Is This the End of China's Economic Miracle?-這是中國經濟奇蹟的結束
Ma Jijiang and his once poor family are the flesh and blood of China’s modern economic miracle, living proof of how radically the country has been reshaped since the late Deng Xiaoping changed the world in 1978 by proclaiming that to get rich is glorious and launching China’s experiment with market economics.
Ma grew up as the only son of peasants in central Henan province. In the late 1990s, his father, a factory worker, suffered an industrial accident that caused him to lose the lower half of his left leg to amputation, ending his working life. His mother, Hui-fang, was a wheat farmer, her skin coarsened by days working in Henan’s broiling summer sun. The family used to live off a dirt road adjacent to the wheat fields in which Hui-fang toiled, in a tiny wooden house lit by a single light bulb.
No longer. Ma was an uncommonly brilliant student, and when he took China’s famous (or, to its critics, infamous) college entry exam, he finished ahead of all the other students in his village. That earned him a ticket to Beijing’s prestigious Tsinghua University, known as the “MIT of China,” where he earned a degree in electrical engineering. That, in turn, led to a job at a company in Shenzhen, the bustling city that abuts Hong Kong, for a company that, back when he joined, few outside the country had ever heard of: Huawei. The year was 2001, and China was about to become a member of the World Trade Organization (WTO), formally rejoining the world trading system, and the global economy.
Today Ma still works at Huawei, as a senior engineer writing software. His parents moved to Shenzhen and live in a small but tidy apartment their son bought them shortly after he got his job at the company known as the Cisco of China. The value of that small apartment has skyrocketed since Ma bought it, as has the unit he bought for himself and the woman who is now his wife. From the day he took his college exam to the day he signed on at Huawei, it had been less than five years—and a poor family’s life has been utterly transformed.
Stories like that one are commonplace in modern China. They are the product of economic transformation and hyper-growth, China’s relentless charge from an impoverished, centrally planned economic backwater to the world’s second largest economy.
The era that brought the Ma family—and so many millions of others—from poverty to relative economic security is now over. With every new economic indicator released, it’s become clearer that the period of China’s hyper-growth has passed. The decades-long push into manufacturing, export-led growth, and real estate and infrastructure investment—which propelled growth for more than 30 years—has run out of steam. Furthermore, since the global financial crisis of 2008-2009, China has relied on massive infusions of credit to prop up its economy, and data show that the growth bang for the credit buck has diminished considerably. In 2008, banks had assets of roughly $9 trillion on their balance sheets. By the end of this year, according to Charlene Chu of Autonomous Research Asia, that will reach $28 trillion. Yet growth is decelerating sharply, likely to sink to 6.8 percent next year and 6.5 percent in 2016, according to the most recent forecast by Wang Tao, the chief China economist at UBS.
The Shanghai skyline illuminates the night sky. JOERG DICKMANN/GALLERY- 上海燈光照亮黑夜的天空
After years of double-digit annual growth, that’s a level that makes China’s leaders nervous. To the Communist Party of China, which has ruled the nation since 1949, social stability matters above all, and growth that falls too far below 7 percent could be dangerous for them. The prospect of young college graduates not being able to find jobs, or of poor farmers migrating to new urban areas only to be unable to find work, or of large firms going bankrupt, triggering layoffs, worries China’s leadership.
11/26/14
