China going all-out despite US protectionism

Listening to President Xi Jinping address a gathering of top global leaders, including UN Chief Antonio Guterres and IMF boss Christine Lagarde, at the 2018 Boao Forum for Asia (BFA) was a moment of inspiration as I heard a leader determined to steer the course of history toward global sustainability and a shared development.

The speech was exemplary of the Chinese people’s deftness to reinvent the wheel, as President Xi outlined policies that seek to embrace the world as against the recent heavy-handed tariffs imposed on China and other allies by the Trump administration.

While urging developed countries to stop imposing restrictions and relax export controls on high-tech products to China, President Xi expressed China’s unflinching determination to build world peace, contribute to global prosperity and uphold the international order.

If there is any point in time or history that the rest of the world should fully embrace China’s ideals for a shared future as espoused by President Xi, in the country’s march forward through for example the Belt and Road Initiative, to share its success and prosperity along the road, then this is the time. The time has come for the global community to rally behind China in the fight against the forces of protectionism and isolationism. And just as the IMF Managing Director expressed while praising President Xi in her address, the world needs innovation and inclusiveness.

In President Xi’s words “humanity has a major choice to make between openness and isolation and between progress and retrogression”. To be circumspect in my analysis I would say, a trade war is brewing, “guns have been loaded”, but shots not fired yet. The future of the global economy would be determined by the choices made by those entrusted with the power to promote either a shared global development or isolation.

From President Xi address, it is clear that China has taken its stance, that it will not threaten anyone else, nor attempt to overturn the existing international system, or seek spheres of influence, no matter how much progress it makes in development. That China will significantly lower the import tariffs for vehicles and some other products this year and work hard to import more products that are competitive and needed by the Chinese people. These game-changing policies and others have been widely supported by global figures, including former UN Chief and Chairman of the BFA Ban Ki-moon who said he is personally inspired by China’s commitment to further open up.

Ideally, this is the perfect time for other developing countries in Asia, Africa and around the world to strategically position their economies to take full advantage of the new policies outlined by President Xi. It is obvious and clear by now that after four decades of opening-up and reforms of the economy, China’s leaders are preparing the country for the final take-off. These new policies, I believe, are coherent with the Made in China 2025 development plan which seeks to significantly reduce barriers and welcomes foreign enterprises to operate in China. As President Xi said, “We will pay equal attention to 'bringing in' and ‘going global’, and break new ground in opening China further through links running eastward and westward, across land and over sea.”

By taking these bold steps, China has shown maturity in the face of antagonistic policies from global powers who have taken resolute steps to suppress the sustainability of the global economic order to their advantage. China has proved that it will not shed its responsibility as a global leader. These policies are an indication of China’s resolve to contribute in the harmonization of the current global economic order in a more balanced and sustainable manner.

At the 2016 Davos Forum, there were predictions that China was heading for a hard landing, and notable among them was the comment from hedge-fund billionaire George Soros, who said “A hard landing is practically unavoidable in China.” Well, two years down the line, we are still to witness that unavoidable hard landing. He might have made a point looking at the uncertainty at the time, when in August that year China devalued its currency in relation to the US dollar, causing the Chinese economy to slow and the subsequent lower interest rates and a large amount of bond float. Moving forward, China is poised to galvanize its economic muscle and along with it rally the world unto a more sustainable future.

To allow domestic and foreign financial firms in China to compete on equal footing, expand the business scope for foreign banks, and a firm commitment not to devalue its currency to counter trade tensions as announced by Yi Gang, governor of the People’s Bank of China, I can boldly say that the take-off has began.

The author is a former Ghanaian Journalist.