Saturday, February 20, 2010

The Dragon's problems

Many believe that democracy and freedom play no role in the building of nations, some even point to the Chinese model of developments as an example. China is communist elite have been holding to power, while at the same time its economy is leaping by giant strides.

However, I believe that many analysts are mistaken in their assessment of China's growth. The whole country's economy is based on manufacturing products designed in the United States and Europe due to its low labor costs. China is artificially making it products cheaper by devaluation of its currency. Without freedom, there is little room for innovation and the creation of the knowledge based economy. Free minds are active creating solutions and are more dynamic in facing problem.

Many assume that the situation in China is static, but one has to look closely around to see that China is becoming more open to the world and gradually allowing political freedom. There are set back and government backlash against the oppositions. There are also ethnic problems between the Chinese Hans and the Igur Muslim minority, but the government now is acting in more restrained fashion in comparison on how they dealt with the student protests in Tiananmen Square.

Government officials are worried about political stability so that China could lure investors. Nevertheless, what happens in China does not stay in China, due to the development of digital media technology, a video can be shot discreetly from one's mobile camera sent around the world using the Internet and via multi-media messages. Although, the government has tried its best to sensor search engines and ban websites, many are able to overcome these filters. For example a Chinese student invented software called Free-gate to bypass the governments ban on Wikipedia.
Accountability is one of the cornerstones of democracy, ideally government officials are held accountable in front of the people that are elect them. For a country to develop, government officials need to be proactive agents of the people, taking their best interest at heart, balancing the opportunity costs of development with the environmental impact. However, the Chinese officials care only about economic growth, thus making China one of the world largest polluters. This is going to have a massive impact on human health and will also replete the natural resources for the next generations of Chinese.

Today in an increasingly competitive economies, the situations change very fast decision makers at the local level need to act fast in an ever more complex world. In this complex world, to remain competitive governments have to become more agile and less decentralized regional and local government officials will have to play more key roles in the country future. Yet,it is important for Beijing to watch its path and choose for itself

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