Chinese business elite reveal China’s internal problems

By Joel Wong

China’s history spans over 5,000 years, marked by significant achievements and challenges. Once a global leader in governance, economy, and culture during the Agricultural Civilization Era, China began to decline after the British Industrial Revolution, particularly following the First Opium War in 1840. The fall of the Qing Dynasty in 1911 ended 2,000 years of imperial rule, and the Chinese Communist Party established the People’s Republic of China in 1949. Despite early political and economic struggles, China has undergone rapid growth since the late 1970s, becoming a global power.

A Chinese entrepreneur in his late 60s, however, expresses frustration with the current economic and political landscape. He highlights ten major issues, including:

• Widening Wealth Gap: While wealth inequality is common in capitalist societies, the friend’s concern is that recent economic stagnation has affected all social classes, not just the poor.
• Policy Instability: Economic policies are often implemented abruptly, disrupting industries like gaming and education, which creates insecurity for investors and businesses.
• Corruption: The friend notes that corruption becomes more noticeable when people’s standards of living stagnate. Both detrimental and tolerable forms exist, impacting economic health.
• High Social Governance Costs: An inefficient public sector, which is criticized for laziness, complicates governance, affecting the economy.
• Severe Environmental Pollution: Although China has improved on environmental issues, pollution from industry remains a concern, requiring ongoing efforts for better manufacturing practices.
• Lack of Government Transparency: Insufficient transparency in decision-making can lead to ineffective policies; however, too much transparency could allow outside influences to manipulate political decisions.
• Imperfect Legal Structure: The legal system remains underdeveloped, creating insecurity in business operations and investments.
• Underdeveloped Market Economy System: China is focusing on building a more self-sufficient economy, especially as global tensions rise.
• Insufficient Freedom of Speech: Government censorship is strict, limiting public discourse, though the friend acknowledges reasons for some governmental controls.
• Centralized Power System: The concentration of power creates risks during transitions but may also facilitate quick decision-making amidst external pressures.

The entrepreneur believes that most economic issues stem from global downturns and domestic challenges like the housing bubble’s collapse, compounded by geopolitical tensions. The speaker concludes that political stability is often tied to economic health, echoing a sentiment seen globally: when people are comfortable, they tend to be less politically active.

The speaker invites the audience to engage with the topic and share thoughts that can be relayed to the Chinese friend for further discussion.