Multinationals Show More Passion and Confidence in Investing in China
An Interview with David Aikman, Chief Representative Officer, China; Member of the Executive Committee, World Economic Forum
By Li Shaohui
On October 19-21, Department of International Cooperation, National Development and Reform Commission (NDRC) and the World Economic Forum (WEF), jointly organized a visit to Hangzhou and Yiwu of Zhejiang for 17 multinational business members of WEF, in an effort to know more about the business environment and featured local industries in China.
After the visit, the journalist made an exclusive interview with Mr. David Aikman, Chief Representative Officer, China; Member of the WEF Executive Committee, trying to get his answers to the following questions: How does he think of the visit to Zhejiang? How does he view the Chinese economy? What are his comments on business environment in China? What are his suggestions on deepening reform and opening up in China?
“The visit to Zhejiang helps me confirm three things”.
Journalist: Can you please tell us what impressed you most in the visit?
David Aikman: In Hangzhou and Yiwu, we’ve seen courage and innovation in recovering from the COVID-19 outbreak. The visit to Zhejiang helps me confirm three things.
First, Zhejiang attaches great importance to the development of digital economy, which helps Zhejiang quickly resume production and restart economy in the fight against COVID-19. For instance, through the Hangzhou City Brain, citizens gain access to digital medical service and transport while enterprises get quality and convenient service and government upgrade administrative efficiency. Another example, in the government-business symposium, the enterprises gave high praise to the “one-stop service and one-in-all service” in 365 Hall in Yiwu. From what the entrepreneurs said, I learned that Zhejiang does have wonderful business environment thanks to the development of digital economy, which helps mitigate the COVID-19 impact and facilitate economy recovery.
Second, Zhejiang attaches great importance to innovation and
creativity, which is the secret of its economic revitalization. For anyone wishing to understand the power of small commodity economy in China, Yiwu is a must-be destination. Nowadays, Yiwu not only produces and sells small commodities. Even more, it emphasizes innovation-driven development of industries with high added value, such as LED and hybrid engines. Yiwu is also an epitome of economic transformation and upgrading in China. At the same time, Zhejiang highlights the significance of human resources. The Dream Village in Hangzhou encourages young people to make innovation and start business there.
Third, Zhejiang emphasizes on combining traditional and modern elements. Digital infrastructures are available in old buildings; science parks and culture parks are built in natural environment. Only China can smartly combine historical and modern elements.
For me, this is really an enlightening visit. In cities like Hangzhou and Yiwu, and in provinces like Zhejiang in China, people have the ability to promote economic growth by highlighting local characteristics.
“I believe the Chinese economy can avoid K-shaped recovery”.
Journalist: During the visit, it happened that China revealed major economic indicators for the first three quarters. How do you view the Chinese economy?
David Aikman: The World Bank predicts China will probably be the sole major economy that records positive economic growth this year. I believe that China is able to avoid the K-shaped economic recovery, which is not an ideal model. K-shaped recovery means widening wealth gap in the pandemic period. In developed countries in Europe and the USA, the rich are able to retrieve their loss in the pandemic. However, things might get worse for the poor, who may sink into deeper financial difficulties and find it impossible to recover. China has its own governance mode and a number of measures to alleviate poverty and keep employment, which enables China to promote economic growth, while securing the public welfare.
China’s long-term economic growth also relies on the development of global economy. In spite of the robust economic recovery in China, the severe COVID-19 situation in Europe and the USA will lead to drop of overseas demands for Chinese goods. Just like the first flowers about to blossom in early spring, the Chinese
economy might be impacted by the chilly wind of the slow recovery of overseas markets.
At present, China is working hard to expand the domestic market while accelerating the establishment of a “dual circulation” development pattern with the domestic circulation as the mainstay and with domestic and international development reinforcing each other. This is a wonderful practice. Developed countries should learn from China when trying to recover and rejuvenate their economy.
In light of the complex situation of the global economy, WEF initiated the global dialogue in September called “the Great Reset”, calling upon all economies to consider ways of rejuvenating the economy and finding a long-term plan for sustainable development.
Considering the possible safety risks posed by COVID-19, WEF will postpone Annual Meeting 2021 to May next year in the suburb of Lucerne, the famous tourist destination in Switzerland. The WEF Annual Meeting 2021 will mainly discuss solutions to the most urgent challenges faced by the world. World leaders will work in concerted efforts to design a common “path toward recovery” and rebuild the society with greater cohesion and sustainable development. At the end of January 2021, WEF will continue to hold the online high-level Davos Dialogues, inviting major world leaders to share their views.
“Many actions in China are praised by the world”.
Journalist: Each year, WEF would publicize Global Competitiveness Report. After the visit, how would you comment on business environment in China?
David Aikman: Since 1979, WEF has published the Global Competitiveness Report on an annual basis to evaluate business environment of more than 140 economies in the world, hoping to provide reference for countries to enhance their international trade and promote foreign investment. We hope to, through the Global Competitiveness Report, improve the openness and fairness in the trade environment of all countries.
Many actions of China are highly praised by the international community. We are pleased to see that the Chinese government has taken a series of measures to open wider to the outside world, in particular the dual circulation development pattern put forward recently. I hope China can treat Chinese and foreign companies as equals and create a level playing field for them, and thus help the Chinese economy upgrade to a higher level with higher quality. The Chinese companies should have confidence in competing with their foreign counterparts.
“WEF always supports reform and opening up in China”
Journalist: China is showing greater boldness to promote reform and opening up at a higher starting point. What are your comments and suggestions on it?
David Aikman: WEF always supports the reform and opening up in China, paying great attention to the process. In 1978, Professor Klaus Schwab, WEF Founder and Executive Chairman, keenly sensed the upcoming profound changes in China. In 1979, he came to China for the first time, inviting China to send a delegation to WEF Annual Meeting in Davos, Switzerland. Over the past 40 years and more, WEF has been in friendly cooperation with China, holding Summer Davos in China, inviting Chinese national leaders to WEF Annual Meeting in Davos and working together to promote the Belt and Road Initiative. WEF has witnessed the great process of reform and opening up in China. In December 2018, the Chinese President Xi Jinping granted Professor Schwab with the China Reform Friendship Award to express recognition of the role the Professor has played in China’s reform and opening up and of his contributions in the past years.
We are pleased to see China is accelerating the reform and
opening up. Against the backdrop of rising inward-looking and protectionist trends in more and more countries, instead of following suit, China is promoting reform and opening up with stronger determination.
As for the suggestions, I think China, while proving its conviction of opening wider by actions, should also tell how many efforts and achievements it has made in the reform and opening up, instead of just explaining the policies. WEF served as a good bridge and platform in this visit. Through the visit, senior executives of multinationals have the opportunity to deeply understand the improving business environment in China and prospect of local industries, thus building up their confidence in investing and pursuing long-term development in China.
WEF hopes China to tell its stories to the world on this platform. WEF is dedicated to promoting exchanges between the Chinese and foreign companies. In particular, WEF hopes the Chinese companies can use the platform to get more actively involved in international dialogues and tell their stories to the world. WEF is ready to continue to be the partner of China and make our contributions to China’s process of deepening reform and opening up.