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China, the unstoppable locomotive of growth

By Seddiq Hussainy

China has been a genuine example for the world, particularly the developing Asia, in orchestrating an unprecedented rapid economic growth and accomplishing the excruciating task of dealing with extreme poverty.

China’s profound transformation due to flexible and vigorous economic policies has helped uplift lives of more than half a billion Chinese since mid 1980s. In fact, it has helped lift more people out of extreme poverty than elsewhere in the world.

The world’s most populous country has been reducing this menace by 10 million people a year and it intends to uproot entire poverty by 2020.

Decades of economic development have had a large role in boosting living standards of Chinese and ultimately alleviating poverty, which has been an important part of China’s leap forward. Economic boom fueled an incredible tenfold increase in China’s per capita income from $200 in 1990 to $8000 plus in 2018, moving China into the ranks of middle-income countries.

China’s per-capita income witnessed a remarkable increase as economy began to flourish since the outset of far-reaching economic reforms in the late 1970s.

Economic revolution can be attributed to a mélange of factors including a protracted period of economic growth, which per se drove a rapidly expanding labour market, and introduction of urban subsidy and rural pension.

Urbanization also is driving economic development. China’s extraordinary economic boom has gone hand-in-hand with urbanization which increased in speed following the initiation of the reform and opening up policy. In 1950, 13% of Chinese lived in cities. By the end of 2017, almost 60 percent of its total population lived in urban areas. Figures reveal that there are currently 15 megacities and twenty-five of the world’s largest 100 cities are in China.

Two and half decades ago, China had many characteristics in common with the rest of developing Asia: large population, low per capita income, and resource scarcity on a per capita basis.

Sustainable economic growth has for the most part been driven by the rapid industrial development. China has catapulted itself to take the position of a manufacturing country with an ever-galloping capacity to produce almost every merchandise the world markets need. Although, the country had relied for decades on heavy industry such as coal and metals, China moved away from heavy industry, and moved into light industry such as producing consumer goods for the world market.

China has seen remarkable growth in other sectors too. Construction, technological advancement, finance, and energy sectors boomed.

China’s industrial growth has been driven by the much-touted open door policy, which refers to trade liberalization and opening up to direct foreign investment. China improved its human capital, opened up to foreign trade and investment, and created a better investment climate for the private sector.

China has made the jump from an agrarian economy over to manufacturing. The far East country can undeniably serve as an indispensable example for most of the developing Asia. Afghanistan would also do well once it draws lessons from the rising China.

Afghanistan can be a recipient of China’s decades-long fight against poverty. Afghanistan is facing poverty and a staggeringly low per-capita income – the very same challenges that haunted China four decades ago. The country’s population may not surpass 30 million, most of which are young and dynamic. There is a growing number of educated young generation but with no employment vistas in sight. China can help Afghans master the nuts-and-bolts of economic growth and poverty alleviation by investing in agriculture and light industries. That is also a solution to lethargic job market and would vastly help in reducing poverty.

Trade and business with other countries is another remedy to the ailing economy. China has inadvertently provoked Afghanistan to follow it’s footsteps in broadening trade with the rest of the world. Since a few years, the country has emulated China’s module of ‘opening up policy’ by launching air trade corridors with many countries including China itself, Russia, United Arab Emirates, India, Turkey, Saudi Arabia, Indonesia, Italy, Finland and other European nations.

Afghanistan is now pinning high hopes on these air corridors to expand its trade. These routes have the potential to offer the landlocked country emancipation from the shackles of economic stagnation, helping it to retain a grip on its vast potentials.

But the country is burdened with internal conflict, political rivalries and outside pressure, which calls for a more concerted contribution from China to tackle these evils.

As China is propagating its win-win cooperation doctrine across the globe, Afghanistan can play an extraordinary role in its ambitious Belt and Road project. Taking into consideration the country’s geographical location, the country can offer China the easiest route of transport to Central Asia and Europe.

The writer is currently in China—he works as sub-editor to Afghanistan Times.

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