China's accession to the WTO is just around the corner, and there is naturally an upsurge of "accession to the WTO" in China. All walks of life have also begun to study the impact of China's entry into WTO on this industry. In terms of popular terms, we must face the "opportunities" and "challenges" brought by WTO to our economy.
What is the greatest opportunity for China to join the WTO? What is the biggest challenge? On this issue, we should not only see the specific problems of all walks of life, but also study the impact of China's entry into WTO on China's economy in a deeper and more comprehensive way. It should be said that the biggest opportunity for China to join the WTO is to make full use of economic globalization to accelerate its own economic development, while the biggest challenge is how to face the WTO and speed up the economic system reform.
There are two major backgrounds to consider why China joined the WTO. One is the background of globalization, and the other is the background of China's reform. Since the 1990s, the trend of world globalization has become more and more obvious and is accelerating. What is globalization? Simply put, globalization means that people engage in production and consumption on a global scale. Globalization is actually a process that economic development makes countries increasingly interdependent, and it is also a process of establishing a borderless economy. One of its manifestations is the globalization of production. In other words, producers can use global resources to engage in production, not limited to domestic resources. We used to emphasize self-reliance and self-sufficiency, thinking that we could use our own things if we really didn't have them, and we used others' through imports. Today's producers don't have to think too much about the limitations of their own resources, as long as the resources are cheap. Making full use of global resources can not only make up for the shortage of domestic resources, but also greatly reduce production costs.
China's accession to the WTO not only means that China can export goods to other WTO members more freely, but also means that China will be more fully and thoroughly open. We usually only call it an opportunity to expand exports, but seldom think that our further opening up is also an opportunity to accelerate economic development. For the whole economy, opening the market to allow foreign goods and capital to enter China is not only the so-called "cost of joining the WTO", but the opening of the market itself will bring many favorable factors to China's economic development.
First of all, opening the market and expanding imports will help China make full use of global resources. Although China has a vast territory and abundant resources, its natural resources are relatively scarce due to its large population. In a closed economy, we have to provide food for ourselves by constantly increasing the output per unit land area, use our own oil by paying high prices, and try to protect our own forest resources by curbing consumption. In fact, the scarcity of natural resources in China does not mean the shortage of global resources. In contrast, the United States, Canada, Australia and other countries are rich in land resources and forest resources, and the Middle East is also rich in oil resources. We import grain, oil, wood and pulp, but actually we import land, minerals and forests, which is very beneficial to improve the resource allocation in China.
Theoretically, if China does not join the WTO, it can import these resource products, but it is not easy to do so in practice. Without the guarantee of system and law, it is not easy for any country to open up industries that lack comparative advantages. Local and industry interests are often placed above the overall interests. Joining WTO, promising to open the market and cancel protection may seem unfavorable to the domestic resource product production industry, but in the long run, it is beneficial to the rational utilization of scarce resources and long-term sustainable development in China.
Secondly, opening the market and integrating into the global economy will force enterprises to face the competition in the global market, which will help China enterprises improve their efficiency. People usually regard facing competition as a kind of "challenge", which is right from the perspective of enterprises, but from the perspective of a country's economy as a whole, we can regard strengthening competition among enterprises as an "opportunity" to improve efficiency and accelerate development. It is not easy for China to strengthen its own competition, especially at present, many industries are monopolized by state-owned enterprises. The existence of various interest groups and the theory of protecting national industries make these industries protected for a long time and inefficient. It is not so easy to break the monopoly of state-owned enterprises in these industries only by domestic reform, but by opening the market and allowing foreign goods, services and capital to enter China's market, a competitive economic system has been established at once. Therefore, although the market opening has brought an impact to China enterprises, it is also an opportunity that cannot be missed for the long-term economic development of China.
China's reform has been going on for more than 20 years, and now it has entered a critical stage. Where will China's economic system go? In this regard, there is still a great debate in theory. China's entry into WTO gives China an opportunity to determine the next reform goal. We can no longer indulge in theoretical arguments, but must face the reality of globalization and reform our economic system. Whether the system reform can be completed quickly and successfully is the biggest challenge to the government.
There are two reasons why China must speed up its economic restructuring. On the one hand, it is the pressure from global competition, on the other hand, it is the driving force to help China enterprises participate in the competition. In other words, as long as we participate in the process of economic globalization, we must reform the existing system. In order to make our enterprises invincible in the global competition, we should also actively reform the existing system.
One of the results of economic globalization is the convergence of systems. It turns out that the economic systems of all countries are relatively complex, including planned economy and market economy. There is much state intervention in market economy, and there is basically no state intervention. Since 1990s, many countries have reformed their original economic systems. The direction of reform is not to strengthen planning, but to strengthen market-oriented economic regulation. Not only the original planned economy countries have undergone structural transformation, but also some countries that were originally market economies but were not very open, including Japan, India, South Korea and many countries in South America, have also undergone substantial reforms. The general trend of reform is to make the closed economy with more government intervention develop into an open and free economy. Not all the reforms in these countries are voluntary, such as South Korea and Japan. However, if a country wants to participate in the process of economic globalization, it must be more free and open. There is a simple reason. When we compete and cooperate together, we must abide by the same rules of the game, and all enterprises must operate under the same rules. One of the principles of the WTO is "fair competition", that is, competition under the same conditions. Enterprises in a competitive market cannot have government subsidies unless everyone has subsidies. Because it is impossible for everyone to enjoy government subsidies, the result must be that no one can subsidize. Similarly, there can be no government investment in the field of competition, and investment between state-owned enterprises and private enterprises with government investment will be regarded as unfair competition. If state-owned enterprises can't compete with foreign enterprises and private enterprises, foreign enterprises may not care what kind of subsidies they get, but once state-owned enterprises are more efficient than private enterprises, foreign enterprises will find fault with their systems and policies. China enterprises may be at a disadvantage in the current competition, but we should be prepared to occupy an important position in the future international competition. To do this, we must work hard on the reform of system and enterprise property right from now on.
From the perspective of actively helping China enterprises to participate in international competition, we must also accelerate the reform of the economic system. The current system not only restricts the growth of small and medium-sized enterprises, but also hinders the development of large enterprises. In large enterprises in China, although there are many assets, the problem of enterprise property rights has not really been solved. The operation of an enterprise mainly depends on the supervision and management of higher authorities, the personal quality of enterprise leaders and the inclination of government policies. Enterprises still lack effective incentive mechanism, innovation mechanism and supervision mechanism.
Under the effective protection of policies, these enterprises may still be able to maintain their operations, but how to remain invincible in the direct competition (including the competition in the talent market) after the entry of foreign capital is not optimistic. The development of non-state-owned enterprises is also restricted by the system. Why are there no enterprises from China in the world's top 500 companies? Why is there no enterprise like Microsoft in China? Not because there are no entrepreneurs in China, nor because China is a developing country. Our current legal system, financial institutions and industrial policies have not created a promising environment for entrepreneurs. Facing the international competition after China's entry into WTO, how to speed up the reform of China's economic system and create conditions for the development of enterprises is indeed the primary task and severe challenge for governments at all levels.
China is getting closer and closer to the WTO, and the long-awaited door of 13 is about to open for China. With regard to China's entry into the WTO, we should consider the interests of the whole people, the future development of China and its position in the world economy. After 20 years of reform and opening up, China is no longer a poor, backward and conservative China, and we have the ability to participate in world competition. We should not always think of ourselves as a developing country, but work for a developed country with confidence. The main factor that hinders our progress is not our ability and resources, but our ideas and systems. The greatest significance of China's accession to the WTO is not the gains and losses of certain industries, but the establishment of a modern economic system, which will help to bring our potential into play and make China more prosperous and powerful. If we proceed from this point, the impact of China's entry into WTO on China's economic development is far-reaching.