Achieve­ments make China a ma­jor power

China Daily (Hong Kong) - - 19th CPC National Congress -


Erik Ber­glof,






Eswar Prasad, the Tolani Se­nior Pro­fes­sor of Trade Pol­icy at Cor­nell Uni­ver­sity and a se­nior fel­low at the Brook­ings In­sti­tu­tion. He was the for­mer head of the IMF’s China Di­vi­sion.

Her­man Van Rom­puy has served as Bel­gian prime min­is­ter and pres­i­dent of the Euro­pean Coun­cil. In both ca­pac­i­ties, he re­ceived Xi Jin­ping dur­ing his vis­its to Bel­gium and the Euro­pean Union head­quar­ters in 2009 and 2014 re­spec­tively. Xi also met him ei­ther in Bei­jing or on other oc­ca­sions be­fore the vet­eran Euro­pean politi­cian stood down from his po­lit­i­cal ca­reer in late 2014.

Of those meet­ings, Van Rom­puy says he is keen to high­light two speeches Pres­i­dent Xi de­liv­ered in Europe.

The first one that im­pressed him was given by Xi at the Col­lege of Europe in the pic­turesque Bel­gian city of Brugge, where Van Rom­puy is still teach­ing, when Xi wrapped up his first tour to West Europe as Chi­nese pres­i­dent in early 2014.

“In the speech, Xi ex­plained China’s long his­tory of civ­i­liza­tion and the im­pres­sive achieve­ments made by strate­gic part­ners China and the Euro­pean Union,” Van Rom­puy re­called in Brus­sels dur­ing a rare ex­clu­sive in­ter­view fol­low­ing his re­tire­ment.

Xi has pro­posed both sides forge a part­ner­ship from peace, re­form, growth and civ­i­liza­tion, which have al­ready be­come guide­lines of their bi­lat­eral re­la­tion­ship. In this sense, Van Rom­puy said Xi’s speech is “po­lit­i­cal sym­bolic”. As politi­cians, he said “words are equally im­por­tant as ac­tions”.

Dur­ing Xi’s visit to the Euro­pean Union head­quar­ters be­fore giv­ing the speech, both China and the bloc were plan­ning to find syn­er­gies be­tween the Belt and Road Ini­tia­tive and Euro­pean de­vel­op­ment pro­grams. In late 2014, af­ter Don­ald Tusk re­placed Van Rom­puy, both sides started to forge syn­er­gies be­tween the ini­tia­tive and multi-bil­lion-euro Euro­pean in­vest­ment scheme.

“China is very good at longterm plans and we hope that this ini­tia­tive can be very suc­cess­ful in de­vel­op­ing the bi­lat­eral re­la­tions,” Van Rom­puy said.

Xi’s speech ad­vo­cat­ing open economies and free trade and the fight against pro­tec­tion­ism was the sec­ond one Van Rom­puy wanted to high­light. “We were much im­pressed by Pres­i­dent Xi’s speech in Davos, which show­cased China’s en­gage­ment to an open econ­omy in a glob­al­ized world,” said Van Rom­puy.

Van Rom­puy said the Euro­pean Union shared with Xi’s ad­vo­cacy, when the West was sur­rounded with ter­ror­ism, pop­ulism and iso­la­tion­ism.

In look­ing for­ward, Van Rom­puy said China and the Euro­pean Union are strate­gic part­ners, but it doesn’t mean that both sides can­not have dif­fer­ences at a time when both sides have their lots in com­mon.

“In this pure re­la­tion­ship, we can ex­plain to each other about the dif­fer­ences we have,” he said.

Van Rom­puy said the Euro­pean Union is the world’s big­gest open econ­omy and he is con­vinced that the union’s re­cent move to unify the in­vest­ment screen­ing sys­tem at the Euro­pean level was not meant to tar­get China. “Our po­si­tion is that in or­der to keep this open­ness on the global scale, we need this level-play­ing field,” he said.

“Oth­er­wise we will lose sup­port for open trade and in­vest­ment within the Euro­pean Union and we need the sup­port of our ci­ti­zens. This is noth­ing to do with pro­tec­tion­ism and we don’t tar­get China.”

Van Rom­puy said a sta­ble Euro­pean Union is in the in­ter­ests of China.

He also rec­og­nized China’s ef­forts an­nounced in its mar­ke­to­ri­ented re­form pack­age at the 3rd Plenum of the 18th Com­mu­nist Party of China Cen­tral Com­mit­tee and he ex­pected China to fur­ther show­case its de­ter­mi­na­tion to deepen its re­form ef­forts at the soon-to-come 19th Na­tional Congress of the CPC.

What do you feel has been China’s big­gest achieve­ment over the past five years? What’s the most no­table change you’ve ob­served?

China’s pol­i­cy­mak­ers have steered the econ­omy through a se­ries of dif­fi­cult do­mes­tic and global chal­lenges. They have kept the econ­omy on a path of steady growth, pulling mil­lions of peo­ple out of poverty, sub­stan­tially im­prov­ing the liv­ing stan­dards of China’s ci­ti­zens, and es­tab­lish­ing China as a ma­jor eco­nomic power.

What three words would you use to de­scribe China to­day?

An eco­nomic and mil­i­tary su­per­power, as­sertive, pro­vid­ing global lead­er­ship.

What’s the big­gest chal­lenge China faces, and how do you feel the coun­try can go about over­com­ing this dif­fi­culty?

China needs to fix its fi­nan­cial sys­tem. This is cru­cial to im­prove al­lo­ca­tion of re­sources to the most pro­duc­tive sec­tors of the econ­omy, gen­er­ate bet­ter em­ploy­ment growth, and re­duce the risks to the econ­omy from fi­nan­cial sec­tor prob­lems. Both the short-term goals of main­tain­ing growth and longert­erm goals of im­prov­ing pro­duc­tiv­ity and re­bal­anc­ing the econ­omy de­pend on the ef­fi­ciency of the fi­nan­cial sys­tem.

What are your ex­pec­ta­tions for the up­com­ing 19th Na­tional Congress of the Com­mu­nist Party of China? What are the key is­sues you care about most?

I hope that new mem­bers of the se­nior lead­er­ship team (the Polit­buro Stand­ing Com­mit­tee) as well as any new ap­point­ments at the ma­jor fi­nan­cial and reg­u­la­tory agen­cies, are of peo­ple with an un­der­stand­ing of how im­por­tant it is for China to make rapid progress on a broad range of macroe­co­nomic and fi­nan­cial sec­tor re­forms.

Af­ter the Congress, I hope we will see a re­newed ef­fort to un­der­take a broad range of macroe­co­nomic and struc­tural re­forms, in­clud­ing bank­ing sys­tem re­forms, cor­po­ra­ti­za­tion of the State-owned en­ter­prises, hukou (house­hold reg­is­tra­tion) and land re­forms, im­prove­ments to the fis­cal rev­enue and ex­pen­di­ture sys­tems, and a shift to a mar­ket-de­ter­mined ex­change rate.

How do you view China’s role in to­day’s world?

China has been at­tempt­ing to play a con­struc­tive role as a global leader, ac­cept­ing some of the re­spon­si­bil­i­ties that come with that role.

With its eco­nomic might as the sec­ond-largest econ­omy in the world, it has a key role to play in build­ing up an in­ter­na­tional con­sen­sus on is­sues such as global gov­er­nance, free trade, tack­ling cli­mate change, and women’s rights. The ren­minbi’s in­creas­ing promi­nence as an in­ter­na­tional cur­rency also means that China will start play­ing a big­ger role over time in global fi­nan­cial mar­kets.

Do you be­lieve that some of China’s ex­pe­ri­ences or prac­tices could be used to solve press­ing global prob­lems? If so, what are they?

China has been very suc­cess­ful at ex­per­i­ment­ing with small-scale re­forms be­fore scal­ing them up. This is an ap­proach that could be used to deal with a broad range of re­forms, both at the coun­try and global lev­els. China has also been ef­fec­tive at de­ploy­ing state re­sources to im­prove the ed­u­ca­tion sys­tem and the skills of its work­force.

While China it­self still faces many chal­lenges in these ar­eas, its em­pha­sis on ed­u­ca­tion, ru­ral de­vel­op­ment, and en­vi­ron­men­tal con­scious­ness are all rel­e­vant for other coun­tries as well.

What’s the most un­for­get­table ex­pe­ri­ence or mo­ment you’ve ever had in China, or re­lated to China?

My first time in each of the ma­jor cities in China such as Bei­jing, Shang­hai, Dalian, Tian­jin has im­pressed me with the qual­ity of phys­i­cal in­fra­struc­ture. As an In­dian, I wish In­dian cities had equally im­pres­sive in­fra­struc­ture to boast of!

In my meet­ings and var­i­ous in­ter­ac­tions with Chi­nese lead­ers and pol­i­cy­mak­ers, I have been im­pressed by their will­ing­ness to lis­ten to ad­vice from a broad range of do­mes­tic and in­ter­na­tional ex­perts, and their ea­ger­ness to learn from the pos­i­tive and neg­a­tive ex­pe­ri­ences of other coun­tries with var­i­ous poli­cies.

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