With the end of 2018 marking the 40th anniversary of China opening up & reforming (and with an increasingly loud group of market participants questioning the foundations of China’s economic miracle – and more importantly, it’s future), Bridgewater founder Ray Dalio believes now is a good time to reflect on China’s last 40 years.
“Since I have been fortunate to have experienced 34 years of this 40 years in an up close and intimate way, and since I study what makes countries succeed and fail, I have some experiences and thoughts to share…”
The table below shows just a few representative statistics.
These results speak for themselves, but Dalio adds:
“To have such rates of improvements in so many areas and for so many people has made it the greatest economic miracle ever.”
And from what Dalio has seen, he believes that the very impressive results that the Chinese leadership and the Chinese people produced came about primarily because of the powerful combination of
a) China’s opening up and reforming following an extended period of isolation that led to a fast catching up (especially in the coastal regions of China) with the advanced developed world, and
b) the power of the Chinese culture and it’ related ways of operating.
Crucially, the billionaire hedge fund manager points out that, if you haven’t spent time in China, you need to get any stereotypes you might have out of your mind because it’s not how it was. This is not your father’s communism. It is “socialism with Chinese characteristics” that has been significantly and very effectively reformed, which has made it much more vital, creative, and economically free.
Dalio’s ‘romantic’ view of a paternal China is definitely not the mainstream narrative:
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