vision To Xi's Divergence
Date
12/1/2023 12:11:11 AM
(MENAFN- Asia Times) Had Deng Xiaoping not sought and received advice from Japan and Singapore in his creation of“socialism with Japanese and Singaporean characteristics,” China's economic miracle would have been less miraculous. China's current economic woes stem largely from Xi Jinping's abandonment of this paradigm.
When Mao Zedong died in 1976, China was the second poorest
among 140 countries . Deng Xiaoping proclaimed a remedy of“reform and opening up” to foreign countries, drawing from previous Asian success stories. During an October 1978 trip to Japan, Deng met with business leaders, toured a Nissan auto plant and saw China's future.
“We are a backward country and we need to learn from Japan,” he told a press conference in Tokyo. His first official foreign economic advisor was Saburo Okita, one of the legendary architects of Japan's economic miracle. Over the years, 22,000 advisors from Singapore came to China.
Instead of Mao's command economy dominated by state-owned enterprises (SOEs), the government adopted a Japan-style industrial policy. Deng combined various governmental measures to direct resources to modern industry, leveraging the efficiency of private firms.
To avoid the pitfalls associated with economies favoring a single“national champion” across assorted industries, it becomes imperative for private companies to engage in healthy competition. By 2018, SOEs dwindled to 12% of urban employment and exports and one-third of business investment.
SOEs never could have created the economic miracle. Nearly half of SOEs regularly run losses, causing the economy to shrink every time they make a product. Even profitable SOEs create less growth than private companies for every yuan invested.
MENAFN01122023000159011032ID1107518979
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.