The COVID-19 pandemic is forcing the countries to re-evaluate and recalibrate their policies national and foreign.
The need for structural transformation of economies, which has been elusive in many developing countries, has never been greater.
La structural transformation is the movement of labor and other productive resources from low-productivity economic activities to high-productivity economic activities.
China is one of the few developing countries that has achieved this feat., growing from a global manufacturing assembly center to an economic powerhouse, thanks to the enormous scale of its market.
“There are important lessons from China’s experience that other countries can draw on,” said UNCTAD’s chief economist Rashmi Banga. “Emulating advanced economies has benefits, but most developing countries are better placed to do so.” learning from bottom-up growth experiences«.
While China's Belt and Road Initiative (BRI), a multi-billion dollar investment and infrastructure venture, provides infrastructure links, the UNCTAD is helping nations build links sharing their political experiences.
UNCTAD is implementing a project to help countries in the global South better understand China's development experience and, where appropriate, adapt relevant policies for their own success.
La UNCTAD BRI platform has published six papers describing the policy experiences that facilitated the structural transformation of the Chinese economy.
The papers cover China's experience in the areas of macroeconomic management and finance; digital economy; trade, industry and investment; debt sustainability and debt management.
So how did China do it?
Concrete actions that drove the digital revolution
UNCTAD has published two documents on the digital policy and the policies of E-commerce from China.
According to the documents, China designed specific policies and strategies for its structural transformation. It built its digital economy from scratch with a comprehensive policy which targeted both supply and demand.
His big push included the infrastructure of networks, broadband and cloud computing and data centers. This was accompanied by a strategy to build a industrial internet ecosystem that was compatible with national economic and social development.
China had 11 actionss specific under its policy that were aimed at the Deep integration of the Internet with the real economy along with the development of consumers' digital skills.
He understood the importance of data. Established a cyber security law which stipulated that personal information and important data collected and generated will be stored within the territory of China, and when such data is transferred across borders for business needs, security assessments will be conducted.
El Cross-border e-commerce is closely regulated by the government, which has successfully implemented a series of associated fiscal policies.
Prospective policies and reforms
Along with the comprehensive digital policy, the framework of the China's macroeconomic policy has played a key role in the structural transformation of the country.
China has achieved this through a combination of proactive macroeconomic management, financial reforms and carefully managed capital account liberalization.
The financial reforms that China has undertaken and the financial sector that has emerged from these reforms have played a special role in catalyzing capital accumulation and economic diversification.
In the past 40 years of reform and opening up, Foreign trade and foreign investment have been important driving forces for China's economic development.
China’s strategic approach to participation in global and regional value chains has been particularly successful.
La investment policy It has also played a key role in attracting and regulating foreign investment and guiding it so that it contributes positively to national development.
China's strategic approach to the debt management and debt sustainability During the process of structural transformation over the past 40 years, it has also helped it achieve sustainable growth.
The selection of well-targeted projects aimed at market expansion and foreign exchange earnings, and the assignment of responsibility for raising debt and investment decision-making to local government authorities contributed to debt sustainability.
This measure also encouraged innovation and flexibility as central authorities maintained control over aggregate debt risks and economic stability.
“As countries around the world grapple with the economic fallout from the impact of COVID-19, their success will depend on implementing bold policy actions to structurally transform their economies,” said Richard Kozul-Wright, UNCTAD’s director of globalization and development strategies.
Source: UNCTAD
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