The discussion begins with preliminary remarks on the relationship between the economy and national liberation. Upon his election as General Secretary of the Communist Party of China (CPC), Xi Jinping articulated the Party's primary task: to achieve the national rejuvenation of China and contribute significantly to humanity. This statement, within China's specific context, aligns with Lenin's fundamental thesis that the patriotism of countries oppressed by imperialism is progressive, and their national liberation thus corresponds with the broader conditions of humanity. It is crucial to understand that this process is not chronological; China will not first achieve national rejuvenation and then contribute to humanity. Instead, it is through the ongoing process of China's national regeneration that it makes its contributions to humanity, a trajectory that will continue for centuries, though the precise framework of that distant future remains beyond our current comprehension.
This perspective relates to a new mood for the development of the Global South, a term I believe is highly accurate. However, this mood cannot translate into success without specific policies, organizations, and initiatives. Comprehensive development necessitates a range of policies, including economic, foreign, military, cultural, and those addressing women's issues, all of which must be meticulously developed. This conference serves as a vital part of that endeavor. Fortunately, in the economic sphere, we are arguably more advanced than in other areas, as we need not debate theory; the achievements in economic regeneration and national liberation, exemplified by China, provide a clear precedent.
Moving to other considerations, a component of this prevailing mood involves understanding China's trajectory since 1992. My visit to Russia that year was predicated on a long-held conviction that Mikhail Gorbachev's policies would lead to catastrophe. Consequently, I authored an article in Russia titled 'Why the Economic Reform Will Succeed in Russia and Fail in China,' the argument of which I considered self-evident. At that time, the prevailing sentiment in Russia, indicative of a different mood, was that this idea was foolish. Many, including some who asserted that Russia had nothing to learn from China, questioned my interest in a then-poor country, suggesting instead the study of Germany or Japan. My response was that China possessed the correct economic theory, which would inevitably lead to tremendous economic success, inviting them to revisit the discussion in a decade.
Today, such a discussion is moot. I hold a deep affection for Russia, a country that, in my view, saved the continent of Europe and perhaps the world from Nazism and fascism, a sentiment so profound that I find myself overcome with emotion when standing before the Tomb of the Unknown Soldier in Moscow, contemplating the 27 million lives lost. It is profoundly harsh that this nation is now compelled to fight for its existence, seeking national rejuvenation after the disaster of the Soviet Union's collapse and subsequent aggression. The conflict in Ukraine, as I understand it and as articulated by my interpreter, is a defensive war for Russia's self-preservation, one that will determine Europe's future. Her concise summary — 'either we are a country or we are a petrol station for the United States' — aptly captures the situation. Therefore, my assertion that Russia made an enormous mistake in 1992 by not taking charge is not born of dislike for the country. I note that President Putin, in a report around June, stated that the consensus in Russia now favors the Chinese economic development model over the Western one. I reflected then that if this position had been adopted 30 years prior, the world would be vastly different. Nevertheless, progress is being made, and we must adapt and act within our current circumstances.
Having established these points, I will now address the basis of our understanding, particularly regarding China's development. I hold immense admiration for Mao Zedong due to his monumental achievement in leading the Chinese people to national liberation and freedom from imperialism. While China did not experience an economic miracle during the Mao era — its growth was largely in line with global averages — it underwent a profound social miracle. In the 27 years of Mao Zedong's leadership, life expectancy in China increased by 31 years, equating to more than a year for every year he was in power. Beyond national considerations, such an extension of life is a testament to remarkable leadership. The economic miracle, distinct from this social transformation, commenced after 1978. While widely acknowledged, the sheer scale of this economic achievement is often not fully internalized. China's growth rate has been almost four times faster than the world's second-ranking economy. While most can identify China as the fastest-growing economy, it is noteworthy that the second fastest, since 1984, has been socialist Vietnam. This demonstrates that we need not delve into theoretical debates; the data speaks for itself.
If institutions like the International Monetary Fund (IMF) or the Organisation for Economic Co-operation and Development (OECD) were objective, they would highlight these countries as subjects for study due to their incredible success. Instead, they often advise against following their models. This is precisely why, in the economic sphere, we are more advanced in translating a prevailing mood into concrete institutions. Of course, no country can simply replicate China's model; the objective is to learn from its developmental features and adapt them. In terms of per capita Gross Domestic Product (GDP), China's growth is even more striking, exceeding four times that of any other country. In 1949, China was among the world's poorest nations, with statistics indicating only ten countries had a lower per capita GDP. Today, by World Bank classification, it is on the brink of becoming a high-income economy. The significance of this transformation lies not merely in concrete or steel production, but in the profound improvement of people's lives: increased longevity, better education, improved health, opportunities for foreign travel, and more sophisticated consumer tastes. In a single lifetime, China transitioned from being one of the world's poorest countries to approaching high-income status. Is this not the aspiration of every Global South country? Achieving such a feat would resolve numerous global problems, and it is indeed attainable.
I wish to further address the concept of the Global South, as there appears to be a common misunderstanding. While the rise of the Global South is often cited, with its share of the world's Gross Domestic Product (GDP) increasing from 32.2% to 51.6%, this aggregated view can be misleading. In reality, this growth is predominantly driven by specific regions within the Global South, primarily East Asia and, to a lesser extent, South Asia, while other parts, including Latin America — much to my regret, given my fondness for the region — have regressed. Thus, the situation is not a uniform rise across the entire Global South. This disparity is directly linked to the question of investment in the economy. The significantly higher levels of investment in East Asia and South Asia explain their growth, a pattern where Asia consistently invests more than 28% of its GDP, far surpassing any other segment of the Global South.
To technically achieve this, we must examine the trajectory of long-term development. The increase in China's investment level was not exceptionally rapid in any single year, averaging only 0.5% of Gross Domestic Product (GDP) annually over a prolonged period. However, this consistent 0.5% was sustained for 40 years, fundamentally transforming the economy's investment landscape. Let us consider other successful countries. While socialist Vietnam and socialist China are the most successful, this does not imply that other nations have achieved nothing. It is not a binary choice between adopting China's socialist model through guerrilla warfare and achieving nothing. Instead, we can observe similar patterns in other economies. Indonesia, for instance, apart from the Southeast Asian financial crisis, demonstrates a prolonged, gradual increase in the percentage of investment in GDP. India, setting aside political considerations, also exhibits sustained investment in GDP, leading to rapid growth. Bangladesh follows the exact same pattern of fast growth. This consistent trend forms what is known as the Asian development pattern.
Furthermore, a few other economies have approached this Asian development pattern, including Turkey. Despite Western assertions that Turkey is pursuing unsound economic policies, this is demonstrably false, as its developmental trajectory reveals a similar pattern. While these countries may not match China's speed, they are moving in the same direction, indicating their success. Ethiopia, prior to its political crisis and subsequent contraction, also experienced prolonged, successful development. This rapid growth in Asia is attributable to high fixed investment, not to cultural factors like Confucianism or Western mystification. China and Vietnam are indeed Confucian, but Indonesia is the world's largest Muslim country, and Bangladesh and Turkey are also Muslim. India is majority Hindu, and Ethiopia is predominantly Christian. Therefore, cultural background is irrelevant to this success.
Another crucial element of China's success is its exceptionally high level of research and development (R&D). In terms of R&D as a percentage of GDP, China has already surpassed three of the Group of Seven (G7) countries, though it still lags behind others. It is, however, rapidly catching up. Crucially, China is far ahead of any other Global South country in R&D, with Turkey, for example, investing almost twice as much as the next highest-ranking Global South nation. The development of autonomous science and technology is therefore paramount, as these processes demonstrate the possibility of national liberation in the economic sphere. Under the immense pressure of imperialism, some countries are crushed, while others succeed. The key is to maintain autonomous investment development, combined with autonomous scientific and research development within the country. This is a long-term process, as the primary challenge is not financial but human capital, requiring approximately 20 years from school entry to obtaining a PhD in engineering. There is no direct relationship between the percentage of GDP in R&D and overall GDP; rather, the crucial factor is that R&D's impact is mediated through the level of investment. In conclusion, what drives this process, which we can term national liberation in economic development, is the gradual creation of an autonomous national scientific establishment. This involves a high level of R&D, which fosters innovation. Innovation is not the product of an individual genius in a garage — that is a myth — but rather the result of systematic R&D. This innovation, however, must be translated into investment to effect real-world change; otherwise, it remains merely an idea.
Thus, the sequence and interrelation are: R&D leading to innovation, which then drives investment, ultimately fueling growth. While no country can simply copy China, these are the fundamental elements that have produced China's economic success. This outcome is perfectly predictable from an economic theory perspective, and it works. This is the message that should be conveyed to the world, rather than focusing on the latest American Nobel Prize in economics. Once one recognizes that the world's most rapidly growing economy is socialist China, and the second is socialist Vietnam, a profoundly different view of the world emerges.
(Transcribed from recording and edited.)