Editor’s Note: the Communist Party of China (CPC) will hold its 19th National Congress on October 18th. On the eve of the 19th National Congress, The China Journal interviewed Hao Fuman, director of the World Bank’s China, Mongolia and South Korea Bureau, and asked him to express his views on China’s economic development and global leading role.
What do you think is the greatest achievement of China in the past five years? What is the most remarkable change?
I think China’s leading position in the international community is the most remarkable achievement. China stepped onto the world stage and played a leading role in major issues such as climate change. Without China’s participation, the Paris Climate Agreement could not be reached. The top leaders of president, China, attended the UN Summit and expressed their support for the UN sustainable development goals.
In international development, China also supports the World Bank and its agenda. China has also established its own institutions to enhance the development financing capacity of international financial institutions. Finally, China’s "One Road, One Belt" initiative is a very important plan, which can bring great benefits.
As an official of the World Bank, I think the action to eradicate poverty in China is the most important development in the past five years. We believe that China will achieve the goal of eliminating extreme poverty in rural areas by 2020. The global goal is to eliminate poverty by 2030. It will be great for China to achieve this goal in 2020, that is, 10 years ahead of the world.
What three words would you use to describe China today?
I want to use three "C’s", which are confident, competent and caring. I feel that China is very confident. It has dealt with a very difficult economic situation — — Global financial crisis, and achieved a soft landing and maintained stability while maintaining a high growth rate.
China is capable (another key word) because it is very difficult to combine monetary policy and fiscal policy. In the past decade, China has implemented structural reforms and achieved these achievements.
Finally, I use the word "caring" because it is an important feature of China’s economic policy to promote poverty reduction at home and advocate inclusive development internationally.
What is the biggest challenge facing China? How to overcome it?
The situation in China is already very good. Over the past 35 years, China has maintained an extraordinary growth rate, and it is a great challenge to maintain this growth. I (also) believe that the reforms proposed by the Third Plenary Session, the Fourth Plenary Session and the Fifth Plenary Session of the 18th CPC Central Committee are all moving in the right direction, but challenges still exist. The most urgent thing is to deleverage the economy and reduce the dependence of growth on credit.
Secondly, World Bank President Jin Yong emphasized three "D’s" at the "1+6" round-table dialogue. This includes not only promoting innovation and discovering new technologies, but also eliminating the remaining distortions in the labor, land and capital markets, so as to make more effective use of human capital and material capital.
Third, China’s per capita GNP is US$ 9,000, and it needs to catch up with the OECD countries’ per capita GNP of US$ 40,000. Accelerating the diffusion of existing technology and management technology will still be an important kinetic energy for China’s economic growth. It will be a challenge to find an appropriate policy balance so that all factors can play a role.
Can China’s experience and practices be used to solve pressing global problems?
A lot will do. I think the most important thing is the reform and opening up proposed by Deng Xiaoping. The second is that China did not blindly copy or introduce a certain model from abroad, but created its own model. The third is the emphasis on inclusiveness. Deng Xiaoping said, "Let some people get rich first", and these people did it. However, China has always been concerned about the social poor, so that they can also benefit from the reform. I think this is very important for social stability.
Countries that do not pay enough attention to this point have experienced more unstable stages, distracting the attention of reform and weakening the foundation of growth and development.
What will China be like in the next five years? What is the long-term future of China?
I think the first century goal will be achieved, and China will build a well-off society by 2020. In the long run, I see opportunities everywhere. Any emerging economy in the history of the world has experienced difficult times. In particular, it is necessary to continue to pay attention to the macroeconomic aspects to maintain steady growth, because this will be the biggest risk. Nevertheless, on the whole, China will be able to maintain high growth in the next 15 to 20 years — — This seems to be possible.
As a senior official of an important financial institution, which departments do you think will have the most development opportunities?
If you look at China now, you will find many new growth points. There are emerging factors such as service industry, information and communication technology and financial technology.
Finally, China still has a strong manufacturing base. Although its relative importance has declined, China is still the largest manufacturing base in the world. China also has an emerging middle class.
People will get richer and have money to spend. In my opinion, the successful departments and industries will be those that can serve and meet the needs of China and the emerging middle class.
In a narrow sense, it is of course housing, mobility and urbanization. Broadly speaking, it is entertainment, convenient service, agriculture and safe food. Therefore, any industry and sub-industry that can meet the needs of the rising middle class will succeed.
What opportunities will the Belt and Road Initiative bring to China and the world?
We in the World Bank welcome this very much. We are actively contacting with the (China) government and other World Bank member countries involved in this project to make it a reality.
We believe that strengthening the interconnection among economies along the "Belt and Road" is a great opportunity and can be an important driving force for global growth.
At the first "Belt and Road" forum, the views were quite consistent. We believe that with the participation of all countries, we will see the reform of trade policies, trade facilitation and customs procedures, making cross-border trade easier. We will also see the reform of the investment environment. There are great opportunities here.
China and other countries hope to invest in the areas along the "Belt and Road", and the investment environment will definitely improve. A lot of infrastructure will be needed, but the policy environment for infrastructure investment must be suitable. A lot of reforms are needed to promote the success of the "Belt and Road". In addition, infrastructure construction itself needs a lot of financing, which is one of the key areas of the World Bank and its international financial groups for private institutions. We are studying relevant policies, industry investment environment and financing.
What are your expectations for the 19th National Congress of the Communist Party of China? What key issues will you pay attention to?
I believe many ideas and policies will be discussed. But I think it is very important to reiterate the basic direction of reform — — That is, the reform direction put forward by the third, fourth and fifth plenary sessions of the 18 th CPC Central Committee and the goal of eliminating extreme poverty in 2020.
China Daily reporter Xin Zhiming Translator: Wang Liangliang