The West has an inaccurate picture of China, leading economist says

Leading economist Jin Keyu believes that as New China celebrates its 70th anniversary, it is demonstrating how a strong State can act to improve people’s lives.

The 36-year-old associate professor at the London School of Economics said this stands in contrast to the West, where people have lost faith in governments being able to deliver.

“That is the critical difference between China and the rest of the world. It is the belief that the utilization of State capacity can improve the economy and better people’s lives.”

Jin said this is particularly important in China’s new era under President Xi Jinping, who has placed particular emphasis on the country’s political system delivering results for the “grassroots and the masses”.

She said that in the West, despite standards of living falling for many people since the global financial crisis of 2007-08, governments are not seen as important players.

“People are against big government. They are against the notion of state intervention. This was not the case in the past where there was massive use of state capacity such as the post-war Marshall Plan. The role of the state also formed the thinking of founding fathers of the United States such as Alexander Hamilton.”

Jin said people such as Gordon Chang, author of The Coming Collapse of China, who try to highlight weaknesses in the country’s economy, fundamentally misunderstand the strengths of its system.

“It is a large apparatus where you have the kind of governance that can coordinate and move resources around to deal with problems. You don’t have these problems of the Fed having to get agreement with the Treasury, as in the US,” she said, referring to the Federal Reserve.

Jin, a Beijing native who is the daughter of leading economist Jin Liqun, president of the Asian Infrastructure Investment Bank, studied economics at Harvard.

She has held a number of academic positions, is a regular commentator on the Chinese economy and is also writing a book on the country’s political economy, which will be published next year.

Jin said many people in the West have a completely inaccurate picture of the lives of Chinese as the country marks its landmark anniversary.

“People in the West seem to regard well-being as whether you can post an inflammatory message on the internet or not. As a woman in her 30s, I have never felt safer than when walking the streets of Beijing alone. Security and safety are priorities as well as access to health and education.”

Jin believes the new era is an important phase in the nation’s development and also its role in the world with major projects such as Belt and Road Initiative, which she believes could transform global infrastructure.

“We have a massive infrastructure gap in the world, but no government — other than China’s — is willing to step in and deal with one of the world’s most intractable problems,” she said.

Jin added that although everyone is focused on trade with the ongoing dispute between the United States and China, the biggest impact China is likely to have on the world is when it opens up its financial sector.

“We are stuck talking about trade, but it is just a one-time thing and will soon be over. What nobody really talks about is the impact China is likely to have on the financial world when it opens its markets. It will have major global significance.”

Jin believes that with the new era Xi has brought a fresh dimension to China’s global role.

“Before the new era, China’s story (since reform and opening-up) was largely seen as an economic one. China now is much more clearly defined. The primacy of culture and national sovereignty has become much more clearly defined.

“What is also important is the capacity of the State to make people’s lives better and to unabashedly embrace that concept.”

We are stuck talking about trade, but it is just a one-time thing and will soon be over. What nobody really talks about is the impact China is likely to have on the financial world when it opens its markets. It will have major global significance.” Jin Keyu, leading economist