China's transformation, Part 1. Why learn from China?

Evaluators have an imperative to learn from success. Today we are fortunate: Those of us working in development or evaluation can learn from one of the greatest transformational development success stories of all time. For the first time in history a country, China, has lifted out of poverty a very large percentage of its population - 850 million people in total - at a sustained pace never seen before in recorded history.

The Chinese middle class is now 200-300 million strong, a vast spending power with an average net worth of $139,000 per person. Yet in 1978, a mere 40 years ago, China's GDP was lower than that of Chad, Malawi or Bangladesh, and one tenth that if the US. More than 90 percent of the population lived under the extreme poverty line set by the World Bank. From 1980 until 2017 China averaged 9.5 percent growth, on average doubling its GDP every 8 years. In 2008 its GDP was 50 percent smaller than that of Japan; by 2016, it was 2.3 times larger. In purchasing power parity (PPP) terms it is now the world's largest economy.

China had achieved all the Millennium Development Goals by 2015; without its contribution, global progress would have been rather unimpressive. According to the World Bank, between 1990 and 2016 two-thirds of the 1.1 billion people pulled across the extreme poverty line were in China. It is now on focused on and on track to eliminate absolute poverty by 2020.

I have been following China's development for many years in its efforts to create a "moderately prosperous society" by 2020. I visited a number of cities in China for the first time in 1992, when I was the first person with a South African passport ever officially recorded to have entered Tibet. I have been back to China several times, most recently in 2017. Progress in the cities has been astounding; visitors to China can see transformational change everywhere, as is clearly illustrated by the pictures of Shenzhen below (population in 1980 - 58,000; in 2015 - 10.7 million). Chinese I know are quick to say much still needs to be done in the rural areas. But just think about how many transformations in different spheres of life occurred to enable such change within one generation.

Indications of transformational development

Countries find it hard to escape from poverty traps; this needs multi-pronged interventions that relieve multiple joint constraints, or a very selective 'big push'. China has succeeded in escaping the poverty trap. More to the point, it has undergone transformational development at national scale. In the past 30 years, 500 million people have moved to China's cities. Shenzhen is one of 102 cities in China that today have a population of more than 10 million. Imagine the transformations that had to be initiated or encouraged or stimulated in the economic, social, technological, physical and environmental (yes, this was negative) spheres to enable such drastic change and sustained development trajectory in a country of more than 1 billion people.

China's HDI value increased by nearly 50 percent to put it at 86 out of 189 countries and territories - in other words, in the "high human development" category;

life expectancy at birth increased by 7.1 years;

mean years of schooling increased by 3.0 years;

the Gross National Index (GNI) per capita increased by 899 percent.

China has 29,000 kilometers, around two-thirds of the world's high-speed rail tracks in commercial service; in 2018 alone, it carried nearly two billion passengers. The Shanghai Maglev is the world's first high-speed commercial magnetic levitation line; it reaches a top speed of 430km/h (267mph).

The total length of China's expressway network reached 142,500 kilometres in 2018 - the world's largest, having surpassed that of the US in 2011.

Chinese companies set records such as building a 57-story skyscraper in 19 days and a railway station in just 9 hours.

It is building what will be the largest transmission line in the world, capable of delivering enough power for 26.5 million people across thousands of miles.

In 2018, more than 150 million Chinese travelled abroad.

China now graduates 1.8 million scientists, engineers, and mathematicians annually; by 2025 it is expected have more technologically skilled workers than all members of the OECD combined.

It is in first position in producing scientific articles - 18.6 percent of the total documented in Elsevier's Scopus database - and is moving up fast in the number of citations.

It is the global leader in e-commerce and mobile payments; in 2018, mobile payments amounted to $24 trillion - 160 times that of the US.

It has at present 94 (29 percent) of the world's unicorns (start-up companies valued at more than US$1 billion).

China is about to outperform the US in artificial intelligence and cloud computing - and some say it is already doing so. It is #1 in total AI research papers and highly cited AI papers worldwide, in AI patents and in AI venture capital investment. It is #2 in the number of AI companies and the AI talent pool.

Initiated and led by China, the Belt and Road Initiative (BRI), is the largest infrastructure project in history. It is already engaging around 70 countries across four continents, and is expected to encompass more than a quarter of all traded goods and more than 60% of the world's total population. It is no surprise that among powerful countries opposition to this initiative is fierce, and any setback is given a high profile in allied media.

Yet China remains part of the Global South

China has escaped the poverty trap, but it still faces a potential middle-income trap, where a country gets stuck at a certain level of income achieved through rapid development. Avoiding this requires identifying strategies to introduce new processes that can provide the country with a competitive advantage, find new markets to maintain and encourage domestic demand. The government has been busy changing its development plans accordingly. Given all its achievements to date, it is not surprising that the Made in China 2025 plan launched in 2015 is considered a major threat by major powers.

Despite its achievements, China is still very much a country in and of the Global South. In 2017, its per capita GDP in nominal dollars was $8,583 - only 14.4% of that of the US, and less than one quarter of the average of OECD countries. An estimated 373.1 million people live below the upper middle-income international poverty line of $5.50 a day. In 2018, 30 million of the world's poor were living in China, and 54 million Chinese can be classified as "population vulnerable to poverty", living on US$3.10 a day or less.

Rebalancing growth

Not surprisingly, the largely Western propaganda machine against China has gone into overdrive in recent years. One of the common narratives is that China's slowing growth is due to external pressures or a sign of weakness. Yet already in 2012 I read that there had been a decision to slow its growth to around 6.5 percent (yes, that was indeed the number), otherwise it would have "consumed three planets" in the foreseeable future. The economic slowdown and efforts to stimulate domestic demand were planned a long time ago - even if influenced more recently by external factors.

So, in the 13^th Five-Year Plan (2016-2020) the annual growth target was set at 6.5 percent. This reflects the rebalancing of the economy and the shift to a focus on the quality rather than quantity of growth, and a much stronger focus on the environment through the notion of an Ecological Civilization, which I will write about in an upcoming post.

Why is this relevant for evaluators?

As I have pointed out in many of my blog posts and presentations, it is imperative that development and evaluation specialists engage more intensively with complexity theory and systems thinking and their application in practice.

China's transformational development achievements provide many lessons in many spheres. Some of the most important relate to a CAS perspective on life and development. I will focus mainly on this aspect - but also on others - in the rest of this series.

We all need to look much more seriously at China with the respect that it deserves for what it has achieved, and learn from both its positive and negative experiences - in particular, how to apply and adapt what can be learnt in the contexts in which we work. This will serve the world well during an era in which it urgently needs new mindsets, new frameworks, new models, new examples and new practices.