Policy of Foreign Economic Openness in the People’s Republic of China: Main Results and Prospects

Abstract

The People’s Republic of China marks in December 2018 the 40th anniversary of the economic reform start. Its integral part was external economic openness of the country which replaced former Mao Zedong’s policy of autarky. The article deals with the main achievements of China’s foreign trade in goods and services and cross-border investment cooperation of the country during reform period. Shortcomings and problems in these spheres are shown. The article analyzes the formation of the second stage of foreign economic openness in China, which is associated primarily with the initiative to build land and sea “silk roads” and with the creation of a number of experimental free trade zones in the country. The possible prospects of further development of China’s foreign economic relations, taking into account various internal and external factors, are analyzed. Briefly summing up the results of China’s foreign economic openness policy in the years of reform, we can say that it has played a crucial and irreplaceable role in the modernization of the country and its transformation into one of the leading powers in the world, in absorbing norms and rules of the world market. China has become one of the world leaders in terms of trade, attracting foreign investment and investing abroad. Beijing has adapted itself well to the process of globalization of the world economy and has become one of its main beneficiaries. China’s official position is currently distinguished by its commitment to globalization, resistance to protectionism, and support of active economic cooperation in all areas. This position is quite natural, since foreign economic relations will remain one of the leading factors in China’s development for the foreseeable future. On the way to achieving the goal proclaimed by Beijing – to turn the country from a “big” trading power into a “powerful” – China has much to do in order to overcome the weaknesses revealed in its foreign trade and foreign economic relations in general, and also to take more fully into account the often fair claims and demands of its trade and economic partners. Beijing is working hard on a strategy for further development of foreign economic relations. Particular importance is attached to the formation of a wider network of trading partners along the routes of land and sea “silk roads”. It is necessary to significantly increase the share of China’s Western territories in country‘s foreign trade and investment activities abroad. Beijing is planning to form a group of multinational companies with Chinese capital, which have high international competitiveness. The development of products with high value added, the struggle for the high prestige of goods of famous Chinese brands, the search for new ways of trade in services and goods, the formation of new interstate free trade zones will be continued. In practical terms, one of the most important steps is the formation of pilot free trade zones in China itself. They are designed to work out the transfer of China’s foreign trade and investment activities to advanced international standards, to prepare further opening of the Chinese market (including financial, social, educational services) for foreign investors.