Wind turbines on the coast of Rongcheng (Shandong), April 22, 2024
In the Decision of the Central Committee of the Communist Party of China (CPC) on Further Deepening Reform in All Areas to Promote China’s Modernization, adopted on July 18 at the Third Plenary Session of the 20th CPC Central Committee, it is written that opening-up is a defining characteristic of China’s modernization.
The session made special arrangements for further opening-up. “We should stick to the basic policy of opening-up, rely on opening-up to boost reform, take advantage of our huge domestic market and enhance our capacity for opening-up in expanding international cooperation, so as to develop our new system of open economy to a higher level,” the document said.
Contribute to global development
Since the start of reform and opening-up 46 years ago, China has made considerable contributions to world peace and development through its own economic, technological, cultural and environmental development. China’s contribution to global economic growth averaged 38.6 percent from 2013 to 2021, surpassing the combined contribution of the G7 countries. China has the largest increase in forest resources and the largest area of artificial afforestation in the world, contributing a quarter of global greening over the past 20 years. The stable and healthy development of China’s economy further adds certainty to the uncertain world economy.
The contribution of the Chinese economy to the world economy is also measured qualitatively. It is the main engine of global economic growth and is widely recognized in the international community. In an opinion poll by the Academy of Contemporary China and World Studies in 25 countries, respondents highly appreciated China’s contribution to promoting global economic development, with over 93 percent of them believing that it is the result of its own development.
The Decision’s assertions that reform and opening up are a lifelong effort, that we should move forward faster to create a new development pattern, expand institutional opening-up and optimize the environment for opening-up and cooperation have been widely cited in the international press. Yu Jie, a senior fellow at Chatham House in the United Kingdom, said the Third Plenum has indicated the direction of China’s economic growth strategy for the next decade, marking a significant shift in growth model from pursuing nominal growth rates to building a resilient economy based on innovation, and pushing China to lead the global industries of the future.
Chinese home appliances attract overseas customers at the Canton Fair on April 16, 2024.
Chinese Modernization
China’s opening-up is not limited to China, it benefits the whole world. At present, global changes are accelerating, the world situation is in turbulence, protectionism is prevalent, and world peace and development are facing new threats and challenges. As the world’s largest developing country, China has not followed the path of some Western countries and has always been a builder of world peace, a contributor to global development, and a guardian of international order. Shakeel Ramay, director general of the Asian Ecological Civilization Research and Development Institute of Pakistan, believes that the Third Plenum has highlighted the world outlook contained in the development ideas put forward by General Secretary of the CPC Central Committee Xi Jinping. The goal of China’s path of modernization is multifaceted, encompassing China’s peaceful development, creating opportunities for the world, common prosperity, and win-win cooperation.
China adheres to the fundamental policy of opening up to the outside world and promotes high-level opening-up. General Secretary Xi Jinping has repeatedly stressed that China’s door of opening-up will only open wider and never close, and that “China will remain an important opportunity for the world’s development. Our door is wide open to anyone who wants to engage in cooperation with us.” The 2023-2024 Business Confidence Survey released by the German Chamber of Commerce in China shows that more than 90 percent of German companies surveyed plan to continue to expand into the Chinese market, viewing China as a vast and growing market. According to the Japan External Trade Organization’s 2023 Survey on Overseas Business Conditions of Japanese-Invested Companies, more than 90 percent of the surveyed companies chose “expansion” or “maintain current status” for the direction of their business development in China in the next year or two.
The idea that “China’s overcapacity is hurting the global market” is a complete fallacy. Building a “small courtyard with high walls” to protect against China can only lead to a “lose-lose” scenario. Is the global supply of renewable energy capacity greater than demand? The answer is “no.” Take electric vehicles (EVs) as an example. Most countries in the Global South are developing new policies in the automotive sector, fulfilling their climate change commitments, and promoting the use of EVs as an important means of reducing emissions in transportation. According to the International Energy Agency, global EV sales will reach nearly 45 million units in 2030, and demand for photovoltaic capacity will also increase significantly. China’s production is still far below global demand. What China provides to the world is advanced production capacity, not excess capacity.
Institutional opening
The Third Plenum provides an important opportunity for the international community to observe that China is promoting high-quality development and high-level opening-up in the new era. China will gradually expand its institutional opening-up and promote alignment with high-level international economic and trade rules. It will take the lead in expanding opening-up, improving high-quality cooperation mechanisms under the Belt and Road Initiative, and providing more opportunities for the world.
First, China’s institutional opening-up will continue to provide market opportunities. The overall goal of deepening reform in an all-round manner is to build a high-standard socialist market economy in all respects by 2035 and further improve socialism with Chinese characteristics. China enjoys the advantages of strong demand generated by its huge market as well as the supply side of a complete industrial system. According to Bloomberg News, China’s pursuit of high-quality, technology-driven growth has paid off, with GDP in high-tech sectors growing by an average of 12% between 2018 and 2023.
Second, China’s institutional opening-up will continue to provide investment opportunities. The Third Plenum stressed the need to “promote the agglomeration of various advanced production factors to develop new high-quality productive forces.” China will accelerate the establishment of a new dual-circulation development pattern in which domestic and foreign markets reinforce each other, with the domestic market as the mainstay. New high-quality productive forces enhance the endogenous driving force of domestic circulation and greatly enhance the overall competitiveness of China’s industrial development. With its high-level opening-up and in-depth participation in the international division of labor and global industrial cooperation, mutual promotion and progress between domestic and international circulation can be realized, thereby continuously developing a new pattern of human progress.
Third, China’s institutional opening-up will continue to provide growth opportunities. Throughout the history of human development, China has followed the right direction of economic globalization, injecting more certainty and positive energy into a turbulent and interdependent world. China will unilaterally expand opening-up to least developed countries, deepen the reform of its foreign aid system and mechanisms, share successful experiences gained on the path of modernization, and provide valuable references and lessons for other developing countries. “Give a man a fish and he will eat it for a day. Teach a man to fish and he will eat forever.” Many African countries have expressed their desire to seize the historic opportunity of China’s economic transformation and modernization, and become priority beneficiaries of China’s transfer of industrial and production capacity. China will boost economic growth through innovation in supply, share the gains of industrial progress, and promote the realization of global modernization featuring peaceful development, mutually beneficial cooperation and common prosperity.
*YU YUNQUAN is President and Researcher at the Academy of Contemporary China and World Studies.
