Experts glean lessons from China
Updated: 2011-06-21 10:45
By Chen Weihua (China Daily)
(From left) Joseph Kahn, deputy foreign editor of The New York Times; Feng Lun, chairman of Vantone Group; Klaus Kleinfeld, CEO of Alcoa Inc; Liang Xinjun, vice-chairman and CEO of Fosun International; and Wang Shi, chairman of Shenzhen-based Vanke Group, at the New York Forum. Zhang Yuwei / China Daily
NEW YORK - CEOs, financiers and government officials at the New York Forum were looking for ways to fix the United States economy, from job creation to deficit reduction, but they were divided on how much the US should and can learn from China.
The confidence in China among the audience in the Grand Hyatt New York was high. More than half of them raised their hands when moderator Maria Bartiromo, an anchor for CNBC, asked how many believe that the Chinese economy is going to be the world's largest in 20 years.
Glenn Hubbard, dean of Columbia Business School, said China offers very important lessons for the US.
"The Chinese stimulus package after the crisis was far more effective than that of the United States. China is doing a very good job as a growth machine," he told China Daily after a panel discussion.
"Not only is there much the US can learn from China, China is a real opportunity for US business people, much more than it is a threat," Hubbard said. "My worry about China is that it has a lot of weaknesses in its domestic financial system."
Hubbard believes the US should focus more on industrial and innovation policies and increase its investments in basic research and training, such as in community colleges.
But Mark Zandi, chief economist at Moody's Analytics, does not believe that this industrial policy will work in the US.
"It's important that we take the right lessons from the Chinese experience. One of the lessons I keep hearing from the business community is that we need an industrial policy target certain industries for development and growth. You can do that in very simple economies," he said. "We have to be very careful looking at the Chinese and say that we are just going to do the same thing. Those working there may not work in complex economies."
Edmund Phelps, Nobel Prize Laureate in Economics in 2006, praised the Chinese for moving unutilized labor from West China to the productive factories in East China.
Edmund Phelps said China has yet to modernize its economy. Zhang Yuwei / China Daily
Phelps, who said he visits China frequently, said he was struck by the fact that Chinese are very worried about how they are going to modernize the economy but that they "simply don't know how to change the culture, how to change the institutions in order to have innovative companies and startups".
Richard Lesser, chairman, North and South America for the Boston Consulting Group, believes China will continue to grow, but wages will rise and the currency might appreciate.
He said over time the US manufacturing competitiveness should return.
Michael McCallister, CEO of Humana, a health insurance company, said there is a huge upside for businesses in the relationship between China and the US. "It's just up to both sides to find the right common ways for that to happen," he said.
While others talk about how the US should and should not learn from China, McCallister said China can learn a lot from what's happening in the US healthcare sector while trying to avoid duplicating the mistakes.
"China has a chance to build a healthcare system that is unique and better than anything and anywhere else, but it will be a big undertaking," he said, adding that his company is keeping a close eye on how China's healthcare system is going to fare in the future.
"As things clarify and if there is an opportunity, as a company we are very interested," he said.
Foreign readers are invited to share your China stories.
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