Political and economic reform cannot be separated – Arthur Kroeber

Economic and political reforms have to go hand in hand, economist Arthur Kroeber argued at a forum on the new leadership in China, organized by the state-run Global Times on Tuesday. In a summary by the Global Times.

The Global Times:

Arthur Kroeber, managing director of GaveKal Dragonomics, … added that separating political and economic reform would be difficult since many of the economic questions facing the government are political ones.

He explained that the former model of growth depended largely on the mobilization of capital, with little to no worry about efficiency or distribution, but that the era was now at an end.

Long-awaited reforms for SOEs, for property tax, for breaking local protectionism all require more political transparency, and could spark trouble if not done fairly.

Kroeber then moved the discussion on to innovation, saying that China’s policies had pushed it further away today from the forefront of global innovation than it had been five years ago, in contrast to the US which continues to improve its speed of innovation.

This is one of the factors giving rise to public discontent, shown by Chinese people taking their capital abroad, as well as sending their children overseas to study at an increasingly early age. He concluded by saying that easing up restrictions would lead to more competition and innovation.

More in the Global Times.

Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers’ request form.

In November the China Weekly Hangout discussed the perspectives on what China new leadership might bring, a forum with Janet Carmosky, Greg Anderson and Fons Tuinstra.