The first time that I stepped foot in China was in 2008. I was on an exploratory voyage of Tibet and Nepal. After being amazed by the view of the Himalayas, the colorful Buddhist temples, and the magnificence of Tibetan cultural values, I started to glimpse the power of globalization and its impact in those remote places.
Who would tell the Dalai Lama that, in front of the Potala Palace, there would someday be apartment buildings, bright, neon advertisements, and a myriad of hotels for tourists. Or that, strolling through Lhasa, the capital with an altitude of 3650 meters and one of the highest cities in the world, the offer of goods made in China would be just around the corner. This is undoubtedly an example that demonstrates the symptoms of the era of globalization; symptoms that affect the whole world and blur the cultural, political, and economic borders around us.
In recent years, China’s growth has continued at a yearly 8%, which, according to the IMF, makes China the largest economy in the world. How has China managed to join what many call the fourth industrial revolution? What strategy has the Chinese government followed to bring about one of the fastest growths ever seen?
I have had the opportunity to participate in the Doing Business in China program, organized by the UPF Barcelona School of Management in conjunction with Fudan University. A week of education in Shanghai to understand first-hand the reality of what happens in Asia in a global context.
Mao ZeDong’s first attempts at industrialization were catastrophic. In the seventies, China opened itself to the world, adapting a few market mechanisms. The government created special regions to promote foreign investment. This measure attracted European and North American capital using the inexpensive, Chinese workforce. By 1990, there were already millions of Chinese workers manufacturing for the rest of the world. Today China is no. 1 in the production of 220 categories of products:
- 90% of DVD players in the world
- 80% of microwaves
- 80% of laptops
- 75% of toothbrushes
- 70% of air-conditioning units
- 60% of color TVs
- 60% of cell phones
China is the largest worldwide exporter and the largest vehicle manufacturer in the world. This makes China the country with the fastest-growing economy in the world since the 1980s, with an average annual growth of 10% for the last 36 years.
The strategy corresponds to the motto, “One China”: a unique business environment, enthusiasm for education with an emphasis on human capital, a unique desire for growth, allowing for moments of growth and expansion, and, last of all, a unique economic market, with strong government intervention.
This is all happening in order to quickly enrich one part of the population and, thus, allow for the growth of the nation as a whole. In 2018, China’s eastern region accounts for 64% of the total GDP of 54% of the 1.3 billion Chinese people. The magnitude of the growth of China’s middle class is transforming the nation.
We could ask ourselves whether an interventionist model of government is the best option to join the era of globalization, or what has occasioned the country’s focus on the rapid enrichment of one part of the population, compared to the 46% of the population that continues living in a state of poverty. What does the “One China” motto imply with respect to attention to diversity and differences between regions, among other issues?
In any case, as the President of China, Xi Jinping, proclaimed in 2013, the Chinese Dream has the short-term goal that, by 2021, Chinese society will live at least moderately well-off, and the long-term goal that China will become a fully developed country by 2049. In light of current data, we can affirm that China’s advances in development have been impressive, making the country a new economic giant in the international arena, as well as in the era of globalization. Opportunity or challenge?