Chapter 34 Section 3 Forecast at home and abroad

The views of international public opinion on China's economy often go from one extreme to another. In the 1990s, "China's food crisis theory", "China's bank bankruptcy theory" and "China's economic collapse theory" were popular for a while.Since entering the 21st century, the "China threat theory" has become very popular.In his book "The Clash of Civilizations and the Reconstruction of World Order", Samuel Huntington believes that "if China's economy continues to develop at the current speed in the next 10 or 20 years, then China will be able to rebuild its 1842 Hegemony in East Asia a few years ago".While the "China Threat Theory" was prevailing, various alarmist theories such as "China's Export Deflation Theory", "China's Economic Statistical False Theory", "China's Energy Threat Theory" and "China's Financial Crisis Theory" appeared successively in the world. thesis.It is undeniable that the international financial community may be biased against the Chinese economy, but the international uproar is partly due to ignorance of China.At the same time, China urgently needs economic soft power to grasp the right to speak on China's economic issues in the international financial circles.

Samuel Huntington believes in "The Clash of Civilizations and the Reconstruction of World Order", "Asia, the third largest economy, may have 4 of the world's five largest economies and 4 of the world's ten largest economies by 2020." 7. Asian countries could account for more than 40% of global economic output by then. Most economically competitive countries are likely to be Asian. Even if Asian growth slows earlier and more abruptly than expected, The impact of the growth that has taken place on Asia and the world is still enormous." Lee Kuan Yew, a veteran statesman in Asia, is known for his vision. He predicted in his autobiography "Lee Kuan Yew's Memoirs": "China is likely to realize its goal of becoming a modern economic power by 2050, and it will participate in world trade and international trade as an equal and responsible partner. Financial activities, and becoming one of the important members of the world. If it does not shift the two major development centers of education and economy, China has a good chance of becoming the second largest trading nation in the world. This is a vision of China for 50 years - modern, confident and a responsible great power.”

There is basically a consensus among foreign economic circles: in the next 20 years, if there is no major turbulence in China, then China's economic scale will exceed that of the United States and become the world's largest economy again.However, regarding the prospect of China's economic growth after 2029, domestic and foreign economic circles generally believe that it will gradually slow down.However, there is no clear estimate of how much the deceleration will be.Estimating China beyond 2029 requires a deep understanding of the "China Model". The most in-depth report is "China in 2020" published by the World Bank in 1997.According to the report, during the period from 1995 to 2000, China's GDP growth rate will slow down over time, to 5% in 2020.This World Bank report believes that there are three forces that will cause China's GDP growth rate to decline in the future: one is the demographic factor, that is, the growth rate of the total population will slow down, and the working-age population will no longer increase by 2020; the other is that with capital accumulation, The economic law of diminishing returns is at work; third, as the economy matures and the efficiency of resource allocation increases, the impetus provided by structural changes for growth is decreasing, including the transfer and allocation of surplus agricultural labor.The report predicts that the momentum of China's technological progress will tend to slow as it narrows the technological gap with other countries.The report also predicts that by 2020, China may be the world's second largest importer and exporter; the purchasing power of its residents may exceed that of the whole of Europe; in the world financial market, as a provider and user of capital, China can compete with most Competing with industrial countries, China's GDP will greatly exceed that of the United States in 2020.

Regarding the rise of China in the 21st century, Justin Yifu Lin believed as early as 1998: "China's economy began to reform and open up at the end of 1978, and only then embarked on the same rapid growth path as Japan and the four Asian tigers. In 1978, China's technological level The gap with developed countries is far greater than that of Japan in the 1950s and the four Asian tigers in the 1960s. If the technological gap with developed countries can be used to enable Japan and the four Asian tigers to maintain rapid growth for nearly 40 years, Then it should be possible for the Chinese economy to maintain rapid growth for nearly 50 years just by taking advantage of this technological gap. Moreover, in the 1970s, China had more low-value-added agricultural population than Japan in the 1950s and the Asian Tigers in the 1960s. Resources There is great potential to transfer from low value-added industries to high value-added industries; at the same time, China's capital accumulation rate is as high as about 40% of GDP every year, which is one of the highest in the world. These factors indicate that China has great potential for development, at least There can be 50 years of rapid growth. From the reform at the end of 1978 to 1998, it was only 20 years, so it should be possible for China to maintain rapid growth for another 30 years or so.”

In 2003, Maddison made a conservative estimate of China's future based on purchasing power evaluation indicators.He assumes the following conditions: first, the growth rate of labor input is relatively slow; second, the growth rate of education level has slowed down; third, the growth rate of capital stock per capita will not exceed 5%; fourth, the growth rate of total factor productivity will also be Slowed down a bit.Under the above assumptions, he predicts that the average annual growth rate of China's per capita GDP will be 5.6% before 2010, about 4.6% between 2010 and 2020, and about 3.6% between 2020 and 2030.Per capita income in 2030 will be at the level of Western Europe in 1990 or Japan in 1986.By 2015, China's total GDP will surpass that of the United States, accounting for about 15% of the world's total GDP, and become the world's largest economy. By 2030, China's total GDP will account for about 25% of the world's total GDP.Maddison predicts that China's economy will enter a stage of slow growth after 2030, or even experience long-term stagnation. His implicit assumption is that China can only catch up with the world's technological frontier, but has no ability to lead the technological frontier.

UBS Asia-Pacific Chief Economist Anderson believes that although China is playing an increasingly important role, its imminent impact on the world economy will be much more moderate than the current popular saying.In general, here are 7 reasons why China will not change the world: 1. China will not rewrite the growth history of the world economy; 2. China will not swallow the world's manufacturing industry; 3. China will not buy up the world Financial assets; 4. The RMB will not become the next world currency; 5. China will not become the source of deflation in the world market; 6. China will not cause other developing countries to stagnate; 7. China will not destroy " Washington Consensus".

In May 2009, Paul Krugman, winner of the 2008 Nobel Prize in Economics, delivered a speech titled "Global Economic Recovery and China's Opportunities" in Shanghai and Guangzhou.He believes: "The global economic crisis will continue for 2 to 4 years. Since China's share of the world's GDP is not so large, China has no way to lead the world out of the economic recession, and has no way to become the locomotive of the world economy. China can show a way, but China There is no way to create enough opportunities for the whole world to recover. It will take 20 years for China to become the largest economy in the world. ... I would say that when it becomes the main currency of the world, it will be decades In the future, I may not be able to see it in my lifetime. It will take time for the renminbi to become an international currency, and this currency needs to be widely used by third parties.”