CPC centenary goals vital for world too

In his July 1 landmark speech to mark the 100th anniversary of the founding of the Communist Party of China, President Xi Jinping, also general secretary of the CPC Central Committee, said: "We have overcome a long list of major risks and challenges, fulfilled the first centenary goal, and set out strategic steps for achieving the second centenary goal."

The CPC is committed to building China into a great, modern, socialist country by 2050, while 2049 will mark the 100th year of the founding of the People's Republic, and its progress toward this goal will have a major impact on the economic prospects of the rest of the world.

During the 100 years of its existence, the CPC's overall emphasis has been on rebuilding and transforming China. The second half of the last hundred years bore the final fruits of the efforts taken in the previous decades. After the launch of reform and opening-up in the late 1970s, the Chinese economy began growing by leaps and bounds, which enabled the country to eventually eradicate extreme poverty by the end of last year and greatly raise the incomes of its people.

External integration played an extremely important role in China's economic transformation, as the country's ability to efficiently manufacture a wide range of export products helped it to capture large shares of major global markets. In the process, China became the largest industrial economy in the world. Over the years, China has also become a significant part of major global supply chains. And its share in the world economy, which was nominal at the end of World War II, has rebounded－to 18 percent.

China achieved economic success at a time when the global political and economic order was undergoing significant changes. The geopolitical divide during the Cold War gave way to a more unipolar world order, and led to the growth of global economic institutions such as the World Trade Organization that helped China and other developing economies play bigger roles in global trade.

Now, as it crosses a hundred years, the CPC faces a new reshaping of the world order. The current world order is giving way to a more multipolar configuration. And China, a rapidly rising power, will need to work within the space of the evolving world order to shape its goals and ambitions.

Yet the COVID-19 pandemic has had a huge impact on the context of the new world. In particular, the pandemic has significantly altered national and business perspectives toward the global economy and its future orientation, hastened the adoption of digital practices, and made public health management and sustainable trade and living practices imperative. So countries, particularly large and populous ones such as China have to be at the forefront of implementing these practices.

The pandemic has had an impact on other fields too. For example, it has neutralized a large percentage of the economic prosperity that the globalized world had achieved over the past few decades, which is most visible in developing Asia. The region has suffered its first economic recession in nearly six decades, with many people, engaged in various industries and services becoming jobless and, worse, many of them slipping back into poverty.

China is also changing in response to the pandemic, which is evident in the articulation of strategies such as the "dual circulation" development paradigm. Unlike in the past, the Chinese economy might, in the foreseeable future, see more parts of its supply chains getting relocated within the country. It is also likely that the institutionalizing of the principle of production in China will be oriented more toward domestic consumption.

The challenge for China will clearly be to stick to the greater social and economic objectives of its overall vision within a changing economic policy space. Over the past four-odd decades, China has showed remarkable policy agility in making socialism adaptable. It has been able to blend socialist ideas with market-oriented mechanisms in a unique pattern leading to the creation of the socialist market economy.

As the CPC pushes toward the goal of building a great modern, socialist economy, the rest of the world will be waiting to see what it means for China's overall economic policy trajectory.

Will the new initiatives being taken by China－such as the introduction of the digital renminbi－develop with a less inclusive focus on the rest of the world? It is well established that the Chinese economy is so important for the world that effective decoupling of other major economies from China is extremely difficult. In that case, does China's greater emphasis on "internal circulation", that is, the domestic market, mean the creation of different standards that the world will need to adjust to? And how difficult will such an adjustment be?

The CPC's focus will undoubtedly be on the Chinese people and their economic and social welfare. During the last wave of globalization, China combined the objective of raising the living standards of the Chinese people with those of people in other parts of the world.

Such expectations from China continue to remain significant. Hopefully, the CPC's second centenary goal will conform to these expectations.

The author is a senior research fellow and research lead (trade and economics) at the Institute of South Asian Studies, National University of Singapore.