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China rewriting development blueprint, trade expert says

BusinessCompaniesChina rewriting development blueprint, trade expert says

A senior fellow at the Washington-based Institute for China-America Studies, Sourabh Gupta, recently made a bold claim about China’s infrastructure development. He stated that China has formed a virtuous cycle in its infrastructure development and is re-writing the blueprint for infrastructure globally. According to Gupta, China is in the midst of transitioning from an emerging economy to an advanced economy and its infrastructure is a major factor in this transformation.

China’s infrastructure is “first-rate” and “the best infrastructure that there is in any advanced society,” according to Gupta. He points to the country’s impressive bridges and high-speed rail as examples of its forward-thinking and innovative approach to infrastructure development. The rail built all the way to Tibet, he says, is a prime example of China’s commitment to developing its infrastructure to support the needs of its citizens and its economy.

At a news conference in September 2022, Zheng Jian, the director of the Department of Infrastructure Development at the National Development and Reform Commission, echoed Gupta’s sentiments. Jian stated that China’s overall infrastructure has improved significantly in the past decade, and has been a key driver of the nation’s economic growth and social development. Jian also announced that China will continue to support the construction of major infrastructure projects, focusing on 102 key projects outlined in the 14th Five-Year Plan (2021-2025) and the five-year transportation development plan.

Gupta attributes China’s success in infrastructure development to a common purpose among its citizens and government. He says that China understood the importance of infrastructure development and made a concerted effort to bring it about. In contrast, Gupta argues that the US has fallen behind in its infrastructure development, due in part to a belief in the 1970s and 1980s that the private sector could do it all. According to Gupta, the private sector does not have the “patient capital” necessary for long-term infrastructure development, and the US has suffered as a result.

Some developing countries in East Asia, including China, have understood the value of “patient capital” in infrastructure development. According to Gupta, these countries recognized that the state needs a certain degree of autonomy from society in order to chart its own development path and achieve high-growth early in the development process. China, he says, has taken this approach to heart and has made infrastructure development a critical and fundamental aspect of its growth. The central government has played a significant role in addressing poverty and promoting growth, creating a virtuous cycle of infrastructure development and economic growth.

Gupta also highlights China’s role in re-writing the “development literature” through its concept of “social good.” He argues that China understands the value of creating high-quality public assets and that these assets help to create social cohesion and unity. He cites the example of a road in a rural area that may initially seem like a loss-making project, but in reality, creates economic growth, connectivity, and social cohesion. People come together and value these assets, protecting and growing them for the benefit of society as a whole.

In conclusion, Gupta’s comments highlight the significant role that infrastructure development can play in transforming a nation from an emerging economy to an advanced one. China’s commitment to infrastructure development has enabled it to create a virtuous cycle of growth, and it continues to re-write the blueprint for infrastructure globally. The US, on the other hand, has fallen behind due to a lack of “patient capital” and a misplaced belief in the private sector. Nevertheless, China’s success serves as a powerful example of the potential impact that infrastructure development can have on a nation’s economy and society.

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