I spent six years in China trying to make sense of the place only to realize that not even the people who run it understand where their leaky ship of a country with 1.36 billion people on it is going. All I could do is try to understand the course it has set for itself as it navigates its place in the world, and it is important to understand it because it may be the biggest boat out there.
Five Year Planning
China has some enormous obstacles to overcome in the next few years, the biggest being that they simply can no longer rely on being the world’s center for the manufacturing of cheap crap to drive their economy. The rise of even cheaper markets for manufacturing low end goods and the spread of automation threaten to sap the country of what had allowed it to grow so quickly over the last few decades.
But the people that run the country can see what is coming and have been doing everything they can to ensure China’s place in the future. Plans have already begun to try and turn China into a world leader in a number of key growth markets that will determine who runs the 21st century. At the heart of the most recent five year plan are the following goals. (taken from the wiki page on it)
- Innovation: Move up in the value chain by abandoning old heavy industry and building up bases of modern information-intensive infrastructure
- Balancing: Bridge the welfare gaps between countryside and cities by distributing and managing resources more efficiently
- Greening: Develop environmental technology industry, as well as ecological living and ecological culture
- Opening up: Deeper participation in supranational power structures, more international co-operation
- Sharing: Encourage people of China to share the fruits of economic growth, so to bridge the existing welfare gaps
Attached to the five goals are slogans, one of the few lasting relics of the communist era. These slogans get plastered on mountain sides and street corners all over the country and are often repeated by the various news organizations in China to serve as a constant reminder to the people of where the country is supposed to be going.
“Everyone is an entrepreneur, creativity of the masses” (大众创业，万众创新)
“Made in China 2025” (中国制造2025)
“Economy needs a Rule of Law” (建构法制经济)
All of which aims to address four worrying trends: (also from the wiki)
1. (Nationally) vital technologies lack a (domestic) core platform
2. Chinese industrial products are perceived internationally as inferior quality
3. Domestic industrial competition is fierce due to overly homogeneous structure
4. Poor conversion of academic research results to practical application
These cracks in China’s system are showing up all over the place. GDP growth has slowed and the RMB has devalued while pollution continues to soar and tensions continue to build with its various neighbors.
So how do they plan on actually addressing these problems? The answer is simple, they are trying to buy their way out. The Party controls more liquid cash than any organization on earth and they have started using that money to build new market opportunities for itself.
Alternative Energy – China is now the world’s largest producer of solar and wind power and plans to produce more renewable energy than the rest of the world combined. They even have plans in place to use all that energy to power the rest of the world.
Bio-Engineering – Already home to the largest genomics company in the world, China has now also become the world’s genetic laboratory and they don’t have a problem using their own people in science experiments to help position themselves as the global center for genetic engineering.
Technology – Chinese internet companies Tencent, Baidu and Alibaba are now among the largest in the world and invest heavily in R&D. Though often maligned as just a copy-cat league, the Chinese internet landscape is a robust and hyper-competitive space and has produced some truly innovative products. Facebook and Google dream of building a platform as multi-faceted and ubiquitous as Tencent’s WeChat, the world’s biggest everything app. The periphery also plays a key role as Taiwan and Hong Kong have become a global hub for Virtual Reality and Artificial Intelligence labs.
Infrastructure – More highspeed railways than the rest of the world combined, almost all of the 20 longest bridges in the world, the creation of a city with 130 million people. While infrastructure investment stagnates in most countries, China continues to build and build and build. Not to mention all the mega projects they are funding and building overseas.
Space + Physics – China has set itself a number of ambitious goals for its space program including being the first nation to land a person on the moon in nearly 50 years. They are also the only place in the world working on developing newly discovered EmDrive technologies, they recently completed work on the world’s largest radio telescope and they announced plans to build a particle accelerator that will be twice as large as the LHC.
Of course, they have to keep spending to keep the economy growing and their people employed, but eventually the money will run out and the leaders hope that these new industries start paying dividends before that happens. However there are two other factors that are also going to work in their favor going forward. One, they have managed to strategically place themselves as the world’s largest trading partner making them a key fulcrum in the global economy that the west should not want to upset. And two, their political system allows the rulers to actually focus on ruling rather than having to stop everything to run elections every two years, also allowing them the unique ability to actually plan for the long run.
Many in the west seem to believe that if we just give them enough time they will naturally gravitate towards democracy. The Chinese do not share this belief, for the most part the people are pretty content with how The Party runs things and the last US election certainly didn’t do anything to help sway them.
The Scary Stuff
The Party is tightening its hold over the people and has begun instituting a social credit system that brings to life the worst of George Orwell’s nightmares. The proposed social credit score will be a score based on each citizen’s activity online that measures how good of a citizen they are, how closely they adhere to the party line.
There is one thing The Party values above all else, stability. Since they took over the country in 1949 they have worked tirelessly to ensure that the masses in China accept their rule and never question their authority. They seem stronger than ever and now the digital age has given them the tools to make sure each individual is as stable as possible.
It is impossible to say what it will mean for the rest of the world and the future of humanity if China succeeds in all of its ambitious planning. But the rest of us should probably hope it works out and that a rising tide will continue to lift all boats because it might become more worrying if that boat suddenly starts to sink as it could careen violently of course.