Eric Li & Mato Njavro | On the US - China trade war; globalization, EU - China relations and more...

welcome to Croatia is the first time for you here right and when we met in Shanghai in December last year when I proposed to that you come here you were quite excited I would say so you knew already quite a lot about the country so it's good to have you here just for the benefit of everybody I'll give a brief introduction about Eric Eric is from Shanghai he's a venture capitalist founder of Chen Wei Capital which is a successful venture capital fund in China he studied in the US so he studied it is bachelor's degree at Berkeley and it is a MBA at Stanford and then PhD in political science at Fudan University he has a very successful TED talk that has gone viral some of you have seen it and it's really good to have you here in Croatia so the way we're going to do this session is I'm gonna give Eric about 15 minutes to to lay his case on the current state of affairs in the world which relates to to China and then we're gonna have a couple of questions for him and then we're gonna open it up for the Q&A I'm sure it's gonna be I'm sure you will have quite a lot of questions for Eric so hopefully we'll be able to answer all of them so Eric welcome thank you for the introduction good morning or good afternoon I'll be brief so we can go to lunch it's great to be in Croatia I love it it's the only country in the former Yugoslavia that I have not been to this my first time I remember many years ago 20-some years ago in the late 1980s and early 1990s when it was still in Yugoslavia I came as a student I was studying the history of the Habsburg monarchy so this was the frontier of the Empire I love this so much then and and the place has changed so much of course borders have changed identities have changed you know I miss the old days but I like the new days too today I have a big topic but a simple message the big topic that the organizers assigned me is the state and future of globalization and the message is a simple one I think you all know I you don't need me to tell you this the globalization is in trouble it's in big trouble if you don't know this you're really out and we're not going back it's over of the globalization so we know it and here's why let me explain in the second message work globalization continuing some form and how and I think it will and I think it should and if we do not foster a new kind of globalization the world will go backwards and no one in the world would know better about what going backwards means than the people in this region I know the history so globalization that's brief review of history started as a concept it's a very innocent concept in the 1970s it simply meant that driven by economics technology and the movements of people there will be increasing can interconnectedness or interconnectivity among peoples and nations of the world ok so it's a really simple concept it started in 1970s but it experienced a qualitative change in the early 1990s after the Cold War at the end of the Cold War and and I like to make the distinction between globalization and globalism at the end of the Cold War that was when globalism as an ideology was injected into globalization and I call it hijacking globalization and the ideology of globalism was essentially based on the doctrine of neoliberalism and in it manifested at a practical level through what was called the Washington Consensus and at that time the US and its Western Allies led a drive to universalize Western values and those Western values has three components politics economics and international relations in in the political arena it was too liberal it was to universalize the system the political system with liberal democracy economically to universalize the economic system of market capitalism in international relations a set of institutions to manage the relations among nations whether it's IMF a WTO or what-have-you okay and the idea was that we're going to an era where when universal standards based on Western values in political governance in economic management and international relations will spread the world over so everybody would be would be doing things in the same way by the same standards around the world regardless of where you came from what your culture is or your political system is everybody will be the same ok and looking back in the last 20-30 years I must say that England respect Loeb ilysm was a great success I call it the great conversion what was the great conversion if you look at the numbers in the 1970s or 80s there were I don't have the numbers in front of me but you could search online okay based on this rating of a Freedom House in America or The Wall Street Journal Heritage Foundation ranking of liberal economies of free economies you will see that in the 70s or 80s before the end of the Cold War there were only maybe 40 or 50 countries who were classified as liberal democracies and maybe similar number as market economies now the number has doubled or tripled never in the history of mankind has so many countries given up whatever political system or economic system that they had adopted something totally new okay so that was a great success but globalization this globalization globalism globalization injected with globalism has also generated great failures what are the failures let's look at the new countries that adopted the Washington Consensus the neoliberal adoption that in the 50 or 70 or 80 new countries yeah I group them into four groups mostly first group I counted about 29 countries those were the former Soviet states and former East European Warsaw Pact countries okay and that's the most fortunate group this group has done better than any other group however even among this particular group there are probably fewer than half of the countries that you could say have truly achieved success most of the Caucasus countries in the Caucasus in the stand countries so-called are not successful Russia itself was not successful for a long time Ukraine being the worst one of the worst and even in Eastern European countries if you look at Hungary Poland many of those countries are regretting many of the things they adopted and they want to change and they're fighting a battle to change to regain their national sovereignty and to regain their ability to to how to run their countries okay so so there's a lot of dissatisfaction although this group has the highest number of success stories you know Croatia is one of them Czech Republic Poland seemed very successful okay but of that group maybe only half or moderately successful second group are countries and regions that achieved developed country status under authoritarian dictatorial political systems and then they adopted the Washington Consensus liberal democracy and market economy after they got rich okay in those places for example or like South Korea Taiwan South Africa places like that yeah of those the record was about 50/50 at best South Korea continued to succeed Taiwan has been deteriorating South Africa has been deteriorating okay not doing so well that group third group was the largest the large number of developing countries from Southeast Asia to South America to Latin America to Africa you cannot find one success story that's the amazing thing virtually all of them are still lagging way behind on development a poverty level those who are fighting civil wars are still fighting them at least in civil strife mmm the the globalism has not solved any of their problems and only made them worse okay in the fourth group I don't even the latest group later addition to that column of course all the countries of the Arab Spring and I call it the Arab winter you we all know what happened to them okay not one came out ahead every single one of them came out behind way behind so globalism in the developing country and let's look at globalism in a developed world it's doing even worse globalism let go polarization created tremendous economic benefits we see that in the economic numbers GDP profits what have you ok for the developed countries America and Western Europe but vast majority the most of those benefits went to the very top the middle class in all those developed countries has been collapsing it's the amazing thing if you compare China and America for instance both countries benefited tremendously from globalization okay if you look at GDP growth look at surpluses they've all gained a large amount of wealth but China's GDP grew 10x maybe around okay and China's medium income grew about eight times in America America's GDP grew also tremendously four or five times from a lot much larger base yet their medium income has been dropping stagnant and dropping isn't that amazing where has the money gone if you go to Paris go to the streets on Paris every weekend you see them wearing these yellow vests and they tell you where their money is gone okay and if you go even in Germany Germany's most successful country in Europe there's so much dissatisfaction so so we see a tremendous backlash against the elites who led this wave of globalization of globalism and that's I think only intensify and spread so what does that have to do with us China has been the only exception among just about any other amount all major countries in the world China was the only one who engaged globalization and benefited from globalization the most yet it rejected globalism decisively it said no to the political system of liberal democracy it said no to market capitalism it was pointedly not market capitalism it's socialism with Chinese characteristics which is fundamentally different so but some form of market yes not capitalism how do you distinguish oh I distinguish them simply by saying that in capitalist society in a country of capitalism Capital is is an independent power capital can determine the future of a country in China in a socialist country we have tremendous capital great entrepreneurs lots of wealth but capital is beneath political authority our national political authority will never allow capital to determine the future of our country you all right in America hundred wealthiest people in America we have an outsized influence on the future of an American political establishment and the direction of the country okay in China the wealthiest country the 100 or 500 wealthiest Chinese people we have zero influence over a Politburo in our Central Committee zero okay so so that's the difference between a capitalist country in a socialist country so in the role of capital or capital of course is borderless capital is not committed to the land capital is not committed to culture capital goes whoever it can make the most money so it's different and that's why you see all this backlash in developed countries and developing countries alike because people's live people want their lives taken care of they don't want to just be be ruled by by capital so so China is the only country that's been successful in this globalization processes developed tremendous economy became the second largest economy by nominal terms and largest by PPP it's now the the largest trading nation in the world by far and the largest trading nation in history by the way 100 I think hundred 15 120 countries count China as their largest trading partner only 63 can the US as their largest trading partner so so we we've done this and we've lifted 800 million people out of poverty in the process and continuing on that process we're not there yet now something else is happening in the world the United States and its Western Allies but the u.s. is leading this confronted with these problems of globalization seems to have decided to lead a effort to deconstruct and destroy the institutions of globalism that it built okay and that's one precedent it's never happened sort of in the history of conflicts if you read the Graham Allison's latest book about destined for war conflicts my great powers I was talking to him I said have you have you seen an instance like that like this he said no what is it that the leading power the incumbent leading power is dismantling the system it built by itself for its benefit it wants the ditch and of course you have all those other countries especially in Europe have build their systems based on the belief of that the us-led system will continue forever for another 2,000 years you're in trouble what are you gonna do okay so that's another interesting and amazing thing and present anything that's happening in the world so what are we proposing we look at 16 plus 1 or 17 plus while we look at broaden roll initiative China I think is proposing a new form of globalization a globalization has liberated from the ideological shackles of liberalism a globalization that's not ideological a globalization that allows the space for countries to develop their own paths that does not seek to impose a set of political economic values on to other countries a globalization the respects national sovereignty it respects differences a globalization of diversity of plural ism to call it and and President Xi Jingping used to say that it's like a pair of shoes whether or not they fit only you could tell when you walk so so the so I think that the Chinese approach is gonna make a difference in the world I hope as through the spelled enroll initiative through 17 plus ones through other initiatives China's proposition is to still with nascent propositions a new proposition there going to be a lot of problems a lot of issues but it's a new idea that I think the world should entertain which is that we would want to promote interconnectivity promote globalization but respect cultural and civilizational integrity respect national sovereignty and that each country discover and pursue their own development paths thank you thank you [Applause] you mentioned countries like South Korea Taiwan that have gotten rich essentially during the periods of dictatorships and then eventually liberalized and became democratic some have hoped in the West that this would happen with China what do you have to say to those people with those aspirations they did have those aspirations but but we didn't do it and we came out ahead so I'm a venture capitalist I look at results if you you know look at these other countries who liberalize like I said I countess you know I use three examples a countries or regions South Korea Taiwan and South Africa you can count some Latin American countries like that to Chile or whatever if you look at those countries I will say South Korea is the only real success story after they liberalized they continued to prosper and grow and the other countries among them some one really deteriorated badly someone just stagnant not going anywhere yeah okay so a bad track record bad record do we have any questions from the audience before I continue with Eric okay maybe then Eric how do you comment what's currently then you mentioned briefly that the US is in a pretty unprecedented way dismantling the system it helped built in the first place and how do you feel that this trade war that is currently taking place will play out and what would be China's reaction to it I mean we can't say we didn't see coming eventually especially from the American side it feels now that there is a consensus both on the Republican as well as the Democrat side that and that is very entrenched against China in a way so even if the next president turns out to be from a Democrat side I don't really feel that his or her view on China will will shift dramatically so no I I think that's correct I don't know how the trade will play out I'm not in the negotiating room but the trade war is needs to be understood in the context of a larger scale competition between these two countries and I think that will continue and I think there will be more competition not just between China and us but many other countries like Russia Germany so sources so we're in a in a new era where somehow I think Europeans but in particular had this thought I think it turned out to be an illusion that somehow we're gonna build this so-called liberal rules-based international order where everybody will operate under certain as this set of rules and it's over now it's an era of everybody competes everybody fights and there's not gonna be a set of rules that countries respect so that we're gonna see an era of hard power unfortunately and not because of I think because of the failure of the soft power era the soft power didn't deliver this rules-based system didn't deliver for the for the people and unfortunately I wish they had delivered by didn't so so we're an era of hard power competition and Europeans in a very tricky position because Europe had not believed in hot power that is correct I mean Europe only recently started thinking about only after President Trump really forced Europe to think about their own defense budget and strategy that we really start considering it more seriously but I mean isn't this situation dramatically different from the one that we had during the Cold War when we had two superpowers one was completely autarkic and practically it wasn't really communicating with the world now we have like I mean a marriage between two superpowers with interlinked supply chains with interlinked economies so I mean this marriage cannot easily be broken right it cannot be easily broken but it could be damaged and I think the u.s. now is I think the u.s. the current US leadership is wanting to draw down our and curtain of some kind to to decouple with China other economies too because and I don't blame them I think the US has great advantage great strengths to compete and win in the in a world of era of what I call warring States there's a theory in Chinese history where where everybody fights was no interests okay in China a 5-4 thing just to but-but-but I think that would be unsettling and risky period I think we ought to be looking to reconstruct a more peaceful order and I think Chinese proposal needs to be heard and I'm paramount Chinese leader than shall being once said that you know China should kind of lay low and buy their time essentially implying that China still has a lot to to catch up now obviously this was a decades ago in 2008 during the global financial crisis many of the leaders of the West were traveling to Beijing in hopes that the Beijing continues buying the government bonds of you know both the US as well as many European countries do you think China overplayed their hand by being a little bit overconfident from the from interpreting the global financial crisis of eight as a major decline of the West especially of the US Oh in other words like what is the is is China now a little bit surprised with all this backlash and it's happening especially coming from the US I think it's the opposite I think China was too timid I think China didn't realize the tremendous earthquake of 2008 financial crisis I think China didn't see how fast the Western political institutions were decaying how much incredible dissatisfaction there is in developed countries how how rapidly the social contract in America has been being torn apart as China didn't realize that so I think China under played his hand instead of overplayed it I think China should have been more forward in proposing its ideas to the world how we should continue to interconnect yeah but from what you say I get a feeling that you know the West is kind of has the political system to blame for the for the fact that it completely made the middle classes of the West miss out on the benefits of the globalization now if that is the case then why are they so angry at China and not their own political I think the anger is misplaced like I say if you look at the numbers the US and Western countries benefited just as much if more than China it's the the problems within those countries the benefits only went to the very few and a large number of people came out worse off or as our stagnant and most people feel less secure most people feel they've lost control of their destiny to nameless faceless global institutions like the EU you know I was talking to a friend of mine about the Euro he was an economist you're not in the euro I guess no not yet and we the globalist don't understand there's something more important than money all the globalists could see is money money money money and the economists you know gave me a list of the benefits of the euro okay economic benefits I said well look that's all good but but I don't care I would I would not want to be a citizen of a country in which I take out my wallet take out my currency and I don't see my hero my national heroes picture on it well have you ever heard of venture capitalists talk this way about money how do you get your investors to invest I mean with this kind of a enlightened perspective no it was so so so people are more complex than that people people need dignity people in the community people need the sense of belonging people need cultural integrity civilization or integrity so I make a pitch don't join the euro and but then what role do you think China has to play in promoting the alternative form of globalization because if I understand you correctly I mean the main message of China's let's say view of globalization is that you know the globe the value system cannot be exported and then every country should kind of countries need to be able to develop in their own ways and China wants to take its access capital and its capacity to build that the Chinese have have learned one thing one lesson in the last 40 years and went from a agrarian poor country into a behemoth and there's one lesson they learned it's called I heard it everywhere I hear it you know people talk about China if you want to get rich build a road know what a road I wrote yes so infrastructure led development and infrastructure physical infrastructure for digital infrastructure as well right so so China is trying to take that idea and say that okay we'll take our access capital access capacity to build infrastructure being physical or digital in countries that are connected to the Chinese economy so that we could increase interconnectivity this way between China's economy and their economies that's what the road is about I mean I remember five six years ago and started building I was in Chongqing and saw the terminals it was gigantic and now it's straight to my trip to London okay so along the route obviously or in improved trade improve investment environments and and bring hopefully bring development and prosperity in those countries and hopefully they'll come back and benefit China okay but it's up to those countries to decide how they want to do it and how they want to run their countries how they want to run their politics and their economy and they could for instance Malaysia Oh China had these big projects in Malaysia as big financing big borrowing and they changed government president Prime Minister Mahathir came to power and he he said that some of those deals were not good deals for Malaysia so they but they renegotiated China cut the price by 30 and changed certain aspects of the transaction and they're back on back on track so so check the Chinese are saying you decide how you want to run your country and your sovereign power we're not gonna impose our standards on you you've traveled to Africa a lot you are on the board of China you're a business school and I think Ghana right and China has had quite a significant interaction with many African countries what have you seen there from your experience I mean I think we've had a lot of successes there we've also had a lot of problems Chinese companies did not have a lot of experience expanding internationally so they made mistakes higher didn't hire local people so so there's resolving solving some of those problems they're getting getting used to it but overall I think the China's development projects in Africa had been successful I think the numbers I saw don't quote me on it you should you should double-check the the rows that we build in Africa in the last 20 years or more than all colonial powers in Africa combined did in the last 400 years that's impressive at this point I'd like you all to point I get the point there at this point I'd like to open the floor again for for some questions from the audience there's one over there hi thanks mr. Leone your your talk I'm a majority and I come from one creation think-tank Center for you know of culture and we as a free-market and conservative think-tank could agree on some points that you made about globalism my question would go on this globalization part what do you think why China doesn't tell still doesn't allow Facebook Google New York Times Instagram and Wikipedia for example to just be allowed there thank you it's because we believe that each country should have the sovereignty to decide what kind of ideas dominate their society we respect countries who don't believe that you can't let any ideas in if you wish but we don't we believe speech is a form of act and just like any other acts need to be regulated we respect countries will say speech should be completely free and say anything you want that's okay if that's how you want to run your country but we don't believe that yes okay my name is Steven Barr Toolik I teach political philosophy at a Catholic University here in Zagreb I enjoyed listening to your remarks and I would agree with you on the euro for sure I'm very skeptical about the wisdom behind this project and it could lead to more fragmentation than unity among these countries as Milton Friedman predicted before it was introduced so I think there's much that we should learn from these countries that are in the eurozone but I wanted to go to a more philosophical question so as you know in 1989 the trees in Central and Eastern Europe rose up against communism you mentioned dignity and other things that you think should be respected and the people in these countries of course felt that their dignity was not respected under these regimes and they rose up and many of course have not found their way and if in many many of these places have maybe stagnated and the elites have not found the proper model how to advance since the collapse of communism but it is true that someone I admire greatly john paul ii grey gave the people of Poland and other countries great encouragement to metaphorically take off the the chains that were keeping them down and to rise up and and demand their freedom and dignity and it's interesting that since China's rise I think the Communists there have learned very much from this experience so john paul ii badly wanted to visit china he wasn't allowed as you know pope benedict as well but Western capitalists bankers JPMorgan Goldman Sachs Apple they're all welcome in China so what does that tell us about you know this divide on how we see human nature it seems that the Communists in China have more in common with Western capitalist than they do with people running the Vatican and I think that tells us a lot about what's at stake in this game that we're describing so thank you very much good question thank you I think you're right the the revolutions in 1989 in early 1990s were driven by genuine national aspirations for for the peoples of these countries to to control their own destinies okay and to use your quote of john paul ii to to liberate themselves from the shackles unfortunately they put on your shackles the new shackles of liberals that was my point a new shackles of globalism they went into a new model without considering their own national conditions that's why they're still in the wilderness I think I think we want we mean I like to see a more pluralistic world where countries are able to say ok don't impose your values on me let us consider our own national conditions let us consider our own cultural conditions and we're gonna find a way that's suitable for us and on the point of of capitalism and capitalists in China of course that that's what we met we have a vibrant market economy and China has decided to engage global globalization in its own way on its own terms so we engage and let in what we believe benefit us we keep out what we believe will harm us like the others other gentleman raised so do do the it is really the the Holy Father such a threat to the regime that if he would visit China they would feel that it could undermine their their authority like it like it happened in Eastern Europe no I'll be I think the the current holy father will be within each Anacin that's not bad but I will say that it's up to us to decide who can visit my house I don't need someone else to tell me who I should must invite into my house into my living room I don't like that I don't think you'll like that either I don't care what reason you give what rationale you give what moral lessons and lectures are going to give in my house I decide purely I might this question who can sit in my living room and I want to follow up on that I can completely understand that point but over the last decade or so I mean the markets of US and Europe work as they are the quite open right and they were also open to Chinese investments and Chinese companies could easily go to Europe and buy one of the most significant food companies like Syngenta no problems right as long as you have the money and you conform to the laws there the similar cannot be said exactly but look at those countries who did allow look at all the code look at Russia look at Georgia look at all those country in the former Soviet they lost all of their economy okay their companies got bought up she played by foreign investors by oligarchs they lost their own entire economy they have nothing now thank God we didn't do that no I understand pletely understand yeah it was there one question over there yes eirick thank you for coming again for your talk my name is deborah torch and I'm an entrepreneur I have a question on the political system in terms of how does China ensure that capital doesn't affect the political system and also what type of political systems do you see developing in terms of Europe and other Western countries because clearly this to this current political system I'm not sure we'll be able to deal with the globalism that you've discussed or dismantling it and there will be a natural consequence of changing the political systems so how do you see that developing I think well in China obviously it's a it's it's a it's a fact of the system that private capitalists are not involved in political decision-making there allow the space to make money and they probably allow the space to have some influence over policies that affect their industries maybe maybe but not even that the the China's political system is completely independent its couple economy independent of economic and capitalist interests there's corruption of course I'll give you that for that's illegal and how I see Co systems evolving Western countries I think we're gonna see more and more democratic movements against libel liberalism so liberal democracy is breaking up inside the liberal and the Democratic are increasingly at odds with each other as Hungarian Viktor Orban said that it claimed that Hungary today is an illiberal democracy so so we're gonna see democratic forces saying that we want to take our country back from liberal Assad oxy I think that's what that's what we're gonna see in the devil in developed countries including in America to follow up on that note if we do go down that road right where you see more and you kind of already see it I mean we have the European Parliament elections coming up here and in many countries in Europe you see these populist movements rising and they just haven't completely aimed their crosshair at something and then what you have is you have a somebody like Steve Bannon former advisor to President Trump who comes to Europe and and tries to frame China as the problem that all these populist movements should focus on the yellow West you mentioned the five star movement in Italy I mean isn't the danger I think he's mistaken and I think the Europeans are too smart to buy that story you know there in Italy but Italy is the first developed country they signed up to broaden ro initiative with the current current nationalists if you want to call it populist government I don't think Hungary is buying that story you know so it's okay for him to believe that but but I think he's mistaken like I said they made the US made just as much money if not more than China so it's they didn't you know it's how the money was distributed inside those countries that was the problem you can't blame the politburo Chinese Politburo how they divided up their money their profits the Chinese Politburo didn't have a say in that and I think Europeans understand that and I think most Americans would understand that too yeah any other questions yes can you just take the microphone hi my name is Ivanka I teach realization so maybe going back to the first presentation with those maps of 16 plus one initiative and foreign direct investments of China to Europe we saw that the countries of 16 plus one initiative had very low level of FDI C so you as a venture capitalist how can you comment on that and what's the opportunity that you see but for Chinese entrepreneurs and those of the 16 plus one initiative in that context I think well I think the gap is the opportunity have certainly Chinese economic engagement with Europe has been broad and deep with big numbers but it's been mostly concentrated in Western Europe the the eastern europe and central Eastern Europe pink country had laid behind a significantly but I think that's that's the opportunity I think obviously when Eastern East European Balkan states when they joined the European project they their economies are geared towards integrating with Europe and that's natural but I think we're in a new era where I think I mean I personally think Europe is falling apart the European project has run aground and it's not it's it's not gonna get fixed in each short period of time so the economic gravity is gonna shift I think you will be much better off developing alternatives instead of you know continue this headlong integration into a Titanic a sinking Titanic you might want to find a few more boats and I think that's my pitch to you any other questions yes over there in the back hello my name is ami so just briefly let me give you a story about Croatian in Croatian economy so in ninety but briefly briefly in 1945 we embraced socialism like China today and our government decided to build roads and to build industries like China today and next 30 years the the country began to grow so like China our GDP glow will grow like ten times this whole city actually grow like five times see this is this in 30 years from 1945 sorry to 1975 let's say well what happened after that time is actually that we began to stall and our economy began to stall because the current regime and socialism in a capital allocation didn't work anymore and for 10-15 years 20 years before the transition which is not which positive wasn't only about the people it was also bad economy because the economy could not find a way to grow up further what looking at the China today and looking at the creation back then the reason for the GDP growth was not only that we experienced great leadership and in the socialist parties because the people came from the villages to the series to the series and most of them just increased productivity because they were living in a cities similar like we have in China today so what what makes you confident that China isn't just lagging what happened in creation 3040 years ago because looking at China today you have 30 or 40 years of growth and an excellent road as I said you raise hundreds of millions people from the poverty but what makes you confident that actually you're the way that china is operating today won't hit a wall in 10-15 years especially when we look at the Chinese finances the grow of death patel's capital allocation and everything that we are thinking about today and actually when looking at the Socialist Party and reforming the country do you believe that China could do the same as Croatia didn't entitles to transition from socialism to democracy it is something that would a Chinese party do if they feel this is best for Chinese people thank you it's interesting to hear your recounting of Croatian experience over the past half century or more you know we had the similar experience we in the first 30 years of the People's Republic from 1949 to 1979 we had a strict socialist system five-year plans central central Canada Khanna me some people say it's a failure I disagree we build tremendous base in industrial infrastructure in 1949 our life expectancy was 41 years old I've already lived past that okay and in 1949 our literacy rate was less than 15% you know child immunization rate was like below 1% electricity coverage only covered maybe you know less than 5% of the country mostly in top few cities okay in 1949 were much much much poorer than you much much poor and after 30 years of socialism total socialism what I mean we made a lot of mistakes like Great Leap Forward Cultural Revolution but the successes are tremendous in 1979 our life expectancy is already well instead in 60s our literacy rate was 85% which means 100% of the of young people okay and and our immunization rate was 100% electricity coverage China is a huge country is above 80 percent okay so I would argue without this socialist period we would have never taken off after the thin shopping in a 10 shopping era with market reforms you know an interesting thing that the people discovered was when we started building these cities and building those highways in the last 40 years Chinese migrant workers who came from the countryside migrant workers who never finished you know just barely finished elementary school could read and engineering joy how to build so we had a highly educated population even at a very low GDP per capita in fact if you if you check the UNDP United Nations Development Programme called Human Development Index in 1978 at a very very low GDP per capita China's Human Development Index was approaching those of developed countries okay so but we had that yet our economy stalled it couldn't go further we had this so we changed we reformed we said okay we're going to keep what was good about socialism we still continue the five-year plan but in a different format obviously it's not totally command economy and we brought in tremendous market elements market characteristics pricing was allowed to be determined on the margin by market forces and gradually opened up market and trade so so that's those the last 40 years in the next phase in the next 30 years we faced a different set of challenges we've grown tremendously but our inequality has increased so that's that is on top of a political agenda we're worried about productivity yes but we're more worried about sharing the prosperity we don't want to leave people behind like the liberal global is written getting their rich countries we don't want to do that so so the idea now idea is to eradicate absolute poverty and we're well on our way in the next four years we have I think 30 million people left living beneath the absolute poverty line defined by weather was the World Bank or whatever the organization is and and and we in the next three four years we're going to take that to zero to zero okay even rich countries cannot do that and we're still a developing country at only ten thousand maybe eleven thousand US dollars GDP income per capita we will not take our absolute people under absolute poverty line to zero in the next 3-4 years we need to expand our health care coverage we need to redistribute gains of the in the last 40 years from from economic growth so those are the priorities and that's the new era and so I'm I'm predicting a shift away relatively away from capitalistic approaches to more socialism in China so we we've won from total socialism in the first 30 years to 10 shoppings the market reform and more not capitalism but capitalistic approaches and I think the next 30 years we're shifting back a bit to have more socialism there's one question yes I would like to I'm coming from one of the Croatian banks at first thank you for very very dynamic and interesting speech I think that we heard many interesting and useful information I personally agree with some of them I don't agree with it all of them but my question was related to European your opinion on you you said that it is falling apart so I would like to ask European opinion why do you think so and secondly if this is going to be the case how do you see and what could be alternative for a small country like Croatia's and maybe just small comment at the end of the day how do you comment is happenings regarding for away from outsider I'm not a European so I'm speaking out of outside my expertise and I'm just looking from the outside in okay you tell me if that's true okay why is your falling apart I put the question back to you who are these people in Brussels do you know them I I don't I can't even remember their names they're taking these volumes and volumes of books and rules it they're looking at this and KO number 17 number 18 you you do this this way you you do it that way someone may not even be being into to your country okay I think that's why Europe is falling apart it's to top down the people peoples of Europe of the European countries have given up given away too much power that they've lost control over their own destiny I mean with the euro for instance I mean countries like Greece and Italy cannot even re-engineer their economies when they face tremendous challenges because they're locked into into this currency that's not theirs that that's that's not connected to their economic realities so I mean I think that's why Europe is falling apart one more question over there my name is million crush image there is a one question I need to ask regarding well your idea of pluralism because you have mentioned pluralism several times but it seems to be a pluralism of nation-states rather than pluralism of people inhabiting these nation-states so if history has taught us anything it's that as people get better off economically they increased demands or more political rights so does China have a fail-safe or some kind of a strategy to face-to-face these demands for democratization that are likely to gain currency as people become better off other than other than say things such as increased control in terms of you know social credit system or some more violent measures thank you I think you don't have to wait to be rich for people to demand control over the destiny of their country rich and poor countries people assert themselves and I think that's that's a good thing and people are doing that in America people are doing that all over Europe the British people just did that in the referendum okay the people in Poland are demanding their borders back people in Hungary are demanding their borders back and their control and immigration the people of Hungary and Poland demanding their own control of their judicial system instead of following the dictates of Brussels foreigners in Brussels this is what the people are demanding and and and and and whether a government or political leadership can survive in the long term depends on whether they answer the will of the people so the test is in history so the Chinese Communist Party is doing power in 2050 that will mean that they've answered the demands of the people otherwise they'll be overthrown just like the Liberals in Europe everywhere are being overthrown because they've refused the demands of the people they only care about the capitalists they only care about their their liberal values and they they refuse the cultural integrity of the lands of the people who live in them so you mentioned pluralism yes I do believe that plural is among cultures of civilizations that pre-eminent saying because a culture is the is the primary driver of human civilization the culture is the fundamental entity of how we organize ourselves and within culture it's up to you you want pluralistic within your culture that's ok but it's ok for another country another culture to say that we only want this kind it's ok to and I see many movements inside European countries who-who the people in those European countries are want to say no to Brussels who wants to impose liberal values in their own countries they're rising up maybe one last question ok over there hello my name is Marvin and at the moment I'm is the same student I like to ask you mr. Li what and how you see the cooperation and collaboration between China and Croatia in next three to five years I hope although I know you have limited quantity but I hope you sell more wines to us it's amazing I love the wine and I hope you have seen more Chinese tourists in Croatia I was in Dubrovnik yesterday and it's a beautiful beautiful place did you see the bridge which bridge wonder the Chinese company no no I haven't seen the bridge I want to drive on the bridge so it's not completed yet but yeah well when it's when it's completed then you can come and yes drive good more Chinese tourists more Chinese drinking Croatian wise and and I hear Oh olive oil is the best it's amazing I didn't even know about this it's better than its Italian and Spanish Holly why I'm telling you okay and the Chinese don't know that okay you need to tell the Chinese about your olive oil okay and minerals amazing minerals where we need that and you're in a strategic location along the trade route so you need to take advantage of that we have like I said infrastructures not only physical but also digital I have this initiative to study what I call the digital Belton Road so smart inventory for instance digital management of logistics mobile technology all of these things I think Croatia could play a role in in the larger cooperation larger code development between China and in the European continent and maybe one last question from my side since you mentioned the digital belt and Road I mean the digital Belton Road took a significant hit just what yesterday when president Trump would huawei on a on a blacklist a similar move to that he has done to another Chinese companies et so I do you think what we can I think it's ready for this can it survive I think while we could survive it's invest a lot in R&D it obviously I heard it for in the short term but it's okay I mean China is a big country America is a big country Chinese companies are big boys they should be able to handle it some of them may get hurt some of them may even get better in the long term it's it's an age of competition but but China wants to increase can interconnectivity especially with European countries and that's where I think you will have a constructive and profitable role to play Eric thank you so much for joining us here there's a pleasure [Applause]

Channel: ZSEM Croatia

Views: 249,845

Keywords: NEBF, ZSEM, Eric Li, 16+1, youth forum, zagreb school of economics and management, zagrebačka škola ekonomije i managementa, Mato Njavro, New Europe Business Forum

Id: wdxPcmSWBXQ

Length: 63min 41sec (3821 seconds)

Published: Wed Jun 26 2019