New Development Concepts
New Development Concepts
China’s 3rd plenum to ‘double down’ on ‘high quality development’, A Deeper Understanding of the New Development Concepts
China’s 3rd plenum to ‘double down’ on ‘high quality development’
By Josef Gregory Mahoney
Typically we would have seen a 3rd plenum, which usually focus economic policies, late last year, well ahead of the Two Sessions that comes in early spring. When it was delayed analyses ran in two directions. The first was that the leadership lacked unity or certainty over which policies it should push forward now and over the next five and ten years, particularly as the Chinese economy was still trying to consolidate a post-pandemic recovery while also encountering mounting global headwinds. The second was the opposite, that the Party was unified and already had a clear, overarching vision in place.
For example, "the new development concept," which has emphasized scientific, technological and industrial innovation since 2013, remains the cornerstone, thereby making a 3rd plenum unnecessary, and that the CPC was simply following what some have described as the New Era culture of resisting formalism.
But here we are. On the one hand, a major question that has dogged leaders is the extent to which they are ready to implement major structural reforms to the economy. In the past week or so we've heard from the premier that those aren't on the table presently. At Davos he signalled a gradualist approach where the market plays the decisive role.
On the other hand, it's clear there are a number of important reforms that are needed now. Therefore, under the rubric of "comprehensively advancing reforms," and given recent signals from the advisory body, the CPPCC, as well as key figures in economic policy-making, we might expect major new policies addressing growing needs in several different areas.
Chief among these appears to be the need for reforms to China's macro-economic governance system to better tackle problems like insufficient demand. Some have argued this might require lowering interest rates and taking on more government debt, while also discouraging local government from competing too much with the private sector for profits. Also there have been some calls for allowing migrants to settle permanently in cities to stabilize local demand while also improving social justice.
We should anticipate significant reforms in many sectors. For example, there's growing pressure to improve the national health insurance system, including stabilizing required contributions, which have surged in some locations in recent years, and improving coverage and benefits for the elderly. Because the national system actually pools contributions at establishes benefits at the prefecture level, some argue that it's more accurate to say China several hundred separate systems. To some extent this is unavoidable given the wide disparity in development levels and costs, but it's also the case the system is ripe for reform.
Finally, we can expect China to double down on "high quality development" related to tech and innovation given increasing pressures from US-led tech-decoupling.
Read more here.
NB: Josef Gregory Mahoney is the Professor of Politics and International Relations and Director of the International Graduate Program in Politics, East China Normal University 华东师范大学
A Deeper Understanding of the New Development Concepts
A Deeper Understanding of the New Development Concepts*
Excepts from speech by Xi Jinping January 18, 2016
On the philosophy of innovative, coordinated, green, open, and inclusive development, I have talked much at the Fifth Plenary Session of the 18th CPC Central Committee in 2015 and on other occasions. Today, I will not try to elaborate on it from the practical perspective of our work, but proceed from history and reality, and offer some suggestions on how to tackle major issues.
Firstly, we should implement the strategy of innovation-driven development.
We should put innovation first because it is the primary driving force for development. The force of innovation determines the speed, effectiveness, and sustainability of development. In the case of such a large economy as China, without continued development impetus we will find it difficult to realize sound and sustained economic growth; we will struggle to double the 2010 GDP and per capita income for both urban and rural residents by 2020. Of course, coordinated, green, open, and inclusive development helps to strengthen the impetus of development, yet the core is innovation. Innovation is the key to driving overall social and economic development.
The need to pursue innovative development is a conclusion drawn from the world's development process in modern times and from China's practice in reform and opening up since 1978. Pursuing innovative development is fundamental to our strategy in adapting to the changing environment of development, enhancing the impetus of development, seizing the initiative in development, and leading the new normal.
Reviewing the world's development process in modern times, we can see that a country's or a nation's capacity for innovation influences its future and can even be the determining factor.
In the 16th century, human society entered an unprecedented period of active innovation. Achievements in scientific innovation over the past five centuries have exceeded the sum total of several previous millennia. Especially since the 18th century, the world has witnessed several major scientific revolutions, such as the birth of modern physics, steam engines and machinery, electricity, transportation, the theory of relativity and quantum theory, and the development of electronic and information technology. Each and every scientific and industrial revolution has profoundly changed the outlook and pattern of world development. Some countries have seized the available opportunities, so they achieved rapid social and economic development, and increased their economic, scientific and military strength. Some have emerged as world powers. The first Industrial Revolution, which originated in the UK in the 18th century, made the country the world leader. The US took the opportunity of the second Industrial Revolution in the mid-19th century and surpassed the UK, becoming the No. 1 world power. Since the second Industrial Revolution, the US has maintained global hegemony because it has always been the leader and the largest beneficiary of scientific and industrial progress.
China has the motivation and the skills required for successful innovation. China's development and the historical achievements I have mentioned previously can be attributed to its scientific inventions and innovation. Ancient China's achievements in astronomy, calendar, mathematics, agriculture, medicine, and geography were remarkable. These inventions were closely related to economic activity, providing forceful support to the development of agriculture and the craft industries. The British philosopher Francis Bacon once said that printing, gunpowder, and the magnet had changed the whole face and state of things throughout the world, and that no empire, no sect, no star seemed to have exerted greater power and influence in human affairs than these mechanical discoveries.
Records show that China has 173 items among the world's most important 300 inventions and discoveries made before the 16th century, far surpassing Europe in the same historical period. China led the world for a long time, and China's culture and thought, social system, economic progress, science, and technology motivated and led its neighboring countries and regions. Since the advent of modern times China has lagged behind, mainly because we missed the great development opportunities brought by the scientific and industrial revolutions of the 18th and 19th centuries.
Nowadays, social and economic development throughout the world relies more on theoretical, institutional, scientific, and cultural innovation, while new competitive edges are to be gained through the capacity for innovation. Those countries which advance in innovation will seize the initiative in leading global development. A new round of scientific and industrial revolution is on the way, whose main characteristics are as follows: Major revolutionary technologies are emerging; the transformation of scientific achievements is accelerating; the form of industrial organization and industrial chains is more monopolistic. Major world powers have adopted new strategies to promote innovation, increased investment in innovation, and made greater efforts to contend for strategic resources in innovation such as talent, intellectual property and standards.
Despite being the world's second largest, China's economy is obese and weak. Inadequate capacity for innovation is its Achilles' heel. Innovation-driven growth has become the pressing demand for China's development. Therefore, I stress repeatedly that innovation is development; innovation is the future.
Through years of efforts, China's overall scientific capacity has improved, transforming from quantitative increase to qualitative improvement. It has now reached advanced international level in some major areas. Nevertheless, China's key technologies remain restrained by other countries; China's scientific reserve is far from adequate to create new industries and lead future global development; China's industries remain at the middle and low end of global value chains; and China lags far behind developed countries in high technologies for military and security use. Therefore, we must seek development based on innovation, foster new development impetus through innovation, and promote leading edge development that gives greater incentives to first innovators.
Innovation is a complicated and systematic social program covering all social and economic areas. In pursuing innovative development we should adopt a holistic view, while at the same time attending to key issues and propelling overall development through innovative breakthroughs in major areas and at key points. We should make plans ahead of time, focusing on core economic competitiveness, pressure points in social development, and major challenges to national security. We should improve basic research and research on key general-purpose technologies which have a bearing on overall development. We need to improve our capacity for independent innovation, and make major breakthroughs in scientific innovation, striving to push our scientific capacity to a higher level, in an attempt to catch up with and eventually surpass the advanced countries. Driven by major scientific innovation, we should accelerate the application of innovative technology in industry, and build a new industrial system. In this way we can ensure that we possess technologies that other countries have, that we possess technologies that are stronger than those of other countries, and that our technologies are more advanced than those of other countries, so as to enhance our overall economic quality and international competitiveness. We should further scientific institutional reform, and promote talent development systems and policy innovation, with an emphasis on cultivating highly educated, professionally competent, cutting-edge, and urgently needed personnel. We should open our arms wider to innovative talent from overseas, and bring together the world's best minds to contribute to our nation's development.
Secondly, we should enhance overall and coordinated development.
"Everything has its counterpart."1 According to materialistic dialectics, things are universally related; they interact with and constrain each other, and so do their composing elements; the world is an interrelated whole and also an interactive system. Applying materialistic dialectics, we should grasp the inherent relationship between objective things to understand and handle problems. Authors of Marxist classics value materialistic dialectics, and are skilled in applying them to understand and explore the theory of movement of opposites in the development of human society. For example, Karl Marx proposed that social reproduction falls into two categories – means of production and means of subsistence, and they must maintain a certain ratio to realize social reproduction.
While leading the people to build socialism, the CPC has formed many ideas and strategies concerning coordinated development. As early as 1949, when the PRC was founded, Mao Zedong put forward the holistic approach and the working method of "playing the piano". He said, "In playing the piano all ten fingers are in motion; it won't do to move some fingers only and not others. But if all ten fingers press down at once, there is no melody. To produce good music, the ten fingers should move rhythmically and in coordination. A Party committee should keep a firm grasp on its central task and at the same time, around the central task, it should unfold the work in other fields. At present, we have to take care of many fields; we must look after the work in all the areas, armed units and departments, and not give all our attention to a few problems, to the exclusion of others. Wherever there is a problem, we must put our finger on it, and this is a method we must master."2 "On the Ten Major Relationships" is a typical example of Mao Zedong's application of the idea that the world is an interrelated whole to expounding the law of building socialism. In "On the Correct Handling of Contradictions Among the People", he further raised the principle of "overall consideration and proper arrangement".
After China adopted reform and opening-up policy in 1978, Deng Xiaoping analyzed the existing situation and the problems we faced, saying, "Since our modernization program covers many fields, it calls for an overall balance and we cannot stress one to the neglect of the others."3 In various stages of reform and opening up, Deng Xiaoping set forth the principle of grasping two links at the same time. Jiang Zemin proposed to handle 12 major relationships4 that affect overall development in advancing socialist modernization. Hu Jintao put forward comprehensive, balanced, and sustainable development. The Party put forward at its 18th CPC National Congress the Five-point Strategy of promoting economic, political, cultural, social, and ecological progress in building Chinese socialism. Later we put forward the Four-pronged Strategy – to complete a moderately prosperous society in all respects, to further reform, to advance the rule of law, and to strengthen Party discipline. These policies all manifest a deeper understanding of coordinated development, and have proved the significance of materialistic dialectics in resolving China's development issues.
Presently, coordinated development has acquired new features. Coordinated development is the means and the objective of development, the standard and measurement for evaluating development. In the development of all things, we should address both major and minor problems, both major and minor aspects of a problem; at the same time, we should focus on major problems and major aspects of a problem. Coordinated development is the unity of the above two theories. A country, a region, or an industry has both strengths and constraints at any given development stage. Accordingly, we should make a targeted effort to resolve tough problems and improve weak points, and at the same time, consolidate and foster our existing strengths. By taking the two measures that complement each other we can achieve high-level development. Coordinated development is the unity of balanced development and imbalanced development. The process from balance to imbalance and then to rebalance is the basic law of development. Balance is relative while imbalance is absolute. Emphasizing coordinated development is not pursuing equalitarianism, but giving more importance to equal opportunities and balanced resource allocation. Coordinated development is the unity of weakness and potential in development. China is in a stage of transition from a middle-income country to a high-income country. According to international experience, this is a stage of concentrated conflicts of interest, in which imbalanced development and various weaknesses are inevitable. To pursue coordinated development, we should identify and improve our weaknesses, so as to tap development potential and sustain growth momentum.
In order to secure overall national development during the 13th Five-year Plan period (2016-2020), pursuing coordinated development is the key. We should learn to use the method of dialectics, be good at "playing the piano", and properly handle the relationships between the part and the whole, between the present and the future, between major and minor issues. We should weigh our strengths and weaknesses, draw on strengths and avoid weaknesses, and make strategic choices in the best of our interests. Proceeding from the prominent problems in our imbalanced, uncoordinated, and unsustainable development, we need to promote coordinated development between regions, between urban and rural areas, and between material and cultural progress, and promote integrated development of economic growth and national defense. This is the key feature of coordinated development affirmed at the Fifth Plenary Session of the 18th CPC Central Committee.
We should develop regional comparative edges, and improve the distribution of productive forces. We should make special efforts to implement three strategies – the Belt and Road Initiative, the Coordinated Development of Beijing, Tianjin and Hebei, and the Yangtze River Economic Belt. We should support accelerated development in old revolutionary bases, areas with concentrations of ethnic minorities, border areas, and poor areas. We should build a multi-centered, IT-supported, and open regional development framework which connects the eastern, central, and western regions and runs through the southern and northern regions, so as to narrow regional development gaps. We should continue to ensure that industry helps agriculture and that cities support the countryside; we should implement the policy of giving more, taking less, and loosening control to increase rural incomes; we should balance public resource allocation in urban and rural areas; we should build new forms of relationship between industry and agriculture and between urban and rural areas in which industry promotes agriculture, urban areas support rural development, industry and agriculture reinforce each other, and urban development and rural development are integrated, so as to continue to narrow the gap between urban and rural development. We must adhere to the goal of advancing socialist culture, using core socialist values to forge consensus and gather strength, using outstanding cultural products to inspire people and boost morale, and using the best of traditional Chinese culture to nourish morality, thereby raising cultural progress to a higher level. We must ensure both economic development and the development of defense capabilities; we should further the integration of military and civilian development and achieve a cost-effective civil-military integration that covers all elements and all fields; we should ensure that strengthening national defense and the armed forces is consistent with completing the First Centenary Goal, and ensure the coordinated, balanced, and inclusive development of the two processes.
Thirdly, we should promote the harmonious coexistence of humanity and nature.
The purpose of green development, fundamentally speaking, is to serve this end. Human development activities must respect, accommodate, and protect nature; otherwise nature will retaliate against us. This is a law no one can deny.
Frederick Engels argued in Dialectics of Nature: The people who, in Mesopotamia, Greece, Asia Minor and elsewhere, destroyed the forests to obtain cultivable land, never dreamed that by removing along with the forests the collecting centers and reservoirs of moisture they were laying the basis for the present forlorn state of those countries. When the Italians of the Alps used up the pine forests on the southern slopes, so carefully cherished on the northern slopes, they had no inkling that by doing so they were cutting at the roots of the dairy industry in their region; they had still less inkling that they were thereby depriving their mountain springs of water for the greater part of the year, and making it possible for them to pour still more furious torrents on the plains during the rainy seasons.
In the 20th century, the eight social pollution nuisances that occurred in Western countries greatly affected the eco-environment and public life. Of these, the Los Angeles photochemical smog in the 1940s caused nearly 1,000 deaths, and 75 percent of local citizens suffered from pinkeye disease. The Great London Smog of 1952 in the UK caused about 4,000 deaths in only a few days during its first outbreak in December, and then nearly 8,000 deaths from respiratory diseases in the following two months; later, the city was stricken by 12 severe smog attacks in 1956, 1957 and 1962. The Minamata disease of 1956 in Japan was caused by methylmercury-containing sewage discharge into Minamata Bay. After eating polluted fish and shellfish, local people suffered from severe mercury poisoning, the number of victims being about 1,000 and the number of people at risk reaching 20,000. American writer Rachel Carson gave a detailed account of the situation in her book Silent Spring.
According to historical records, China's Loess Plateau, Weihe River drainage, and Taihang Mountains – now sparse in vegetation – were once covered by dense forests and crisscrossed by clear streams, arable farmland and natural pastures; however, deforestation for agriculture severely damaged the local eco-environment. The expansion of the Taklamakan Desert buried the once-prosperous ancient Silk Road. The expansion of the Hexi Corridor Desert destroyed the ancient city of Dunhuang. The Khorchin and Mu Us sandy lands and the Ulan Buh Desert encroached on the beautiful and fertile Mongolian Steppe. The ancient city of Loulan declined as the Peacock River changed its course as a result of reclaiming wasteland for farming and irrigation. The plains in the north of Hebei once abounded with lush woods and meadows, but the land reclamation policy during the Tongzhi years (1862-1874) of the Qing Dynasty reduced the 500-kilometer stretch of pinewoods to barren mountains. We must take warning from these cases.
In treating nature, Frederick Engels pointed out: "Let us not, however, flatter ourselves over much on account of our human victories over nature. For each such victory nature takes its revenge on us. Each victory, it is true, in the first place brings about the results we expected, but in the second and third places it has quite different, unforeseen effects which only too often cancel the first."5 Humanity was born in nature, lives in coexistence with nature, and will finally incur harm by damaging nature. Only by respecting the law of nature can we avoid setbacks in developing and utilizing nature. We must bear this principle in mind and put it into practice.
Since reform and opening-up policy was adopted in 1978, China's economic development has made historic progress. This is what we are proud of and also what has won the admiration of other countries. Nevertheless, we must be aware that ecological problems have become our obvious weaknesses and a pressing public concern. For example, frequent incidences of environmental pollution have endangered lives and caused widespread distress. We must make every effort to change this situation.
Our predecessors understood the significance of the eco-environment. The Analects of Confucius6 says, "The master fished with a line but not with a net; when fowling he did not aim at a roosting bird." Xun Zi argued, "If it is the season when the grasses and trees are in the splendor of their flowering and sprouting new leaves, axes, and halberds are not permitted in the mountain forest so as not to end their lives prematurely or to interrupt their maturation. If it is the season when the giant sea turtles, water lizards, fish, freshwater turtles, loach, and eels are depositing their eggs, nets and poisons are not permitted in the marshes so as not to prematurely end their lives or to interrupt their maturation."7 Lü's Spring and Autumn Annals8 also states "If you drain off the water to catch fish, how can you miss them? But there will be no fish in the river at all the next year. If you set swamps on fire to catch animals, how can you miss them? But there will be no animals at all the next year." These ideas – taking from nature at the proper time and to the proper extent – have a great and genuine significance.
Eco-environment has no substitutes. We are not aware of this when we exploit it, yet it is irretrievable once lost. As I previously mentioned, environment is livelihood, green mountains are beauty, blue sky is happiness, and clear water is wealth. Protecting the environment equates to protecting productive forces; improving the environment equates to developing productive forces. In protecting the environment, we must develop a broad, long-term and holistic perspective. We shall not try to save a little only to lose a lot; we shall not attend to one thing and lose sight of another; we shall not eat our corn in the cob; we shall not be eager for quick success and instant benefit. We should adhere to the fundamental state policy of conserving resources and protecting the environment. We should protect the eco-environment like our own eyes, and treat the eco-environment as our own lives. We should develop a green mode of development and a green way of life, as a support to increasing individual and national prosperity and creating a beautiful environment. Lately, at the symposium on the development of the Yangtze River Economic Belt held at Chongqing, I emphasized that we must prioritize the eco-environment and pursue green development, treat the restoration of the Yangtze River eco-environment as an overwhelmingly important task, and step up our efforts for large-scale eco-protection instead of eco-exploitation.
Officials at all levels must enhance their faith in eco-protection and discard development patterns and methods that damage or even destroy the environment. They must not pursue short-term growth at the cost of the eco-environment. We should be firm in promoting green development and the appreciation of natural capital, so that a sound eco-environment helps improve the people's quality of life and presents a positive image of the country. We should ensure the people breathe fresh air, drink clear water, eat safe food, and enjoy a livable environment. We should ensure the people receive the real environmental benefits from economic development, living with a blue sky, green mountains, clear waters, and a better environment than ever before, and step into a new era of eco-progress.
Fourthly, we should establish a new system of opening up.
China's development achievements over the past 30 years derive from opening up. The prosperity of a country and the rejuvenation of a nation mostly rely on following the trend of the times and propelling historical progress.
Economic globalization is the trend we have to recognize in planning our development. The concept of "economic globalization" became popular after the Cold War ended, but it is not a new phenomenon. As early as the 19th century, Karl Marx and Frederick Engels elaborated theories on world trade, world markets, and world history in The German Ideology, Manifesto of the Communist Party, Economic Manuscript of 1857-1858, Capital and other works. They pointed out in the Manifesto of the Communist Party: "The bourgeois has through its exploration of the world market given a cosmopolitan character to production and consumption in every country."9 Marx and Engels' perception and arguments revealed the nature, logic, and process of economic globalization, laying a theoretical foundation for us to understand the concept today.
Economic globalization underwent three general stages. First, colonial expansion and the formation of the world market. Western countries, through plunder, occupation by force, and colonial expansion, had largely completed the carve-up of the world before the outbreak of World War I, bringing all regions and nations into a single capitalist world system. Second, two parallel world markets. After World War II, a number of socialist countries emerged, and colonial and semi-colonial countries declared their independence, which divided the world into two camps and formed two parallel markets in the international economy. Third, economic globalization. As the Cold War ended in 1991, opposition between the two camps and the two parallel world markets disappeared; interdependence between countries increased; and economic globalization quickened its pace.
Accordingly, China's relationship with the world also underwent three stages. First, from national seclusion to semi-colonialism and semi-feudalism. Before the Opium War, China was isolated from the world market and global industrialization. After that, during the wars against Western aggression, China suffered repeated defeats and fell to the status of a poor and weak country.
Second, sole alliance with the Soviet Union and national semi-seclusion, and then complete seclusion. After the founding of the PRC in 1949, China explored the path of building socialism in sole alliance with the Soviet Union and in semi-seclusion from the rest of the world, and almost completely separated itself from the international community during the Cultural Revolution.
Third, multidimensional opening up. Since reform and opening up in 1978, China has taken advantage of economic globalization and steadily opened ever-wider to the outside world, marking a historic change.
Practice has proved that to develop and grow stronger, we must comply with the trend of economic globalization, adhere to opening up, and make full use of advanced scientific achievements and management experience. During the early period of reform and opening up, when we lacked strength and experience, many people doubted whether we could benefit from reform and opening up without becoming corroded and being swallowed up by the dominant Western countries. In those years, we came under heavy pressure in pushing the negotiations on China's accession to the General Agreement on Tariffs and Trade and the World Trade Organization. Looking back today, we chose the correct direction of development by opening up the country and going global.
Twenty or even 15 years ago, the major propellants of economic globalization were the US and other Western countries. Today, China is considered the biggest driver of global trade liberalization and facilitation, resisting various forms of Western protectionism. This proves that as long as we consciously support the trend of global development, we can grow stronger and lead world development.
In promoting open development, the domestic and international situations we face now are quite different from the past. On the whole, we have more favorable factors; we also face significant risks and challenges that are by no means negligible. This can be seen from four perspectives.
First, power structures among various countries are changing positively in an unprecedented way. The rise of emerging market economies and developing countries is changing the global political and economic landscapes. There is an irresistible trend towards world polarization and democracy in international relations. The West-dominated global governance system is finally showing signs of change, but the competition to gain dominance in global governance and the formulation of international rules is fierce. Since Western developed countries retain advantages in economy, science and technology, politics, and military affairs, there is a long way to go to build a fairer and more equitable international political and economic order.
Second, the world economy is gradually emerging from the shadow of the global financial crisis. Western countries are maintaining the momentum of economic recovery through reindustrialization. The structure of the international industrial division of labor has changed, but protectionism remains severe worldwide. The formulation of international economic and trade rules tends to be politicized and fragmented. Emerging market economies and developing economies are still sluggish, and the global economy has not yet found new engines for full recovery.
Third, China's share of the world economy and global governance has increased rapidly. China is now the world's second largest economy, its largest exporter, its second largest importer, its second largest source of foreign direct investment, its largest holder of foreign exchange reserves, and its largest market for tourism. China has become a major factor in changing the world political and economic landscapes. Nevertheless, it remains the case that China's economy is big but not strong, and our per capita income and living standards are not in the same league as those of Western countries. We need to work harder to turn our economic strength into international institutional authority.
Fourth, China's opening up has reached a better balance between bringing in and going global. The opening-up pattern has changed from mainly bringing in to both bringing in and going global on a large scale, but the corresponding law, consultancy, finance, personnel, risk management, and safety controls cannot meet the practical needs, while our mechanisms remain weak in supporting high-level opening up and large-scale going global.
This means that the overall environment for open development is more favorable than ever before, but the conflicts, risks, and contests we are facing are also unprecedented, setting delicate traps for any potential negligence. On the subject of the next steps in open development, the Fifth Plenary Session of the 18th CPC Central Committee made pertinent provisions, and I also set out some requirements in the speech at the second full assembly. I hope we continue to explore and practice, enhance our conscientiousness and capabilities to address the overall situation both domestically and internationally, and improve the effectiveness and level of opening up.
Fifthly, we should practice the people-centered philosophy of development.
This was initiated at the Fifth Plenary Session of the 18th CPC Central Committee. It displays the CPC's fundamental purpose of serving the people wholeheartedly, and the materialistic historical view that the people are the primary force for propelling development.
As mentioned in ancient Chinese classics, "There are some fixed principles in governing a state, among which benefiting the people should be the root."10 The people-centered development philosophy is not an abstract, abstruse concept. We will not restrict ourselves to lip service or idle reflection, but put it into practice in all areas of social and economic development. We should maintain the people's principal position in the country, and fulfill the people's expectations for a better life. We should continue to realize, safeguard, and develop the fundamental interests of the overwhelming majority of the people. We should ensure that development is for the people, that it is reliant on the people, and that its fruits are shared by the people. We should, through furthering reform and innovation-driven development, enhance the quality and increase the benefits of development. We should produce more and better material and cultural products to meet the ever-growing material and cultural needs of the people. We should fully stimulate the people's initiative, enthusiasm, and creativity, and provide the platform and environment for all workers, entrepreneurs, idea generators, and officials at all levels to play their innovative role. We should adhere to the basic socialist economic system and the socialist income distribution system. We should adjust the pattern of national income distribution. We should improve the mechanism of secondary distribution regulating income distribution mainly through taxation, social security, and transfer payments. We must safeguard social fairness and justice, and narrow income gaps, so that all the people can have a greater share of the fruits of development in a fair way.
In nature, the philosophy of shared development represents the idea of people-centered development. It reflects the demand of achieving shared prosperity in stages. Shared prosperity is a primary goal of Marxism; it has also been a basic ideal of the Chinese people since ancient times. Confucius11 said, "He is not concerned lest his people should be poor, but only lest what they have should be ill-apportioned. He is not concerned lest they should be few, but only lest they should be divided against one another."12 Mencius13 said, "Do reverence to the elders in your own family and extend it to those in other families; show loving care to the young in your own family and extend it to those in other families."14 The Book of Rites15 gives a detailed and lively description of "moderate prosperity" and "great harmony".
According to Karl Marx and Frederick Engels, communism will eradicate the opposition and differentiation between classes, between urban and rural areas, between mental labor and physical labor; it will adopt the principle of distribution from each according to his ability and to each according to his needs, so as to achieve shared development of society and the free and well-rounded development of individuals in the real sense.
Of course, there will be a long trek through history to reach this goal. China is still in the primary stage of socialism and will long remain so. Therefore, we cannot do what is premature, but this does not mean we should do nothing in realizing shared prosperity step by step. Instead, we should start to do what is appropriate to the current conditions, accumulating small successes and moving towards prosperity for all.
In the early years after the founding of the PRC, Mao Zedong pointed out: "Since we are implementing such a system, such a plan, the country can grow more prosperous and powerful year by year, and we will see that happen. The prosperity is shared prosperity and the power is also shared by all the people."16 During the reform and opening-up period, Deng Xiaoping emphasized shared prosperity repeatedly. As he said to several colleagues from the CPC Central Committee in December 1990: "Since the very beginning of the reform we have been emphasizing the need to seek common prosperity; that will surely be the central issue some day. Socialism does not mean allowing a few people to grow rich while the overwhelming majority live in poverty. No, that is not socialism. The greatest superiority of socialism is that it enables all the people to prosper, and common prosperity is the essence of socialism."17 Jiang Zemin also emphasized, "Achieving common prosperity is a fundamental principle and essential characteristic of socialism, and we absolutely cannot vacillate on this issue."18 Hu Jintao also required, "We should ensure all our people share the fruits of development and move steadily towards shared prosperity."19 After years of hard work, quality of life has improved significantly and people have a fairer share of the benefits of social development; this is a remarkable achievement.
The philosophy of shared development, put forward at the Fifth Plenary Session of the 18th CPC Central Committee, emphasizes four points.
First, the beneficiaries are all the people. This is about the coverage of shared development. Shared development means development fruits are shared by all the people, each enjoying his or her share. They are not to be shared by the few or by a special group.
Second, the development benefits to be shared cover all fields. This is about the content of shared development, including economic, political, cultural, social and ecological achievements. We should safeguard the people's rights and interests in all these respects.
Third, development achievements are shared through making concerted efforts for development. This is about the means of realizing shared development. It is through jointly contributing to development that people enjoy the benefits of inclusive development. The process of contributing together is also the process of sharing benefits. We should practice democracy, widely gather the wisdom of the people, and encourage their efforts, so that all the people participate in and dedicate themselves to shared development, and share a sense of accomplishment.
Fourth, shared development is realized step by step. This is about the process of achieving shared development. As a Chinese proverb goes, you will not make a strong man out of one meal. Shared development must extend from lower to higher levels and move from imbalance to balance. It must be differentiated even at an advanced level. Our policy design should be based on the national conditions and the future socio-economic development level. We should neither hesitate to move forward, nor be niggardly with necessary investments, nor aim too high, nor spend on deficit, nor issue empty promises without providing real gain.
These four points are interconnected, so we must understand and tackle them as a whole.
In terms of implementing the philosophy of shared development, the 13th Five-year Plan proposed many tasks and measures which can be distilled down to two points. First, we should give full rein to the people's enthusiasm, initiative, and creativity, gather their strength to advance Chinese socialism, and "make the cake bigger". Second, once the cake has indeed become bigger, we must cut it fairly, so as to demonstrate the full strength of socialism and make the people feel a greater sense of gain. We should expand the middle-income class, and gradually form an olive-shaped income distribution structure. In particular, we should make greater efforts to help people in difficulties and win the campaign against rural poverty. Implementing shared development is a big issue. From the top-level design to the "last kilometer" of policy implementation, we should make continuous efforts to mark new milestones in our progress.
* Part of the speech at a study session on implementing the decisions of the Fifth Plenary Session of the 18th CPC Central Committee, attended by officials at the provincial/ministerial level.
Notes
1 Cheng Yi: The Book of Changes Annotated by Cheng Yi (Zhou Yi Cheng Shi Zhuan). Cheng Yi (1033-1107) was a neo-Confucian philosopher and educator of the Northern Song Dynasty.
2 Mao Zedong: "Methods of Work of Party Committees", Selected Works of Mao Zedong, Vol. IV, Eng. ed., Foreign Languages Press, Beijing, 1961, p. 379.
3 Deng Xiaoping: "The Present Situation and the Tasks Before Us", Selected Works of Deng Xiaoping, Vol. II, Eng. ed., Foreign Languages Press, Beijing, 1995, p. 251.
4 This refers to the relationship between reform, development, and stability; the relationship between speed and results; the relationship of economic development to the population, resources, and the environment; the relationship between primary, secondary, and tertiary industries; the relationship between the eastern region and the central and western regions; the relationship between market mechanisms and macro-control; the relationship between the public sector and other sectors of the economy; the relationship of income distribution between the state, enterprises, and individuals; the relationship between opening wider to the outside world and maintaining our self-reliance; the relationship between central and local authorities; the relationship between national defense development and economic development; the relationship between material progress and cultural and ethical progress.
See "Correctly Handle Certain Major Relationships in the Socialist Modernization Drive", Selected Works of Jiang Zemin, Vol. I, Eng. ed., Foreign Languages Press, Beijing, 2010, pp. 449-464.
5 Frederick Engels: Dialectics of Nature, Eng. ed., Progress Publishers, Moscow, 1986, p. 180.
6 The Analects of Confucius (Lun Yu) is one of the Confucian classics. Written by the disciples of Confucius, it records the words and deeds of Confucius, and also comprises dialogues between Confucius and his disciples.
7 Xun Zi. Xun Zi (c. 325-238 BC) was a philosopher, thinker and educator of the Warring States Period.
8 Lü's Spring and Autumn Annals (Lü Shi Chun Qiu) was compiled by the followers of Lü Buwei (c. 292-235 BC), chief minister of the State of Qin during the Warring States Period.
9 Karl Marx and Frederick Engels: Manifesto of the Communist Party, Eng. ed., Foreign Languages Press, Beijing, 1965, p. 37.
10 Huai Nan Zi.
11 Confucius (551-479 BC), also known as Kong Qiu or Zhongni, was a philosopher, educator and statesman in the Spring and Autumn Period. He was the founder of Confucianism.
12 The Analects of Confucius (Lun Yu).
13 Mencius (c. 372-289 BC), also known as Meng Ke or Ziyu, was a philosopher and educator in the Warring States Period.
14 The Mencius (Meng Zi).
15 Book of Rites (Li Ji), one of the Confucian classics, is an important work for the study of ancient China's social forms, laws, and regulations, and traditional Confucian canon.
16 Mao Zedong: "Speech at the Seminar on the Socialist Transformation of Capitalist Industry and Commerce", Collected Works of Mao Zedong, Vol. VI, Chin. ed., People's Publishing House, Beijing, 1999, p. 495.
17 Deng Xiaoping: "Seize the Opportunity to Develop the Economy", Selected Works of Deng Xiaoping, Vol. III, Eng. ed., Foreign Languages Press, Beijing, 1994, p. 351.
18 Jiang Zemin: "Correctly Handle Certain Major Relationships in the Socialist Modernization Drive", Selected Works of Jiang Zemin, Vol. I, Eng. ed., Foreign Languages Press, Beijing, 2010, p. 455.
19 Hu Jintao: "Build a Harmonious Socialist Society", Selected Works of Hu Jintao, Vol. II, Chin. ed., People's Publishing House, Beijing, 2016, p. 291.
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