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The World Can Change China - Bloomberg

BloombergThe World Can Change ChinaBloombergThe behavior of Chinese officials at last weekend's Asia-Pacific Economic Cooperation summit in Papua New Guinea, reportedly barging into the foreign minister's office to try to cut mildly critical language on trade from a final communique, seemed ...et plus encore »

Photographer: China Photos/Getty Images

The behavior of Chinese officials at last weekend’s Asia-Pacific Economic Cooperation summit in Papua New Guinea, reportedly barging into the foreign minister’s office to try to cut mildly critical language on trade from a final communique, seemed intended to signal that China won’t budge an inch on U.S. demands. Commerce Minister Zhong Shan has declared that those who assume Beijing will cave to President Donald Trump’s bullying “don’t know the history and culture of China.” As a matter of fact, they might understand it better than he thinks.

Although Chinese nationalists like to cite the “century of humiliation” China suffered at the hands of marauding imperialists to explain why it’ll hang tough now, the fact is that reform in China has rarely come about in the absence of a challenge from the outside world. At key moments in China’s history, external pressure has been the indispensable impetus to change.

This goes back far before China’s reform period began under Deng Xiaoping four decades ago. Toward the end of the last imperial dynasty in the 19th century, for instance, agitation by Christian missionaries helped liberate women from the practice of footbinding, a landmark in China’s tumultuous passage to modernity. Then, as now, the West was viewed as both a bully and a beacon. Foreign experts helped modernize the customs service. International executives in foreign-run treaty ports introduced contemporary ideas of factory production and accounting.

Deng was obsessively keen to emulate the West’s success, and foreign pressure spurred him on. In the international furor that followed the 1989 Tiananmen Square massacre, when foreign businesses fled China and the West imposed economic sanctions, hardliners tried to roll back his pro-market reforms. He stepped them up instead, and multinationals soon returned to a roaring economy.

The next big wave of liberalization came ahead of China’s entry to the World Trade Organization in 2001. Then-Premier Zhu Rongji used that event to drive a further round of marketization, artfully raising the specter of foreign competition to make painful adjustments in the face of conservative resistance. Tens of millions of state workers lost their jobs during Zhu’s era.

Even now, U.S. pressure has arguably triggered modest concessions, even if Beijing won’t admit it. For instance, China has made good on promises to lift the cap on foreign investment in automotive factories. It’s also acting friendlier to neighboring trade partners, including arch-foe Japan.

The key is China’s quest to be respected as great nation. Much as the Chinese elite may resent foreign lecturing, it pains them to see their country branded a recalcitrant in the eyes of the world.

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