The Chinese economic miracle.

Byline: Shahid Mehmood

IN the recorded history of humanity's economic affairs, there has never been as remarkable a story as that of China in the late 20th and early 21st century. By any count, it's miraculous. The numbers are staggering. No empire or country has managed to pull more than 70 million people out of poverty; none has achieved the sustained high growth rates that China has (10.2 per cent on average since 1980); none has managed to achieve the expansion of its economic pie by a multiple of 42 since 1979 (from $305 billion to $12.7 trillion) while witnessing an expansion of household consumption by a factor of 90 (from $49bn in 1980 to $4.5tr) and using more cement in three years (2011 to 2013) than the US did in the entire 20th century etc.

Until Mao's time, it was a relative backwater that nobody took seriously. But now, its GDP is set to surpass that of the US by 2030. What accounts for this transformation?

The material on this subject is extensive, books are in the hundreds and research papers in the thousands. One excellent analysis comes in the form of a book (Why has China Grown So Fast for So Long) by Dr Khalid Malik, who spent many years in China as UN rep. He shared his experiences during a webinar held by the PIDE under the same title. Important bits are reproduced here.

The Chinese growth experience has a social and cultural side. After Mao's disastrous 'Cultural Revolution', everybody came to agree that change they must. Deng Xiaoping acted as the catalyst in the form of his growth goals. Since that time, a shared work ethic is etched in the Chinese mind, ably perpetuated and supported by those who govern. This kind of ethic works well in unison with the aim of enhancing capacity to perform and grow.

The pursuit of long-term goals has never come at the expense of the private sector in China.

A critical feature of Chinese growth was the restructuring of the Chinese bureaucracy. Between 1982 and 1984, almost 65pc to 70pc of mayors/governors/administrators were changed by Deng with a younger, educated lot who had a better vision of the future. These changes helped in perpetuating strong ownership of reforms at the local, grassroots level. The Chinese civil service is now arguably the most competitive service in the world, with a structure ensuring that only the best get promoted.

There is also intense competition within the Communist Party. Unlike hereditary party politics in Pakistan, it's about discussion of ideas and...