Changing growth paradigms
Updated: 2013-09-04 15:12
By Dennis Pamlin (China Daily)
As China's growth, as measured in traditional ways, has slowed down, many traditional experts, especially in the West, have seen this as a problem for the world. But a slowdown of traditional GDP should not be viewed with 19th century theories, instead it should be seen from a 21st century perspective.
While scientists and experts all around the world are in agreement that the world needs to move beyond the simple ways that are used to measure GDP, and that GDP can no longer be used to measure the progress of a country in any meaningful way, almost no senior politicians outside China have publicly declared that they support this scientific knowledge.
It is obvious that China is looking for new tools to guide its development. President Xi Jinping recent statement in a meeting that officials should not to be obsessed with economic growth also needs to be factored in to understand the situation.
The most important aspect, however, is not the shift away from GDP, but the new focus on other aspects including people's livelihood, the development of local society and the quality of environment.
The focus on what people want and need, development of local societies and care for a planet with limited resources, is what is needed if we are to ensure a global sustainable development. If such a shift happens, GDP swings will be of little consequence. GDP is no longer a valuable tool and we should focus more on the actual development in countries around the world.
In the short term it is obvious that some old industries and uneducated policymakers in the West will be upset if China stops using GDP as a measurement of progress. China's new direction will result in a situation where the country's role as a dumping ground for, often old, Western products and services is coming to an end.
But this shift will have very positive impacts both directly and indirectly. The direct impact will be when tomorrow's solutions start seeing a growing market in China. China will both increase the import and export of tomorrow's sustainable solutions ranging from smart mobility solutions, electric cars, renewable energy, e-books, smart software, new architectural solutions and smart city planning.
The indirect impact will come from the new models for business and policymaking that will be developed to support and measure this shift. It will also encourage a cultural exchange where values beyond greed and short-term economic self-interest are in focus.
China's emphasis on low-carbon cities has already had a positive global impact that supports a new generation of entrepreneurs. In a world where over-consumption is often a bigger problem than under-consumption, a single-minded focus on growth obviously makes little sense.
For many, and especially in cities, the focus today is on better, not more. We need smarter mobility, not more, resulting in pollution and congestion. We need more quality healthy food, not more, resulting in obesity. We need to read, not just more old paper books, resulting in dead forests. We need to meet, not always more physically travel, resulting in increasing carbon emissions.
The Chinese dream has rapidly become a concept that gathers and inspires groups to think beyond marginal changes. In a world where it is clear that incremental improvements in current systems is not enough, but where transformative changes are needed, it's necessary to look beyond the obvious and the Chinese dream and beyond GDP should become a global reality.
Obviously China has many traditional economic challenges also, related to everything from old industrial structures and a financial system that is not working very well. Still these challenges are very small compared with the challenges the world has and that is related to the obsession with GDP in many governments and companies around the world. Through global collaborations and with the help of new platforms, especially clusters that support transformative solutions, China's focus can help a global shift toward sustainability. Instead of interpreting the current situation as a slowdown in GDP that should be turned into high growth again, we should focus on how we can further support the acceleration of sustainable solutions that China has already begun to implement.
What looks as a slowdown from an old perspective is actually a rapid growth when it comes to what we need.
The author is founder of 21st Century Frontiers, a Sweden-based consultancy.