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Economic Watch: What does modernizing China's economy really mean?

Source: Xinhua| 2017-10-24 16:27:46|Editor: Mengjie
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BEIJING, Oct. 24 (Xinhua) -- Catchphrases of China's economy have changed with the time, the latest one being "developing a modernized economy."

When outlining objectives for the next five years and beyond at the 19th National Congress of the Communist Party of China (CPC), Xi Jinping spoke of a new vision of development and a modern economy for a new era.

What does this actually mean for China and the world?

A modern economy is an urgent requirement for a smooth economic transition and a strategic goal, according to Xi's report delivered at the opening of the congress. It will be achieved through supply-side structural reform, innovation, a socialist market system and opening up.

The need for a modern economy is clear in the contradiction between unbalanced and inadequate development and the people's ever-growing needs for a better life.

In the past, the contradiction existed between the ever-growing material and cultural needs of the people and backward social production.

Wang Xiaoguang of the Chinese Academy of Governance said that while the economy had fulfilled people's basic needs, it must now provide a better quality of life.

Hu Angang, director of the Center for China Studies at Tsinghua University in Beijing, said a modernized economy serves the Chinese people. It carries strong socialist characteristics.

In September, the China National Offshore Oil Corporation opened a large oil refinery in Huizhou in south China's Guangdong Province.

Chen Yiwei, Party secretary of Huizhou and a delegate to the congress, said that for his city, a modern economy would mean breathing new life into traditional industries, the new refinery plant being just one example.

Xi spoke of standing at a pivotal point in the transformation of the growth model, with improved economic structure and new growth drivers, but a modern economy also means making China into a country of innovators.

Xi highlighted the importance of research in science and technology and strengthening applied sciences.

In the first three quarters of 2017, cellphone shipments by Huawei exceeded 100 million, up nearly 20 percent from a year ago. Sales revenue rose over 30 percent, almost on par with Apple and Samsung.

Yu Chengdong, CEO of Huawei's consumer business group, said that on the back of strong research, Huawei is confident of making more products for high-end users.

More opening-up is also imperative. A negative list approach will be applied across the board, significantly easing market access and protecting the rights and interests of foreign investors.

Harley Seyedin, president of the American Chamber of Commerce in South China, said there used to be a lot of uncertainties. People were worried and did not invest too much.

"But all of those uncertainties seem to be going away at this point and I think with the 19th CPC congress, we'll have a very clear map and direction for what is going forward," he told Xinhua.

"China has made great progress over the past 30 years, but it is just the warm-up. I expect China to continue its growth and make a great contribution to the world, economically and politically, and help people improve their lives around the world," he said.

Liu Zhiqin, a senior fellow at the Chongyang Institute for Financial Studies with the Renmin University of China, said opening up had been critical to China's growth for three decades and foreign capital had helped the country learn about market mechanisms, enabling Chinese to go out and do business around the world.

As the United States closes its doors and withdraws from free trade agreements, China is further opening up its market and embracing economic globalization to confront the "America First" stance, Liu argued.

When developing a modernized economy, China will become deeply intertwined with the rest of the world. An open China will have far-reaching significance for the global market and manufacturing, said Wang Jun, a researcher at China Center for International Economic Exchanges.

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