Chapter 16: The choices of the rest of the world
There is no doubt that China's urbanization has had and will have large impacts on the world economy. The future challenge is to figure out how the fundamental changes in the Chinese economy will change the world. Considering the large scale of China's urbanization, this is a new challenge the rest of the world has never before faced. There is big risk involved in having a relationship with China. Can the rest of the world shape a future with China in which everyone prospers? It depends on the foresight of the world leaders and their skills in dealing with China. Thirty years ago, when China started its reform, US leaders viewed China's reform as the fulfillment of a free-marketeer's dream: 'It is a lovely theory, and it may ultimately be true. There is, however, no evidence upon which to base such a prediction' (Fishman 2006, p. 283). The actual development in China has been quite different from what world leaders had originally thought it would be; also different from what Chinese people had thought it would be at the beginning of the reform. China has become a strange mixture of a controlled economy and a market economy. What lessons can we learn from the experience in dealing with China since China opened its door in the early 1980s? In the past 30 years, China has followed an export-oriented strategy and exported a large amount of cheap manufacturing products to the rest of the world.
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