There’s a more interesting new post over at Econlog.
Almost every week I see articles about China opening up its economy. Here’s a recent example from The Economist:
CHINA is home to 1.4bn people. The population is ageing, and thus more vulnerable to ailments. Sustained economic growth is making the country richer, and more able to afford remedies. To foreign pharmaceutical firms, this looks like a winning combination. They are less keen on protracted review times, onerous rules and the reams of paperwork required to sell drugs in China. It can take a decade after approval in America for foreign drugs to reach Chinese patients.
The Chinese authorities at last appear to have acknowledged the problem—and are administering a cure in doses that have surpassed even optimists’ expectations. A reinvigorated regulator is waving through drugs from abroad, and clamping down on unscrupulous domestic companies. The government is spending more on drugs, including foreign ones, as it expands public health care. It is letting market forces weed out frail local firms. In other words, China is becoming a more normal market. Global drugmakers are rubbing their hands. By some estimates China became the second-largest global consumer of medicines in 2017. The market is worth $122.6bn, according to IQVIA, a research firm.
And another recent example from the Financial Times:
China has been opening up its financial sector in recent months, a move that some Wall Street groups hope to benefit from. Since Beijing raised the cap on foreign ownership of securities trading and fund management companies from 49 per cent to 51 per cent in April, several big US banks have said they aim to gain majority control of their operations in China.
A few months back, CNN provided this example:
China is making good on the promise to open its huge car market to foreign automakers.
The country will remove its longstanding restriction on foreign ownership for manufacturers of electric cars, ships and aircraft this year, the government announced Tuesday.
The announcement is just a first step in what China promised will be gradual phasing out of all restrictions on foreign ownership in the automobile industry.
This has been going on for decades, and I could cite many other examples.
Another trend that has been going on for decades is media claims that China is no longer reforming its economy, and is going back to the bad old days of state control.
Which set of news stories is true?
PS. Sometimes things happen that are so weird that if they were not true you could never imagine making them up:
For decades, Taiwan and China have competed for recognition. In 1979, the United States switched its support and officially established sovereign relations with China, and many other countries followed. . . .
In recent years, China has had success in courting Taiwan’s diplomatic partners. Only 17 nations recognize Taiwan; outside the Vatican and Swaziland, they are all islands in the Pacific and the Caribbean or countries in Latin America.
American officials have expressed growing concern over the shift.
The US government, the Chinese government in Beijing, and the Chinese government in Taipei all agree that there is only “one China”, which includes the Chinese mainland and Taiwan. In 1979, the US decided that the Beijing government was the legitimate government of China. That’s still our official policy. Now several countries in Latin America are following our lead, and we are upset with them.
PPS. Tyler Cowen has an interesting Bloomberg column about 30 years of changes in Guangzhou.
PPPS. This Fu Ying essay is one of the few articles on US/China relations that I actually agree with.
PPPPS. Russ Roberts has a very interesting interview of Frank Dikötter on the Great Leap Forward. This caught my eye:
Anyway, in October 1957, to mark the 40th Anniversary of the Bolshevik Revolution, 1917, all the leaders of the socialist camp are invited to Moscow, and there Khrushchev announces that he will overtake your country, the United States, in the production of dairy products. Mao doesn’t miss a beat: he says, without even standing up, ‘If you wish to overtake the United States, we will beat England–the United Kingdom–in the production of steel within 15 years.’ That’s the start of the Great Leap Forward.
At the time, the goal seemed preposterous. China’s attempt to do this with backyard steel mills backfired, causing lots of misery. Interestingly, today China produces 100 times as much steel as the UK.