By Kenneth Norris, Deputy Editor, IFPTA Journal
NEW YORK, May 16, 2008 - China’s progress has been astounding so far, but history may hold the lessons for its future.
China is found in the numbers, and her numbers are staggering. Aside from the array of bewildering statistics surrounding a still-growing population of 1.3 bn people, her numbers also hide the intrinsic cultural references to the country and its future direction. With a current literacy rate over 90%, estimates state that by 2025 there will be more English speakers in China than native English speakers in the rest of the world. This number standing alone may point only to an emphasis of education achievement, but it also reflects China’s determined efforts to integrate with foreign firms and effectively interact in a world economy where English is the language of business.
In Shanghai, the Maglev train from Pudong International Airport to the Lujiazui financial district is the fastest railway service in commercial operation in the world. With a top speed of 500km/h (310mph), it was built as much to impress foreign visitors as with an eye toward reducing road congestion and air pollution. In another example, the Three Gorges Dam on the Yangtze River is 2,000m (1.4 mile) long and 185m (607ft) tall. Becoming the world’s largest hydro-electric project, and expected to be completed in 2009, its breadth is aimed directly at providing alternative energy solutions to alleviate China’s demand for coal and oil. However justified the criticisms may be, of overreaching goals, nearly absent ridership and potentially disastrous environmental consequences, it is hard not to be impressed by the scale of China’s expectations for its future.
Other numbers though are just as stark and impressive. China’s economy has grown at an average of more than 9.5% annually for the past 28 years, managing to avoid the pitfalls and technological barriers that stopped the other Asian “tigers” and, so far, the problems which led to Japan’s collapse in the late 1980s. In two decades, China has exceeded the urbanization, industrialization and social transformation that took Europe more than 200 years to achieve. This advancement has come at a cost. In the same breath, China is one of the world’s richest country (in aggregate terms) and also one of the poorest (in per capita terms), with many Chinese earning less than US$2 a day. Her environment has sustained the most devastating blow, putting some estimates of China’s “green GDP” (economic growth rate minus resource depletion and environmental degradation) over the last 30 years at near zero.
For the forest products logistics industry, China has become the fastest growing market for timber and paper pulp in the world. Like many other industries, China continues to increase its export of forest products, buoyed by an estimated US$400 bn trade surplus that is supported as much by protectionist measures and a fixed currency as chronic oversupply of manufactured goods, low-cost labor and a social regime of saving over spending. Imports are also still climbing skyward, reflecting the lack of domestic resources to meet demand. Deforestation is endemic to China, occurring today almost as much as it did 150 years ago, obviously with more pronounced effects due to advances in technology. To counter this, China has embarked on ambitious programs for forest development, using foreign investment to build up forest resources and develop new technologies for efficiency and reduced consumption. These are promising signs for the industry, but they still call for a weather eye on the horizon.
In many ways, China today resembles the voracious appetite and broad reach of nineteenth century America. With improving industrialization, cheap labor and the deferment of environmental concerns, America of the previous century moved forward at a breathtaking speed. This lesson has not been lost on the Chinese, who have ingested the American experience. James Kynge, in his book China Shakes the World, points to the efficiencies brought on by the development of the interstate and the Erie Canal as ways that earlier modernizing drove transport costs down and improved economic growth worldwide. These projects also held social relevance, as the Erie and the interstate were essential foundations of American nationhood. They played the part of opening up the West and improving commerce on the same level as providing economic and leisure mobility to the workforce. The Chinese have openly copied some of these aspects, labeling their new interstates with the same numbering and white letters against the green background as the U.S. And the Three Gorges Dam draws easy comparisons to the nation-transformation experiences of the Erie Canal and the Hoover Dam.
The economic dragon in the corner, angry or now, may have good reasons for wanting to hide. At times, it seems the whole world is starring at them. When asked if they consider themselves a superpower, a Chinese is likely to say, “Superpower? No. But a power, yes.” The astute humility and caution is appropriate. Too many challenges lie ahead for China, economically and politically. What would a global economic recession, with the drop in foreign investments and consumption, do to China’s progress? When and how will China’s environmental investments begin to pay off? These are only some of the questions looking for answers at the Ninth RISI Pulp and Paper Outlook Conference and the IFPTA Second Asian Regional Seminar to be held June 2 - 6, 2008 in Shanghai. These forums provide the perfect opportunity for a first hand look at the hiding dragon itself.
For China’s part, no one denies the late night studying around the country involves pouring over the lessons that took America through Manifest Destiny and the Depression to emerge as the leading economic driving force in the world. The dragon is determined to learn these lessons well.
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