CHINA AND THE WORLD FINANCIAL CRISIS

A Limping West Sees a Confident China
Sukant Chandan*

China returned back into the Western media spotlight this
last year. While the Western press went into over-drive in
its negative reporting of China in the lead up to the
awe-inspiringly successful Beijing Olympics over the Tibet
riots, at the same time people in the West could not
completely ignore the many impressive aspects of Chinese
society and government. Few could ignore the stark contrast
between the social and political system and leadership of
Peoples Republic of China and that of the West,
particularly the USA.

The Sichuan earthquake and its tragic consequences for the
Chinese people saw the swift reaction of the Chinese
government with Premier Wen Jiabao rushing off to the
earthquake epicentre minutes after it occurred, as well as
the massive mobilisation of the Peoples Liberation Army,
Communist Party and other social organisations in the
service of those affected. Many people have contrasted this
with Bush's cowardice when he flew thousands of feet in the
air above New Orleans after the floods and government
incompetence left many residents of the city, especially
the Black and working classes sure that their President is
not working for their interests.

China's holding of the most impressive Olympics to date was
soon followed by another historic achievement in being only
the third country in the world to have sent astronauts for
a space walk. Today China is showing that while the West is
quivering on an economic and financial precipice it is
distinguishing itself as economically calm and in control,
and furthermore confidently planning additional economic
and social development for its people.

The last thirty years or so has not only seen China
accomplishing great strides for its own people and nation
in terms of economic growth, but these developments have
also impacted internationally as statistics released by the
World Bank last year showed that in the last two decades
China accounted for 67 percent of the achievements in
global poverty reduction. Today China is playing a crucial
role in the world economy with Western leaders queuing up
to request money from its massive currency reserves to bail
them out from the current financial capitalist crisis.

China has made it clear that it is committed to
contributing to a stable world economy. However this does
not mean that China will necessarily be ready and willing
to bail out the West indefinitely, China has to think of
its own economic well-being. China's position is that the
best contribution it can make to the world economy is to
maintain its own strong and relatively fast growth. Indeed,
a strong and economically successful China means the rest
of the world; especially the countries of the South have a
major world economic trading partner in China that treats
them with respect and friendship.

China has shown its economic self-confidence in the last
few weeks while Western governments are running scatter
shot by the financial crisis. The Central Committee of the
Communist Party of China announced agricultural reforms
intended to double farmers' incomes by 2020, stating
further that "the country's overall economic situation is
good. The economy is growing quickly and the financial
sector is operating steadily. The basic momentum of the
country's economy remains unchanged".

There are many reasons why China will not suffer the same
economic fate as Western nations: at a time when there is
capital flight from the West, China experiences capital
inflows. Mortgage assets and the housing market in China
shows much greater stability and strength compared to the
very shaky and risky mortgages and lending set-up in the
West epitomised by the 'sub-prime' crisis. Amongst other
problems China faces difficulties from high energy costs
and pressure from inflation, but the country still has
massive untapped potential despite global uncertainties
because of its large working population and a vast domestic
market. China of course cannot remain wholly immune from
the adverse effects of the present financial crisis, but
vitally China is not at the mercy of modern-day capitalism,
indeed capitalism in China is at the mercy of the Communist
Party and the socialist system, and this people-centred
economic planning enables China to avoid that which is
taking place in the West.

The full extent of the political fall-out for international
capitalism in this Great Crash remains to be seen. Even if
it manages to limp away from this crisis, the crash the
next time will overshadow the current one, of this no
honest commentator can deny. However, in the midst of all
this people can learn from the positive lessons that China
demonstrates and not be taken in by the duplicitous
behaviour of many Western leaders as they on the one hand
mouth-off and encourage subtle sinophobic anti-communism
and then, as in the case of Bush recently, phone Chinese
President Hu Jintao asking for hand-outs.

Peoples and nations of the world, including in the West,
are interested in building an alternative international
economic order where development is under the control and
in the interests of the masses. This is a challenge which
is being taken up by countries from Venezuela to Vietnam
who believe in a truly multi-polar world, a world that has
no place for US hegemony and aggression or economic
precariousness. Nations and peoples of the world,
particularly those of the South are developing their ties
of friendship, trade and cultural exchanges with China.
Those involved in progressive cultural and social movements
in West may also want to develop a mutually respectful
relationship with a country which is putting into practice
on an enormous scale the principles of peace and social
progress in which we believe. As Malcolm X used to say in
the early 1960s when the US vetoed China's membership of
the United Nations, no-one can ignore 800 million Chinese
people who have stood up. Since then China has made many
strides and stands as one of the biggest allies for
progressive change in the world today; something which
today cannot be ignored. This Great Crash, as well as the
failed 'War on Terror' is teaching people across the world
in the words of a recent Peoples Daily editorial in China
that the financial crisis is a manifestation of the
dead-end of liberalism and the destruction of the myth of
all-powerful American institutions.

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*An edited version of this article appeared in the Morning
Star. Sukant Chandan is Chair of Friends of China and can
be contacted at sukant.chandan@gmail.com