The Shanghai Bund is a 1.6-kilometer promenade on the west bank of the Huangpu River.
Photo: Taken from Newspaper 26.
With two sentences from Deng Xiaoping, Li Ziying, a professor at the University of Foreign Studies in Beijing, China, summarizes the characteristics and evolution of the process of reform and opening undertaken by this country since 1978. “A cat is good as long as it can catch a rat”, and “crossing the river touching the stones underfoot”, said at the time who is considered the architect of the most important economic transformations carried out here in the last half century.
But what do they really mean?
To understand them -explains the academic- it is necessary to take into account the specific conditions in which China faced the challenge of being the most populous country in the world and at the same time having a percentage of arable land below countries such as the United States or India. whose population is smaller.
At the end of the 1970s, he adds, the Asian nation had a predominantly rural population, serious imbalances in the distribution of its inhabitants in general, as well as its water and energy resources.
Within its economic structure –precise–, industry carried the greatest weight, to the detriment of agriculture itself and services;
there was a large gap in gross domestic product (GDP) per capita with respect to industrialized economies;
Government revenues had decreased and there was mounting pressure from unemployment.
Li Ziying, a professor at the University of Foreign Studies in Beijing, China.
Photo: Taken from Newspaper 26.
Faced with this, he explains, the leadership of the Communist Party at that time, with Deng Xiaoping at the helm, proposed a complete but gradual transformation of the national economic model.
When Deng referred to the fact that "a cat is good as long as it can catch a rat" -he translates-, he was saying that it was necessary to assume the economic theory that would allow the development of the country, even if that was going against what had been considered socialist until that time, it was planning.
On the other hand, changes would be made through trial and accumulation of experience, going step by step, just like crossing a river: "Touching the stones underfoot."
The changes began in the field
The also vice-dean of the Academy of Regional and Global Governance of the Beijing Foreign Studies University (BFSU), reports that the reform began with agriculture with a clear intention: its reactivation through the liberalization of production, suppressing the allocation system public.
The peasants – he underlines – were able to decide for themselves about the crops and their commercialization, placing the responsibility contract as the main mechanism for negotiating business.
However, she notes, the agrarian transformations did not conclude until 2005, with the abolition of the agricultural tax, a type of tax that had existed since the time of Emperor Qin Shi Huang.
There were six transcendental reforms that promoted the economic development of China, lists the also subtitle of the Faculty of Hispanic and Portuguese Studies: In 1980, that of the rural contract liability system that began its activation;
then that of the price system in 1989;
and in the 1990s, that of the means of subsistence and production.
Followed by the reform of the property rights system of medium-sized state enterprises, which privatized state entities with low productivity and in non-strategic sectors.
Then, in 1994, the reform of the financial system and the one already mentioned on the agricultural tax took place: “Since the beginning of the 21st century, the transformation of the social security system has taken place, which liberalized home ownership and Health insurers. and pensions;
Infographic: Newspaper 26.
The logic – stresses Li Ziying – has been to promote economic development following four cardinal principles: adhering to the socialist path, popular democracy, Marxism-Leninism and the thoughts of Mao Zedong and the leadership of the Communist Party.
In practice, this translated into focusing on the market over the planned economy, but doing so without resorting to shock policies or sudden changes.
From the deepest antiquity Confucius had said: “The rulers of the States and the heads of families are not concerned with scarcity, but with inequality in distribution;
they are not worried about poverty, but about instability.
Because when it is distributed with equity, there will be no poverty;
when harmony prevails, people will not suffer scarcity and when there is social stability, the country will not suffer the risk of protests”.
Judging from the evolution of China's economic transformations over the past 40 years, that remains a cardinal guideline for his leadership.
In this regard, the BFSU professor comments that this idea is not at odds with having fostered market relations, since it was done by admitting that a small number of people would get rich first, while others would gradually improve their standard of living, later causing a collective development.
For this, he says, the role of an "expanded market government" has been key, in the certainty that "there would be no economic prosperity without the rational use of political power", nor without it not ensuring "property rights clearly defined, highly respected contracts and not intervening in the market when it works well”.
Of course –he reflects–, now China has the challenge of adjusting the economic scheme and changing the development mode, because before it depended on the production of low added value and is moving towards offering products with high added value and with national intellectual property, also promoting innovation in the manufacturing sector.
Other challenges -he lists- are to have a more humane development of a society with a progressive demographic aging, the sustainable use of natural resources and the protection of the environment.
What would have happened if…?
Faced with the Chinese economic miracle, it is impossible not to wonder to what extent the close and extensive relationship that it established with several capitalist countries, especially with the United States, facilitated the advance of these reforms.
In this regard, Professor Li Ziying replies:
“The international scene always has influence, a negative or positive effect.
For example, the crisis in the United States in 2008 had a negative impact on the development and growth of all countries in the world.
We can never avoid these effects, but we can alleviate them, mitigate them.
"What does that mean?
In my opinion, for our development, each one of the experiences is very important, especially adjusting: adjusting the policy, adjusting the way of stimulating productive capacity.
Adjust the different policies in unequal aspects.
All according to the international scene.
Also according to the situation and, as Deng's phrase says, crossing the river touching the stones at each step and deciding what it would be, in what direction, and how to step on the next step.
(Taken from Newspaper 26)
(Taken from Newspaper 26)