Asia-Pacific
Beijing to face global risks 'proactively'
By Fu Jing, Zhang Haizhou and Zhang Chunyan (China Daily)
Updated: 2010-10-20 07:45
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BRUSSELS / LONDON - Beijing's leadership has signaled its desire for more "proactive" approaches to counteract global risks, while European experts say China will face profound challenges from abroad should the West continue to suffer from economic distress.
The analysts said the leadership, which concluded its annual decision-making plenary on Monday, has created a "strategic" shift to deal with "predictable and unpredictable" risks at home and overseas with hands-on approaches.
After the four-day Fifth Plenary Session of the 17th Central Committee of the Communist Party of China, Beijing's highest leadership issued a public communiqu, asserting that China is still bracing for a strategic period of tremendous development opportunities - while "predictable and unpredictable" external and internal risks are increasing.
Nonetheless, the document also urges decision makers to employ "proactive solutions" to cope with and create a sound environment for China's modernization drive. "The leadership is sober-minded when assessing the risks," said Men.
"As China has been integrated into the global economy, its risks are two-fold," he said.
First, many external and often unexpected risks or accidents - such as extreme weather events, energy supply fluctuations, financial turmoil, trade wars or terrorist attacks - may have a huge effect on China - given its huge population, and its high dependence on global supply chains.
"Another front is from China itself," said Men. Moreover, he noted, China's capacity to protect its territorial sovereignty, combat separatism and cope with natural disasters and disease epidemics has global consequences.
Indeed, "if China couldn't deal with these issues properly, these will have global consequences as many cases during past five years have already shown," Men added.
But after decades of learning how to deal with the international community, China's leadership has grown extremely mature - by any standard.
"We are delighted to see that China has decided to take proactive - not reactive - approaches to meet the challenges," said Men.
David Fouquet, director of the Brussels-based Asia Europe Project Information Service, said the West has had considerable interest and involvement in the outcome of the historic plenary.
"But attitudes and tolerance toward China may also be determined by socioeconomic factors," said Fouquet.
Rather, if the West manages to reduce some of the economic, social and political stresses arising from the economic crisis of the past two years, it may experience greater tolerance and accept the situation in China, he said.
But if the economic strain is maintained, it is bound to stimulate a more defensive attitude on the part of Western political systems - based on people, politicians, members of the media and economic and intellectual leaders.
Under such conditions, "things will continue to get tough with Chinese policies that could raise tensions in foreign relations," said Fouquet.
Domestic challenges
On the economic development pattern, Fouquet said there are widespread and persistent perceptions that Beijing's current economic development model - although originally appropriate for the past phase of economic expansion - is no longer suitable, both internally and globally, and distorts current and future priorities.
Meanwhile, the great part of China's population that still lives on around $1 a day has its economic needs and grievances as the more comfortable, emerging middle classes seek more economic security and stability.
Fouquet said China's leadership should find solutions to the above domestic challenges in the coming five years.
To a great degree, the communiqu embodies the leadership's "determination" to tackle matters like social injustices and widening income gaps, according to Lu Yiyi, an expert on Chinese politics and social development at the London-based Royal Institute of International Affairs.
China has one of the greatest wealth disparities in the world, with the richest 10 percent earning 65 times the average salary of the poorest 10 percent, according to a Credit Suisse-sponsored study by Chinese economists.
"China will further boost people's incomes, enhance social construction and deepen reform and opening up," said the communiqu.
But with the exception of the determination, Lu pointed out that China still has a long way to go before achieving full social justice.
"When you are trying to boost the incomes of the poor, you may find the incomes of (the wealthier) increase even faster. It's a problem of the economic structure," she said.
Lu added that China is now "entering a difficult period of reform".
"As society is getting increasingly diverse, it's very hard to simply have a policy to satisfy everyone."
Any measure that works in a certain area may likely bring side effects to others, she added.
Beijing "is looking at rebalancing the economy, addressing the lack of social infrastructure in the less developed areas, and trying to marry the huge wealth of some of the country, and some sectors of the population, with the large amount of poverty that still exists," Kerry Brown, a senior fellow at the UK's Royal Institute of International Affairs, told China Daily.
When asked about China's development in the coming five years, Brown said that GDP growth will continue to be strong, and in that China will perform well in productivity.
"But I think also the challenges of the last five-year plan remain true for this one - rebalancing, the issues of energy efficiency and sustainability and the problems of creating better governance structures in society," Brown noted.
Fu Jing reported from Brussels, and Zhang Haizhou and Zhang Chunyan reported from London.