Китай и экономический потенциал

China’s future economic potential hinges on its productivity. Can the government boost it?

In 2010 China was home to fewer than 50,000 industrial robots. Today it has 800,000—nearly one in three of the robots in the world. This is in part because robots are cheaper than they used to be, and more capable. But it is also because, as China has grown wealthier and older, wages have increased a lot.

Companies are always in pursuit of such ways to increase productivity. Countries in search of economic growth like them, too. Xi Jinping, China’s president, has made productivity a priority.

In some respects, the ambitions of Mr Yi and Mr Xi seem well aligned. But many observers believe that Mr Xi is relying too little on the market forces which have shaped Mr Yi’s investments and too much on state power.

Economic growth depends on just three basic factors: how many people are working; how much capital they have at their disposal; and how productive they are. China’s turbocharged growth over the past four decades was the result of all three factors coming together at full pelt.

Some of this slowdown simply reflects the move from catch-up to caught-up. Developed countries have lower potential productivity growth. But many analysts also think that China’s economic model is particularly wasteful, a failing evidenced by its surging debts. Nowadays it adds about four yuan of new debt for every additional yuan of gdp; a decade ago it needed just two yuan of debt to get the same result.

The World Bank calculates that, since 2008, China’s total-factor productivity (tfp)—the amount of gdp growth that cannot be explained by capital or labour—has grown by just 1.1% per year, less than a third the rate of the previous three decades.

Основная цель для Китая, которая заложена в программе (пятилетке) “Made in China 2025”, культивировать все необходимые товары у себя, независимо от поставок с США и Европы.

Вопрос в экономической философии Китайских лидеров. Они верят, что от индустрии идет продуктивности и всячески ее поддерживают.

China’s leaders have long regarded industry as more economically valuable and more strategically useful than services. Whether the services in question consist of waiting tables or creating financial derivatives hardly matters.

Now, manufacturers are using applications on their mobile phones, letting them collect, analyse and act on data in real time. “They are becoming the most flexible companies in the world,” he says. The country hopes that it can enjoy a late-starter advantage in digitising industry, in the same way that it leapfrogged from being a cash-dominated economy to being the world leader in mobile payments.

At the same time, it knows that bigger urban agglomerations, which allow for specialised labour and interwoven supply chains, tend to be more productive.

The second part of the productivity push is better urbanisation: bigger agglomerations to which workers have better access. China has capped the size of its biggest cities, fearful that they might become unmanageable.

As well as joining cities together, it is also blanketing them in 5g mobile networks, planting sensors galore in their highways and sewers to monitor performance, and studding their lampposts with surveillance cameras. The party believes all this will allow the distributed mega-cities to be managed with a precision and efficiency which makes them paragons of hyper-productive modernity. This may betray a lack of insight into what it is that really makes cities hives of innovative oomph.

The last of the three categories of productivity enhancement is what might be termed catch-up reform: a series of changes to bring the country closer to the standards of richer countries, albeit in a dramatically different political context. The higher-education system is testament to the potential gains. It is easy to point to problems that still bedevil China’s schools, from too much emphasis on test preparation to too little investment in rural students. Yet the increasing number of university graduates—46m in 2000, 218m this year—is a good proxy for large, continuous improvements in workers’ skills.

Another critical area of reform is allowing failure. One of the main ways to ensure that capital is allocated well is to let bad firms go bust; Mr Cai has cited evidence that firms going under drives as much as 50% of productivity growth in rich countries. In corporate China this form of creative destruction has often been suppressed. Over the past few years, though, bankruptcies have soared.

Will China’s productivity policies actually work? History offers little by way of precedent. Autocracies have become successful industrial nations before, if never on such a huge scale. But it is not obvious that they can move beyond that. China is currently at roughly the same income level that its two closest Asian forerunners, South Korea and Taiwan, were when they became democratic and strengthened their independent legal institutions—a transition which, in retrospect, seems to have been essential for governing their increasingly complex economies.

Li Daokui, a former adviser to the central bank, is confident that it will eventually succeed: “We are not the Soviet Union. We have the world’s largest contingent of young engineers. If pushed, we will develop our own technology.” Perhaps. But it will be expensive, both in terms of the direct cost and other spending priorities forgone.

Less funding for pension systems, for example, will hold back consumption, thus holding back investment and productivity in the services sector. According to s&p, a credit-rating agency, a full-bore pursuit of self-reliance could lop as much as one-third off China’s growth this decade. But Mr Xi is unlikely to be swayed. He seems to believe that truly ambitious technology investment, though it may often fail, offers the possibility of world-beating breakthroughs that will bring his country both power and productivity.