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The continued economic growth in China in the coming decades will create enormous opportunities for other countries, especially those in Asia, instead of threat to them, as China will provide a still broader market for them and create the conditions for them to upgrade their industrial structures, said prominent Chinese economist Lin Yifu.
Lin, who is in Beijing to attend the first session of the 10th National Committee of the Chinese People's Political Consultative Conference (CPPCC), which opened Monday, told Xinhua that facts over the past years have proved that China's economic growth has stimulated the growth of the world economy as a whole and such a rapid growth will continue into decades to come.
In an exclusive interview with Xinhua, the prominent economist gave the lie to such fallacies as "China poses threat to other countries" and "China's economy is about to collapse." He also tried to ease the worries that the increased export of products made by cheap labor would squeeze the market shares of other countries.
China's labor is cheap indeed, said Lin, but its labor productivity is low, too. The wage level of China is barely 1/50 that of the United States and Japan while its mean labor productivity is only 1/25 that of the United States and 1/26 that of Japan. This means that the wage cost required for creating one dollar of value in the United States is only 1/3 higher than in China.
Then, China's export enterprises are chiefly doing processing, Lin continued. The increase in export will require corresponding amount of imports, that is, for every US$100 of export increased, it requires US$50-70 worth of imports. Besides, Sino-foreign joint ventures play a big part in China's export. "Such pattern of export and import is, no doubt, beneficial to other countries," Lin Yifu stressed.
The big increase in foreign direct investment in 2002 does not mean the diversion into China of the foreign direct investment bound to other Asian countries, said Lin. Instead, that is the result of the big increase in the movement of private capital in the world. In fact, the proportion of the influx of foreign direct investment into China in the total foreign direct investment that has flowed into Asia as a whole has remained stable ever since 1993, the economist said.
Besides, the capital that flows into China mainly comes from Hong Kong and Taiwan while the capital that flows into the ASEAN countries mainly comes from the United States and Japan, Lin noted, adding that this is still what it is today.
"All these facts show that China's development has not been realized by snatching away foreign direct investment from the hands of other countries," economist Lin Yifu stressed.
(Xinhua News Agency March 4, 2003)
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