The Hammer, Sickle, and a Love for Money

Text and Photos Zigor Aldama

They entered in hordes to explore a cheap manufacturing base and to pioneer their business given the huge potential market for their products. In exchange, China got everything its leaders wanted: Protecting core sectors and enacting laws that required foreign companies to establish themselves in the country with joint ventures was a perfect means of achieving the transfer of technology.

Almost four decades later, this strategy has paid off. China is the second-largest economy in the world – the first if purchasing power parity (PPP) is used; it is the main trade power with the biggest surplus in history, and the factory of the world. Moreover, with the help of the government, China has created a group of huge companies with the ambition of going global, shaking up the world order.

Individualism and consumerism have given the boot to old-fashioned fraternity and collectivism

Pedro Nueno, president of CEIBS and professor at Spain’s IESE Business School, agrees: “Chinese people live much better now than they did 20 years ago. The fact that labour is much more expensive may deter some businesses from setting up camp in China, but it’s a huge victory for a country where domestic demand is driving the economy, rather than exports and foreign investment. Some say China is in trouble because it has grown at its slowest pace in the last quarter of a century, but I say a well distributed growth of five percent is much better than a concentrated eight percent.”

Nueno believes that Chinese leaders are among the smartest in the world. He defends the claim by explaining how they use another characteristic of communist states: government intervention. “The Communist Party has reigned over different problems of the market economy – the real estate bubble, for example. It has set rules to make it more difficult for speculators to manipulate the market. The same goes for stocks, where the real value and market value of companies were a world apart. The situation required an adjustment, and Beijing didn’t hesitate. Their wisdom is preventing a crash like the one in the US a decade ago.”

But not everybody likes this. Asked about the protectionism that the American and European Chambers of Commerce criticise in their annual reports, Xu says: “It’s not something exclusive to China. The US – especially with Donald Trump in charge – and the European Union subsidise their companies, contravening World Trade Organisation regulations. They’re right to demand more economic reforms, but they should also acknowledge the market economy, and the profound reforms of China.”

Macroeconomics aside, Chinese millennials – born long after the Cultural Revolution – are the most confused about the meaning of communism. “They teach us a theory that has nothing to do with reality.

key events

The Mao we love the most is the one printed on 100 yuan bills,” jokes Chen Qing, a 25-year-old salon stylist. “We have an entrepreneurial heart, but sharing is not one of our strong features.”

Zhu Liya, a 26-year-old owner of a pearl trading company, adds: “Communism as imagined by Marx or Mao doesn’t fit Chinese people.”

Ding Chen, a purchase manager at a foreignowned engineering company, doesn’t see China as a communist country either. “It’s just an authoritarian government with a capitalist economy where laws protect leaders’ businesses,” the 30-year-old says. “That explains why the gap between the rich and the

Their mission is guided by a set of questions: Why – and how – did the mammoth disappear some the mammoth disappear some the

The Communist Party of China with Xi at its helm feels stronger than ever. Those interviewed agreed that although its fall has been predicted in the West many times since the founding of the People’s Republic in 1949, a change of political rule is highly unlikely. The respondents also felt that there will be a faster shift towards capitalism and, thanks to Donald Trump’s policies, a huge increase of Chinese influence globally.

“We must oppose protectionism and facilitate both free trade and investment,” said Xi at this year’s World Economic Forum. His words left many speechless.

But, it makes sense. China needs to expand. The state is flexing its muscles, exerting its influence in the developing world with new initiatives and agreements – such as the BRICS (the association of five emerging economic powers: Brazil, Russia, India, China and South Africa) and One Belt, One Road (a huge infrastructure programme, initiated by Xi Jinping, linking China with Africa, Asia and Europe via roads, railways and ports) – in which the US don’t take part. China has also set up international institutions, such as the Asian Infrastructure Investment Bank (AIIB) which will help fund Beijing’s international agenda. As Xu Bin puts it: “China is just regaining the place it deserves on the world stage.” ag

Sultanate of Oman

POPULATION: 2.9 milio n SULTAN: Qaboo s Bin Sai d Al Sai d Oman is the oldest independent state in the Arab world. The current sultan (and prime minister) claimed power from his father, Said Bin Taimur, in 1970. His policies have mostly been met with favour