x Abu Dhabi, UAEMonday 22 January 2018

Book review: Chinese growth not as impressive as it seems

Don't believe everything you read about China says author Ben Chu in his book Chinese Whispers: Why everything you've heard about China is often wrong.

Chinese Whispers: Why everything you've heard about China is wrong. By Ben Chu
Chinese Whispers: Why everything you've heard about China is wrong. By Ben Chu

An epidemic of Sinophilia has struck popular commentators in the West as China’s gargantuan growth rates raise eyebrows across the developed world.

But as Ben Chu argues in Chinese Whispers: Why everything you’ve heard about China is wrong, enthusiasm for the Chinese growth model is frequently accompanied by ignorance about its nature and consequences. Too many writers, historical and contemporary, have considered China to be an unknowable foreign hinterland, where individual character and social affairs are unlike anything on their own shores.

Mr Chu debunks a number of myths.

Despite the hand-wringing that accompanies annual publication of Pisa scores, which show American and European teenagers falling further behind rival Asian cohorts, China has not happened upon a uniquely efficient solution to the task of educating children. Instead, it drills them with gigantic quantities of rote learning and ignores the critical-thinking skills new workers need.

Nor is China a socially homogeneous country, Mr Chu argues. Linguistic diversity is growing rapidly, and regional and ethnic differences are significant.

China has not reinvented capitalism – its rapid growth follows the quick rates of catch-up many significantly underdeveloped countries have achieved, and it relies on the expropriation of poor rural masses whose meagre savings fund an investment boom that benefits plutocrats the most. Its record in innovation is weak, it remains at a low rung on the value chain and the competitive advantage it gains from low wage rates is steadily slipping as growth brings modest income increases.

The environmental cost of this is difficult to comprehend, Mr Chu states. Poisons and carcinogens cause disease in hundreds of thousands of urban dwellers annually.

But worst of all, there is reason to think that the country is overdue for a major financial crisis. Between a massive, unregulated shadow banking sector, corrupt and profligate local governments, financially opaque state-owned industries and signs of a large property bubble, the Chinese boom looks rather precarious.

In the face of exaggerated claims of China’s future pre-eminence, Ben Chu’s book is an invitation to healthy scepticism.