Jonathan Fenby: Trapped under the Great Fall of China
We will all be winners if Beijing bows to market forces, but China faces a choice between top-down control and dynamic capitalism, writes Jonathan Fenby
Published 29/08/2015 | 02:30
For 35 years, China has played a Marxist-Leninist-capitalist game. Following the model laid down by Deng Xiaoping when he launched partial economic reform at the end of the 70s, it has tried to use market forces to introduce reform, while retaining the top-down control beloved of Communist parties.
Now the time is fast approaching when the leadership in Beijing has to make a choice, or risk being caught in a middle-development trap that would thwart its ambitions to rival the United States on the world stage.
Its decision will have a global impact, including on Europe; if China becomes more economically liberal and open, it will be good for exporters to the world's second-biggest economy. If the Communist leadership fails to reform, it could make the People's Republic a more awkward partner that is less able to contribute to the growth the world needs.