SFC Markets and Finance｜Zheng Yongnian: Rural revitalization relies on technological innovation

施诗,杨雨莱,李依农 2024-02-19 23:27

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南方财经全媒体记者施诗深圳报道

Guangdong has held the Provincial High-quality Development Conference on the first working day after the Spring Festival for two consecutive years. What signals have been released for economic development?

On February 18, Zheng Yongnian, Dean of the Qianhai Institute of International Affairs, said in an exclusive interview with the SFC reporter, since the reform and opening up, the market economy has never simply appeared out of thin air, but through the combination of a productive government and an efficient market.

"Last year's Guangdong High-quality Development Conference was very effective, especially the implementation of the 'National Hundred and Thousand and Ten-Thousand Project'. Despite the unfavorable international environment last year, we achieved quite good economic development results," He indicated.

Feb. 18 also commemorates the fifth anniversary of the "Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area". Over the past five years, a series of hardware and software measures have been implemented, helping the overall strength of the Greater Bay Area to increase significantly.

"Compared to five years ago, the GBA has seen a remarkable surge in integration and connectivity, rendering physical barriers to linkage a thing of the past." Looking ahead to the next five years, he believes that the pace of integration of the Guangdong-Hong Kong-Macao Greater Bay Area can continue to accelerate. It is necessary to benchmark the three world-class Bay Areas of New York, San Francisco, and Tokyo in an all-around way, continue to learn from these regions, and make more achievements.

High-quality development is very important

SFC Markets and Finance: For two consecutive years, Guangdong has been the host of the Provincial High-Quality Development Conference. What message does this convey?

Zheng Yongnian: There's a significant historical and international context to consider. In recent years, the world has witnessed a level of upheaval not seen for a century, with stark shifts in the geopolitical landscape and continuous regional conflicts of varying magnitudes. In the pre-globalization era, such regional conflicts would have had a negligible effect on the development of other regions. However, in today's globally interconnected 'village', a conflict in one area can have immediate repercussions elsewhere. The dynamics of geopolitics, Western trade protectionism, economic nationalism, and the trade war conducted by the U.S. have deeply affected China, particularly the Guangdong-Hong Kong-Macao Greater Bay Area. Regarding the international situation, we have limited capacity for change; our response must come from internal adaptation.

Focusing on internal development and specifically on Guangdong, Guangdong manufacturing is influenced by the international environment, which has previously relied on Western and Japanese technology for processing enterprises, thus imperative for Guangdong, and indeed the whole country, to shift towards high-quality development. In the past, the sheer scale of development was the overriding goal; now, the emphasis must be on the quality of development.

With this in view, Guangdong initiated High-Quality Development Conferences last year. This is the second year Guangdong decided to host the event on the first working day after the Spring Festival. I'm sitting in the same seat as the last time in Guangzhou, and this time listening to the speech by Huang Kunming in Shenzhen. Why does the Guangdong High-Quality Development Conference need to be held? It stems from China's unique system where government and market forces are collaborative, not exclusive.

This concept is often misunderstood; many question the need for government-led mobilization conferences. Yet, since the reform and opening-up, the market economy has never simply appeared out of thin air; it has evolved through the synergy of a proactive government and an efficient market. Last year's conference proved highly consequential, particularly in advancing the "National Hundred and Thousand and Ten-Thousand Project." Despite an unfavorable international climate, we managed to secure commendable economic development.

Today, our assessment of development transcends GDP growth rates, prioritizing quality. We call this high-quality development, abandoning the overemphasis of GDP. We now need to look at GDP sometimes, but we also need to see how much quality is contained in GDP, which has become more important. A mindset shift towards quality is essential. Some business leaders hold the misguided belief that mere development suffices, overlooking critical factors. Low-quality development is no longer allowed, such as in the environmental protection field. The dichotomy between economic progress and environmental degradation is stark, and the costs of restoring damaged environments are immense, negating much of the GDP earned. Moreover, low-value industries can be undertaken by other Asian economies like India. Faced with blockades from Western countries and competition from emerging economies, Guangdong must continue to progress, emphasizing quality enhancement more than ever.

New quality productivity plays a key role on rural revitalization

SFC Markets and Finance: Given the complex and nuanced international environment, what opportunities and challenges confront the industrial economy of Guangdong? How can we expedite the development of new quality productivity?

Zheng Yongnian: The discourse on new quality productivity aligns perfectly with the objectives of the Provincial High-Quality Development Conference, encompassing industry, innovation, talent, and finance. The quest for talent is a worldwide competition. Technology doesn't simply appear; it's the fruit of human intellect. With the right talent and technological advancements, we can drive industrial growth. Therefore, the conference's agenda is strategically planned, concentrating on three interrelated pillars: talent, technology, and industry.

SFC Markets and Finance: In what ways should new quality productivity contribute to rural revitalization? How can we tackle the gaps in technological innovation within the framework of rural revitalization?

Zheng Yongnian: The idea that rural economic development should not be taken at face value. It does not mean that villages should be engaging in semiconductor manufacturing or becoming fully industrialized is a misconception. We can see from the experiences of countries like Japan, South Korea, Israel, and even Taiwan in China, that rural areas can cultivate new quality productivity by infusing agricultural products with advanced technology. Take, for instance, a pear from Shandong sold in Singapore, which might command a price ten times lower than its Japanese counterpart; the difference lies in Japan's incorporation of agricultural technology into their production processes.

That is to say, to redefine new quality productivity, we must focus on enhancing technological integration into products and increasing the value added per unit. The antiquated belief was that agriculture was inherently backward. Since the 1980s, many assumed that rural regions would eventually vanish, with urbanization and industrialization rendering them redundant. Yet, this has proven not to be true. Rural areas maintain their importance in the world's most developed nations, with the notable exception of city-states like Singapore, which while lacking agriculture, still possess rural spaces.

You'll see, it's called countryside in English. It's difficult to envision a city like Shenzhen existing without its surrounding countryside. Thus, the revitalization of rural areas is an inevitability. Addressing these challenges requires systemic reforms; the high-quality development of Chinese modernization must encompass not only material and technological growth but also institutional and cultural development in a harmonious manner.

Rural revitalization needs social capital

SFC Markets and Finance: After visiting numerous locations in Guangdong, what is your assessment of the "National Hundred and Thousand and Ten-Thousand Project" throughout the province?

Zheng Yongnian: The "National Hundred and Thousand and Ten-Thousand Project" holds significant importance for Guangdong. As one of China's largest and most prosperous provinces, failing to bridge regional development gaps would be a glaring oversight in Guangdong's modernization efforts. Over the past year, Guangdong has indeed implemented meaningful changes. While this approach has been successful in Zhejiang, the circumstances in Guangdong are different. The "National Hundred and Thousand and Ten-Thousand Project" is poised for rapid advancement in the coming years.

SFC Markets and Finance: How to further advance the development of "National Hundred and Thousand and Ten-Thousand Project"?

Zheng Yongnian: The key lies in mobilizing social capital. How to effectively channel social capital towards rural revitalization is a significant issue for the Guangdong Province and indeed for China. Government investment is essential, but relying solely on it seems unsustainable for long-term development.

China possesses a substantial reservoir of social capital, rural revitalization requires significant investment. The key is to make rural revitalization a new opportunity for the domestic stock of private capital in China. Agriculture's industrialization and commercialization require a foundational capital organization.

To direct social capital effectively to rural areas, systemic reforms are essential to create space for social capital and to safeguard its rights and interests. The rule of law stands as the most formidable safeguard for these rights and interests. Addressing this in Guangdong, with its vast population of over 100 million, will not only benefit the province but also serve as a valuable model for the entire nation.

Common prosperity is the main theme for China’s modernization

SFC Markets and Finance: How will the "National Hundred and Thousand and Ten-Thousand Project" contribute to China's goal of common prosperity?

Zheng Yongnian: The integrated and collaborative development of urban and rural areas are pivotal to achieving common prosperity. In China, an income gap is observed among social groups, particularly disparities between urban and rural communities. In Guangdong, there is a marked contrast between the mountainous regions of the east, west, and north and the affluent Pearl River Delta. Addressing this urban-rural divide is crucial for tackling one of the most pressing issues, which is both a matter of social equity and a step towards common prosperity.

SFC Markets and Finance: You've previously suggested that if China collectively achieves prosperity, it could become the most influential nation globally. Could you elaborate on that?

Zheng Yongnian: Although the United States is currently the world's richest nation, its societal instability is a cause for concern, largely attributable to the vast wealth disparity. Globalization and technological advancements have undoubtedly generated immense wealth in the U.S., yet this wealth is concentrated in the hands of a select few. The question arises: Is this the type of power we aspire to? The answer is no.

At the 20th CPC National Congress, the concept of Chinese modernization was proposed, encompassing fostering the modernization of common prosperity. Our goal is to embrace modernization while steering clear of the imbalances characteristic of the modernization models in the United States and certain European nations. Hence, the modernization China pursues is envisioned to set the global benchmark for modernization.

The GBA is more integrated than before

SFC Markets and Finance: Feb.18 also commemorates the fifth anniversary of the "Outline Development Plan for the Guangdong-Hong Kong-Macao Greater Bay Area." What is your assessment of the progress in the GBA over this period?

Zheng Yongnian: The GBA holds a special place in our hearts. My team and I conducted a thorough research. Our dream was to create a dynamic bay area centered around the Pearl River Delta, which has now come to fruition through strategic policy-making. Compared to five years ago, the GBA has seen a remarkable surge in integration and connectivity, rendering physical barriers to linkage a thing of the past. Moreover, significant strides have been made in harmonizing

software communication and regulatory frameworks. The regulatory environments of strategic zones like Hengqin, Qianhai, and Nansha, along with the Hetao area, have been synchronized with those of Hong Kong and Macao. This marks just the beginning. The Greater Bay Area of today is a far cry from what it used to be. Yet, I believe we can still accelerate the pace of integration.

Opening up is essential for the GBA

SFC Markets and Finance: To further hasten the integration of the GBA, what measures should be prioritized?

Zheng Yongnian: Openness is the lifeblood of the GBA's success. Guangdong's development should always incorporate Hong Kong and Macao which is a national imperative, not merely a provincial duty. Regarding openness, the focus now should be on bolstering Hong Kong's service sector. This industry thrives on clientele, where it once served an international client base. But since international business has diminished, it can now pivot to cater more to the Greater Bay Area. Hong Kong's expertise in finance, healthcare, and education can significantly propel the development of the Greater Bay Area.

I have always championed one-sided openness towards Hong Kong and Macao. Mutual openness, take cars, for example, Hong Kong vehicles are currently allowed to go northward, but if we were to completely open up southward travel, Hong Kong could become overwhelmed. Therefore, it is crucial to take this into account, as the mainland has a larger area and capacity, highlighting the need to expand unilateral openness. From the central government's standpoint, this issue isn't insurmountable. We've already suggested realigning with Hong Kong's regulatory standards.

The report to the 20th CPC National Congress urged to promote high-standard opening-up, calling for a "steady expansion of institutional openness in rules, regulations, management, and standards." Hong Kong's rules, regulations, standards, and management are internationally aligned and sophisticated. To align with Hong Kong is to keep up with the global community. This requires a paradigm shift for our local leaders. I've observed some local officials approaching Hong Kong with an outdated, 1980s mentality, focusing on industrial investment rather than leveraging Hong Kong's advanced rules, regulations, standards, and management. It's imperative for us to acknowledge where Hong Kong excels and for Hong Kong to recognize and capitalize on these strengths.

I've given this careful thought; both sides possess unique advantages. Mr. Liang Zhenying has remarked that the 11 cities within the GBA perform independently and successfully. I would add, however, without integration and collaborative development, none can achieve their full potential.

Cities like Hong Kong, Guangzhou, and Shenzhen are hitting developmental ceilings, and the situation is even more pressing for other cities. If all 11 cities can work together, leveraging their distinct capabilities, they can all thrive. Consequently, the development strategy for the Greater Bay Area must be cohesive and integrated.

The GBA should learn lessons from world-class bay areas

SFC Markets and Finance: In comparison with world-class bay areas such as New York, San Francisco, and Tokyo, how can the GBA seek further enhancements?

Zheng Yongnian: A thorough benchmarking is essential, particularly in harmonizing rules, regulations, and standards. Consider the New York Bay Area, which features a variety of coordinating institutions that span government, industry, academia, and civil society.

SFC Markets and Finance: As you look forward to the next five years, what development opportunities do you foresee for the Greater Bay Area?

Zheng Yongnian: The Greater Bay Area has already notched notable achievements, outpacing many other regions within the country. Despite this success, we cannot afford to become complacent; a sense of urgency is critical. This same sense of urgency is necessary for Guangdong, as well as within the Greater Bay Area, and in Hong Kong. Our benchmarks are the esteemed bay areas of New York Bay Area, San Francisco Bay Area, and Tokyo Bay Area. The Greater Bay Area has a robust foundation, having come a long way from the early days of reform and opening up, establishing a substantial material base. Faced with significant global shifts, the extent of our progress will match the level of our ambition. Consequently, our middle class should possess cultural aspirations, aiming for not only material success but also cultural richness. Without cultural aspirations, the drive for progress diminishes.