China’s economic growth is a force for good
Published by The Daily Telegraph (21st October, 2015)
As Britain rolls out the red carpet for China’s president, draping the communist leader in as much pomp and circumstance as can be mustered, there is excitable talk of a “golden era” in our relationship with Beijing. Difficult issues such as cyber-terrorism and human rights are brushed under the carpet as we bow before the new global powerhouse, while alarmed commentators talk about Western decline.
Yet the remarkable rise of China should be welcomed. Last year, on one measure, it became the world’s biggest economy, overtaking the United States (which had held the title for 142 years). Thus China regained the position it has held for most of human history; indeed, early in the 19th century it was responsible for an estimated one-third of global output. This, however, is not a zero-sum game – and its return to the top should be seen as a sign of global progress and opportunity.
When the last Chinese president came to Britain on a state visit – in 2005 – his country had the smaller economy. Now his successor Xi Jinping presides over an economy triple the size of ours – but our decline is relative, not real. China’s growth does not come at our expense. Over the first decade of this century, while China grew at 10 per cent a year, the British economy expanded by a healthy 15 per cent. Meanwhile that phenomenal pace of change in China pulled almost 700m people out of extreme poverty in three decades, an astonishing feat.
Rapid growth has been seen also in many other Asian and African countries, the twin motors of capitalism and consumerism pushing millions more people from poverty to prosperity. As British economist Charles Kenny showed in ‘The Upside of Down’, this benefits everyone in a globalised world. Poor countries becoming richer, healthier and better educated buy more, make more and innovate more. So they boost progress and wealth around the planet with bigger markets, business breakthroughs, medical innovations and technological advances.
It is not just about newly-rich Chinese shoppers buying designer clothes in London and Paris. Chinese goods are assembled with parts often designed and made in the West. They churn out cheap motorcycles that help children get to school in poorer parts of Asia and cheap mobile phones that have transformed life in Africa in fields from agriculture to medicine. Some innovations then feed back to wealthier countries, such as India’s cheap medical devices developed for rural clinics and Kenya’s mobile money transfer system.
There will always be one-eyed critics of globalisation. David Cameron has come under pressure to raise the issue of cheap Chinese steel imports, blamed for Tata slashing nearly 1,200 jobs in Scunthorpe and Lanarkshire. Yet this Indian firm is also a key driver in the extraordinary revival of Britain’s car industry through its ownership of Jaguar Land Rover. It is among a clutch of foreign firms that invested heavily in iconic British brands, rewarded with soaring sales after saving them from the scrapyard.
Some worry about rising China sucking up resources. But as with oil and copper, we have ways of finding more. Meanwhile concerns over China’s impact on the environment are justified – but there is hypocrisy in how the West sees developing nations. China may be hideously polluted as it powers through economic takeoff, yet it is also investing vast sums in renewable energy. It is, for instance, the world’s biggest producer and consumer of solar energy, while twice as many Chinese as Americans say they will take a hit in the pocket to save the planet. Meanwhile Britain stupidly cuts solar subsidies, forcing four firms out of business over the past fortnight, even as it chucks billions at the Chinese tobuild nuclear power plants here.
The combative Chinese ambassador to Britain has rebuffed criticism over steel, saying nations must move on and make adjustments in the modern world. He is right. Britain’s challenge is to harness its impressive soft power, retain its openness, upgrade its education and improve its skills to thrive in this fast-changing world. China shows how the world is getting wealthier, creating more opportunities for all – and that is something worthy of celebration.