Key directions of Chinese economic growth strategy

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Department of Foreign Languages Moscow State Technological University «STANKIN»

Key directions of chinese economic growth strategy

Karelina Е.А., Candidate of Economic Sciences Associate Professor

Russia, Moscow

Abstract

The article analyzes the Chinese economic strategy, as well as the strengthening of liberalization in economic activity. The influence and role of China's leadership in shaping economic growth strategy has been identified.

Key words. People's Republic of China, global economy, economic growth strategy.

The idea of reforms and open policy, as well as the priority of economic construction was formed in China as early as the 1950s. [1]. 1975 is considered the beginning of the formation of the main ideas of Deng Xiaoping and testing them in practice. In December 1978, the third plenum of the 11th CPC Central Committee was held in Beijing. The plenum set out to carry out "four modernizations".

According to Deng Xiaoping's theory, economic reform is impossible without any reform of the political system. The political-ideological superstructure is characterized in his theory as the dictatorship of the proletariat under the leadership of the Chinese Communist Party. The political life of the country was built in accordance with Deng Xiaoping's "four basic principles": follow the socialist path, adhere to the dictatorship of the proletariat, the CPC leadership and Marxism-Leninism, and the ideas of Mao Zedong in order to ensure the main internal condition for the normal course of reform - political stability. No deviation from this line in the direction of political and ideological liberalization was allowed [2]. economic strategy liberalization investor

The ruling party, being the guarantor of social and political stability, without which it is impossible to successfully pursue the course of modernization, is given special importance both in the reform of the political system and in the modernization process as a whole; therefore, issues of party building , strengthening party discipline and strengthening internal party control are constantly in the focus of the CPC leadership [3].

The process of modernization is ensured by strong state power, the rejection of one-step all-encompassing price liberalization and rapid privatization of the public sector of the economy.

In 1997, the 15th Congress of the CPC included a provision on the leading role of "Deng Xiaoping's theory" at the initial stage of socialism in the Party Charter. It is seen as a new stage in the development of Marxism in China, the second theoretical achievement in China after Mao Zedong's "ideas" of a scientific system of socialist construction with Chinese peculiarities [4].

In 2000, China's GDP was already $1,192.8 billion. The Chinese economy produced nearly $12 trillion worth of goods and services in 2017. China's gross domestic product has increased 15-fold over the past 30 years and has become the world's second-largest in terms of nominal GDP, inferior only to the U.S. [5].

The construction of a market economy in China was led by the Communist Party on the basis of five-year plans, almost like the Soviet Union in its heyday. Like the USSR, China has achieved impressive results. Today, China is a leading economic power with enormous scientific and technological potential, as well as nuclear weapons and an army that is the largest in the world in terms of number of soldiers. By 2007, more than 130 car companies had been built in China, producing a total of more than 90 brands and 260 car models.

Under the conditions of liberalization of foreign economic activity, the transformation of the model of investment cooperation between China and foreign countries has a significant impact on the evolution and condition of trade and economic cooperation between Russia and China [6].

The government pays close attention to the development of technologies and industries that support advances in energy efficiency, environmental protection, next-generation telecommunications, biotechnology, alternative energy, advanced materials etc. [7].

In addition, the CPC Central Committee proposed that Xi Jinping's theoretical provisions on a new era of socialism with Chinese peculiarities be included in the country's constitution. It is proposed that the text of the country's constitution be amended to state that "the leadership of the Communist Party of China is a hallmark of socialism with Chinese peculiarities”. Also among the amendments is the phrase about "building a community with a common destiny for humanity" and a provision to pursue the path of peaceful development with mutually beneficial and open strategies [8].

In the face of the new demands of the new era and the new challenges, the creation of party and state bodies and the distribution of their functions are not yet fully consistent with the requirements to implement, through unified planning, the overall scheme of five-year building (economic, political, cultural, social and ecocivilization) and the coordinated implementation of the four -dimensional strategic concept (comprehensive construction of a middle-income society, comprehensive deepening of reform, ensuring the supremacy of law and comprehensive internal party management).

The June 14, 2018 meeting of the State Council of the People's Republic of China identified import expansion measures that would help rebuild the industrial structure and balance foreign trade, and bring more benefits to the country's people [9].

The Chinese government is paying serious attention to expanding imports. Speaking on the work of the government, Premier Li Keqiang of the State Council of China said that China was going to actively increase imports and reduce import duties on cars, on some consumer goods for household use and other goods. «"We are ready to give more openness to the Chinese market in order to stimulate the modernization of industries, ensure balanced trade development, and thereby give consumers more choices," he stressed in his statement.

In 2014, the Chinese government announced several initiatives that were supposed to help intensify China's foreign investment in the infrastructure sectors, including the 'One Belt - One Road' (OBOR) Economic Belt and the establishment of the Asian Infrastructure Investment Bank (AIIB). These programs appear to promote China's investment in overseas infrastructure over the next ten years [10].

During the crisis, additional opportunities were created to increase the activity of Chinese investors abroad. When buying assets in foreign countries, economic policy was mainly focused on getting quick access to sources of raw materials, as well as control over foreign high-tech enterprises in various industries, which were in a difficult financial situation. In addition, an important policy goal was to strengthen the position of Chinese enterprises in those foreign markets for goods and services that were of fundamental importance to them [11].

Regarding the regulation of foreign economic relations, the Ministry of Commerce developed the "Foreign Investment Management Regulations" in 2000, which were revised in 2014 and encourage the export of capital and cross-border takeovers by domestic companies. China's strategy for entering foreign markets is to "promote overseas investment and facilitate cooperation with companies of Chinese origin outside China.” About 8,500 Chinese investor companies have real support from the government, which not only allocates large funds to stimulate investment expansion in foreign markets by state-owned corporations, but also consistently liberalizes the conditions for the export of capital.

In the course of the reforms, the government pursued a policy of extensive support for the peasants, which was aimed at improving their standard of living. Thus, peasants were completely exempt from paying tax on the slaughter of (Uo)

livestock, agricultural tax and the tax on special products. The peasants were allowed to sell a certain part of their agricultural products on their own. Special subsidies for farmers were also identified, including subsidies for the purchase of agricultural equipment. Subsidies to grain producers also increased. A policy of purchasing (minimum) prices for major crops was introduced. In some areas, state order systems were formed that involved a guaranteed purchase of crops at guaranteed prices. Loans to peasants and non-repayable aid mechanisms were greatly simplified. Agriculture in the country is becoming an increasingly oriented industry, and according to the government's plans, the country should become the world's leading force in agricultural science, even in the face of natural resource shortages and climate changes. It was the focus on the implementation of scientific and technological policy in the agricultural sector that allowed to increase the contribution of innovation in the economic growth of the industry from 27% at the beginning of reforms to 55% at present.

Conclusions

In the long term, the emphasis in the transformation of Chinese socio-economic development strategy will be on achieving the world average level of urbanization, completing the construction of a socialist economy with Chinese peculiarities, " also on creating mature economic institutions and achieving the level of the developed world on the level of technological development. The Chinese government and the CPC play a major role in shaping and implementing China's economic development strategy.

References

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