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Why China Loves Globalization

Why is China’s President Hu Jintao upbeat about future economic and political reform?

June 7, 2005

Why is China's President Hu Jintao upbeat about future economic and political reform?

While many nations are increasingly wary of globalization, China’s President Hu Jintao has a very different perspective. As he lays out in this Globalist Document, China sees globalization as the key to economic development and securing a better future for its 1.3 billion people.

With surging economic globalization, China and Asia are quickly becoming a new growth engine for the world, while the global boom is also generating more important opportunities for China and Asia.

China is an ancient civilization with a history dating back over 5,000 years. The Chinese people have made a major contribution to human progress by creating the splendid Chinese civilization with hard work and ingenuity.

The city of Beijing, with its long history of over 3,000 years, stands testimony to that effort. It became the nation’s capital over 800 years ago.

A short distance from the Great Hall of the People is the world-renowned Forbidden City. First built some 600 years ago, the former Imperial Palace is the largest and most complete existing ensemble of ancient royal architecture in the world.

From Beijing’s time-honored past and the majestic Forbidden City itself, people can learn vividly the originality, greatness and profound richness of the Chinese civilization and feel for themselves the vigor, resilience and pioneering spirit of the Chinese nation.

Beginning in the mid-19th century, China was reduced to dire misery as the country suffered one humiliating defeat after another and the people languished in poverty and starvation as a result of brutal foreign aggressions and corrupt and incompetent feudal rulers.

Refusing to submit to a fate of agony and woe, the Chinese people fought back persistently and finally built up a New China under the leadership of the Chinese Communist Party.

Since 1949, when the New China was proclaimed — and particularly since the implementation of reform and the opening-up program pioneered by Mr. Deng Xiaoping in 1978 — China has undergone a profound transformation never seen in the country before.

In a short span of 26 years from 1978 to 2004, China’s GDP increased from $147.3 billion to $1.6494 trillion with an average annual growth rate of 9.4%. Its foreign trade rose from $20.6 billion to $1.1548 trillion, averaging an annual growth rate of over 16%.

China’s foreign exchange reserve increased from $167 million to $609.9 billion. The number of rural poor has dwindled from some 250 million to 26 million.

The overall national strength of China has increased remarkably and the quality of life of its people improved steadily. While inheriting and carrying forward their proud past, the 1.3 billion Chinese people are writing a new chapter in history as they march of one mind on the road of building socialism with Chinese characteristics.

We in China have identified the goal for the first 20 years of this century. That is to firmly seize the important window of strategic opportunities to build a moderately prosperous society of a higher standard in an all-round way for the benefits of our over one billion people.

By 2020, we will quadruple China’s GDP of 2000 to approximately $4 trillion with a per capita level of some $3,000, and further develop the economy, improve democracy, advance science and education, enrich culture, foster greater social harmony and upgrade the texture of life for the people.

We are deeply aware that China, for a considerably long period of time to come, will remain a developing country.

The population figure of 1.3 billion alone will make the fulfillment of the above goal a formidable challenge and we must be prepared for a long and uphill journey ahead.

To realize this goal, we must uphold the scientific approach in achieving economic and social development of the country.

We must put the people first, making the fundamental interests of the broadest masses of people our point of departure and endeavoring to satisfy their growing material and cultural needs to pursue the comprehensive development of man.

We must focus on economic development as our central task, making development our top priority and facilitating an all-round progress in economic, political and cultural aspects and in the building of a harmonious society.

We must stick to the direction of reform for a socialist market economy, step up institutional innovation, deepen reforms aimed at galvanizing creative vitality of society and increase the inherent dynamics for economic and social development.

We must adhere to our basic policy of opening to the outside world, building a more open marketplace and allowing the country to participate more broadly in international economic and technological cooperation and competition with still wider and higher dimensions.

We must follow a new course of industrialization, endeavor to overhaul the economic structure, quickly transform the ways of economic growth by improving its quality and efficiency, vigorously develop the circular economy and build a resource-effective and environment-friendly society.

We will thus blaze a trail of development characterized by higher productivity, comfortable life for the people and a sustainable eco-system.

We believe, as long as we firmly follow the path of development that is consistent with China’s national conditions, we will be able to realize our goal and play a greater and more constructive role in the promotion of world peace and common development.

China and the rest of Asia and the world at large are closely related when it comes to development. A developing China will, as always, generate cooperation opportunities with win-win results for other countries in Asia and the world over.

By the end of 2004, China had attracted a total of $562.1 billion in FDI, approved the establishment in China of more than 500,000 foreign-funded enterprises and created a huge import market of some $560 billion annually.

At present, most countries and regions have had enterprises with investment in China, and over 400 firms out of the Fortune 500 have invested in China. The number of R&D centers set up by foreign investors in China has exceeded 700.

As China becomes more developed, its cooperation with the other countries and their corporations of various types is bound to increase in scale.

China will keep opening up its market, find new ways of using foreign capital, improve legislation and regulations for encouraging and protecting foreign investors, revamp foreign economic management, step up protection of intellectual property rights and create an even better environment for trade and economic cooperation with the rest of the world.

Let us join hands and work together to contribute a greater share to world peace and common development.

Editor’s note: This essay is adapted from President Hu Jintao’s remarks at the Fortune Global Forum, on May 16, 2005.