No. 26 | 26.12.2021
Hong Kong LegCo election [VCG]
Hong Kong democracy under the framework of “one country, two systems”
Jiang Shigong
Jiang Shigong (强世功) is deputy director of the Social Science Department, professor and vice dean of Law School, Peking University

The election results of the seventh-term Legislative Council (LegCo) of China's Hong Kong Special Administrative Region (SAR) were recently announced. It was the first LegCo election after the improvement of the electoral system in Hong Kong under the principle of "patriots administering Hong Kong" (爱国者治港 àiguó zhě zhì gǎng). Accordingly, all of the 90 elected members are patriors, despite the diverse composition and political views. Jiang Shigong presents an overview of the historical dialogue between the central government and various sectors in Hong Kong on constitutional development. In the half century from the anti-British protest movement in 1967 to the election of the Chief Executive by universal suffrage in 2017, Jiang highlights the fact that the impetus for Hong Kong's political transformation came from the central government. Furthermore, without the central government's promotion of Hong Kong's reunification with the mainland, there would have been no constitutional development and democratic reform in Hong Kong. In this sense, the central government has been the promoter of democracy in Hong Kong. It is paradoxical that some local elites believe that universal suffrage in Hong Kong came as a gift from the British – crediting the UN's International Covenant on Civil and Political Rights, to which the British government is a party – rather than the Hong Kong Basic Law that serves as the legal basis for universal suffrage. In fact, the British government had explicitly declared that the UN's rule did not apply to Hong Kong. After its return to China, the central government has had the legal right to exercise sovereignty over the city. However, the decolonization of Hong Kong is still in progress, and the construction of "one country" in the minds and political identities of its people is not yet complete. Moreover, under the Basic Law, the central government does not exercise control over the fiscal, taxation, and judicial sovereignty nor the day-to-day governance of Hong Kong. According to Jiang, without the principle of "patriots administering Hong Kong," the city would become a semi-independent political entity and radical universal suffrage could lead to a "constitutional crisis" that endangers "one country, two systems." If the SAR is to maintain a high degree of autonomy under "one country, two systems" and at the same time achieve "dual universal suffrage" for the Chief Executive and the LegCo, the only feasible way is to find an appropriate balance between "one country" and "democracy." Therefore, the central government has adopted a gradual, prudent, and rational approach to the issue of Hong Kong's constitutional development, so as to avoid a political emergency in Hong Kong.* The central government is strengthening the patriotic forces, and using this time to encourage a political identity of Hong Kong that can be strengthened with time and in following generations in order to maintain long-term stability and economic prosperity of the region.

*Article 18 of the Hong Kong Basic Law states, "the Region is in a state of emergency, the Central People’s Government may issue an order applying the relevant national laws in the Region."

Why China needs to ease economic policy for stabilizing growth
Yu Yongding
Yu Yongding (余永定) is a former director of the Institute of World Economics and Politics at the Chinese Academy of Social Science, and served on the Monetary Policy Committee of the People’s Bank of China

China has sent a clear signal of loosening monetary policy after its announcement of prioritizing steady growth (稳增长 wěn zēngzhǎng) for 2022. Yu Yongding, who has been calling for the easing of economic policy, explains from an international perspective that the US Federal Reserve will likely tighten its monetary policy by withdrawing from bond purchases and raising interest rates next June. If so, the accompanying capital flight to the US could offset the effects of China's loose monetary policy to achieve stable growth. In this scenario, China may have missed the perfect time to implement loose monetary policies to maintain stable growth. Given the rising debt and inflation, China has been cautious about monetary easing. Yu argues, however, that China's consumer price index (CPI) – a measure of inflation – remains low (increased by 2.3 percent year-on-year in November 2021), compared with a normal inflation rate of 3 to 5 percent in developing countries. Furthermore, due to China’s special conditions – high savings, dominance of state-owned financial institutions, high capacity to cope with crises – its debt tolerance should be significantly higher than Western countries. Citing Deng Xiaoping's phrase “development is the absolute principle" (发展是硬道理 fāzhǎn shì yìng dàolǐ), Yu highlights that insufficient effective demand and low economic growth currently are among the major concerns for China's economy. The country's macro leverage ratio – the percentage of overall debts to GDPcould be cut only if its economic growth remains strong. China's central bank has taken actions, such as reducing required reserve ratio and cutting benchmark loan rate to inject liquidity into market, which will reduce the financial pressure on enterprises. Yu stresses that monetary policy cannot do much to halt the decline of China's economy while emphasizing that fiscal policy could play a more central role in stimulating economy. In addition, he suggests that fiscal expenditure focusing on infrastructure investment could be a better way to achieve the goal of stable growth in China.

Digitalization is reshaping China’s counties and villages
Lü Peng
Lü Peng(吕鹏) is executive dean of Institute of Digital China, University of Chinese Academy of Social Sciences

Counties and villages are the main battlefield of China's rural revitalization and common prosperity. After conducting field research in more than a dozen counties and dozens of townships and villages in western China over the past year, Lü Peng and his team summarized nine aspects of changes in rural development that have been brought by digitalization. The report shows that as grassroots governments bid for projects, many big tech companies have moved to counties and created new jobs, such as online customer services and artificial intelligence trainers, attracting young people who work in big cities to return to their hometowns. The e-commerce live-streaming jobs are also booming in villages. In Xuebu village, a key producer of crystals located in Jiangsu Province, nearly 600 villagers have become live-streamers. Meanwhile, many new digital jobs are open for women, which have enhanced their family status and self-confidence. Another factor in attracting young people to return is the development of digital technologies in counties and villages. For example, grain producers can apply for loans within a few minutes on their mobile phones through "satellite loan" (卫星贷款 wèixīng dàikuǎn )programs provided by online banking platforms. In Medog in Tibet, China's last county to be connected to highways, electronic display screens are used in middle school classrooms. According to Alipay, the largest digital payment platform in China, the mobile payment penetration rate in Tibet ranks first out of all the regions for five consecutive years. In addition, the rise of county brands reflects the purchasing power in counties. In the first quarter of 2021, per capita consumption expenditure of rural residents grew by 21.1 percent, higher than the 15.7 percent of urban residents. As a result of digitalization and globalization, more and more "champion counties" have emerged. For example, Cao County, which used to be a poor county in Shandong Province, produced 90 percent of coffins for Japan, 70 percent of performance costumes for online sales, and 30 percent of the country's hanfu – traditional Chinese clothing – and became a national phenomenon this year.

A Chinese PhD graduate’s insights into industrialization in Africa
Cao Fengze
Cao Fengze (曹丰泽) has a PhD degree in civil engineering from Tsinghua University (2021) and joined China Sinohydro Group after graduation to work on a Tanzanian hydropower plant.

Cao Fengze's experience in building hydropower plants in Africa gives a refreshing perspective on young Chinese people's understanding of industrialization. After graduating from Tsinghua University, one of China's top universities, Cao went to Africa with a passion to contribute his "life's work" to bring clean and abundant electricity to the people of Tanzania. He and his companions are currently building a hydroelectric power plant in Tanzania, which will be the largest in sub-Saharan Africa when completed. He writes, "Tanzania is a very respectable country, but like other less developed countries in Asia, Africa, and Latin America, it has long been suppressed by an unjust international order, making it difficult to gather financial resources for industrialization. In order to build this hydroelectric power plant, the Tanzanian government devoted all its efforts to make the country's industry take the most difficult step from zero to one." However, after over half a year of experience, industrialization has taken on a new meaning in Cao's eyes. According to Cao, industrialization can be an "awkward"(尴尬 gān gà)process. In order to produce electricity, you first need to have access to electricity. However, Tanzania lacks electricity, and the hydropower plant site requires a large supply of electricity from the construction site, material processing, and transportation. The author lives in a camp where power outages are not uncommon; the pumps that supply domestic water also require electricity, and sometimes both the water and electricity disappear halfway through dishwashing or bathing. However, these were the best conditions Tanzania could provide for the Chinese builders. In recalling his experience, Cao describes how industrialization can also be a "humiliating" (屈辱qū rǔ) process. When the water suddenly stopped while in the shower covered with foam, the author realized that some countries overdraw their national strength to the limit and suffered from difficulties, while others can harvest the fruits of the world's trillions of labor with the touch of a finger, so that hundreds of millions of people can lie in a 24-hour 17℃ air-conditioned room without working. Industrialization is also a ridiculous(荒唐huāng táng)process. What is needed to change this absurd order are people made of steel. "I hope these people will include me" Cao says.

Assessing the history and legacy of “Mao Zedong fever”
Zhang Xudong
Zhang Xudong(张旭东)is a professor in the Department of Communist Party China History, Central Party School (Chinese Academy of Governance)
Zhang Wenjing
Zhang Wenjing(张文靖) is a PhD candidate of the Party School of the Central Committee of the Communist Party of China

December 26, 2021 is the 128th anniversary of the birth of Mao Zedong. For a long time, the admiration of the leader – or "Mao Zedong fever" (毛泽东热 máozédōng rè) – has been on the rise, whether officially or individually, and domestically or internationally. Today in China, more and more young people are reading the Selected Works of Mao Zedong. Zhang Xudong and Zhang Wenjing summarize four historical milestones in the "Mao fever": the first was the publication of Edward Snow's Red Star Over China in October 1937. Snow was the first foreign journalist to interview Mao, introducing him and the Chinese revolutionary process to the world. This book was translated into over 20 languages when it was released, and the 100,000 Chinese copies were distributed in a mere few weeks. The second moment was in the 1950s, when under Mao's leadership, China completed its socialist transformation and most of the regions were able to address the question of hunger and clothing for their people. For this, there was an outpouring of love and support for Mao among the people, expressed in the common chant, "Long live Chairman Mao." The third moment was marked by the Cultural Revolution in 1966, and the fourth began in the 1990s and continues today. Internationally, Mao fever also grew in the 1960s and 1970s owing to the Chinese leader's charisma, his great contribution to the Chinese Revolution and the liberation of oppressed nations and peoples around the world, and his great influence on the public. The admiration of Mao also reflects the social conditions. During the period of reform and opening up, China's socialist market economy brought with it a set of social problems, and some groups, experiencing dissatisfaction from being disadvantaged in the market competition, began to miss the Mao-era. Furthermore, rent-seeking and rent-setting opportunities emerged with the market economy, with a few leading cadres taking advantage of the situation to enrich themselves and engage in corruption. This reality also encouraged a turn towards the experiences of anti-corruption during the Mao-era. The authors believe that Mao fever is always produced along with social actions in China and that it is a healthy, progressive, and hopeful phenomenon. At the same time, the assessment of Mao must be done in a scientific and historical materialist approach. The authors believe that Mao and the Mao-era not only changed the modern history of China, but will continue to influence the history of the future – Mao fever, therefore, will continue.

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