China celebrated the 100th anniversary of the Founding of the Communist Party with an impressive military deployment, a subtle way to showcase its brand-new superpower status. The celebrations had President Xi Jinping as a maximum reference, above historical leaders such as Mao or Deng Xiaoping. In his speech, Xi stressed that "the Chinese Communist Party and the Chinese people, through a heroic and tenacious struggle, have shown the world that the realization of the great revitalization of the Chinese nation has become an irreversible historical process."

LPO interviewed Osvaldo Rosales, economist, former director of the Division of International Trade and Integration of ECLAC and author of the book "The Chinese Dream", which analyzes the future of Chinese power, the dispute with the United States for world leadership, and the challenges expected in facing another centenary: the 100 years of the People's Republic in 2049.

How will the Communist Party be seen at its 100 years celebration?

The first thing to be mentioned is that the centenary of the Chinese Communist Party places China in an economic power status, competing alongside the United States amid twenty-first century technologies and scoring a series of wins. According to the purchasing power parity measurement, Chinese GDP is the largest in the world. China is the world's largest exporter of goods, the main creditor of the United States, measured by its level of capitalization of the five major banks in the world, of which four are Chinese.

Secondly, I believe that we must highlight its impressive achievements in technologies and infrastructure, especially in terms of high-speed trains, and the fact that it has maintained a long process of growth, with rates that are unparalleled in history: forty years of growth at 8.8 or 9 percent per year. All of this should make them proud, but there are also new situations derived from this rebirth that causes tension with the West and increases the conflict further, firstly, from the commercial standpoint, then from the technological view, and also, for global hegemony with the United States, that started with Trump, and continues under Biden.

So, there were a number of events, such as the last G7 summit, that shows European countries looking to China as a systemic competitor or directly as a rival. Therefore, I would say that the centenary of the Chinese CP places China in a dual situation, excited for its achievements, but at the same time, as a threat to the West, which seems to be articulating against the aspirations of the Chinese dreams being realized by 2049.

Can this role as the main buyer of goods enter into crisis, or will it continue despite the ups and downs of the world?

I believe that a distinction must be made between the period before economic reforms and the current one. The Western world always tends to make the comparison using the double-digit growth rates it had before the reforms. What was sought was a new context for growth that means improving the efficiency of investments, betting on innovation, as well as the development of the domestic market, and the productive move from heavy to light manufacturing and, consequently, to services. And that means that the employment elasticity, that is, the percentage of employment that is generated for every GDP point, improved with these reforms.

I would say that the centenary of the Chinese CP places China in a dual situation, excited for its achievements, but at the same time, as a threat to the West, which seems to be articulating against the aspirations of the Chinese dreams being realized by 2049.

In other words, if before the reforms China needed a 10, 11 or 12 percent growth to generate 11 million urban jobs that are required to keep the unemployment rate constant, today it does so with a 5-point growth rate. Those who say that China is not growing at 10 percent and that is a sign of weakness, do not understand what is really happening, because, this double-digit growth was generating very serious environmental and distributional conflicts, therefore, it could not be sustained much longer.

China's 5% growth rate indicates stability for the Global economy, as well as heated demand for raw materials and natural resources.

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From the Latin American point of view, China is the main trading partner of most countries and there are those who say that this dependence threatens intraregional dynamics. Is it possible for both ideas to coexist?

Not only they can exist, but they should. China cannot be held responsible for the region not making progress in integration. That is an absurdity that I had never heard of. The Integration process is not moving forward because we are experiencing a pathetic absence of leadership. I can't find another time in history in which national leaders were so mediocre to the point that the challenge is to define an agenda for cooperation with China. When the Celac-China Summit was held, Beijing sought the relationship with all the countries and after the meeting decided to create a special monitoring office. No country or organism, not even the Mercosur, or the Pacific Alliance, created anything similar. The ball is in our court. No one can ask China to define regional priorities, if it buys copper from Chile or soybeans from Argentina, it is welcome to do so.

We are the ones who have to define industrial policies in order to allow us to diversify production and improve the technology content of our exports. If our leadership and parties do not take the responsibility, it is our own fault.

What can be said about the Chinese leadership in these 100 years, especially Deng Xiao Ping?

Deng was the great architect of economic reforms, a leader in the country's economic transformation. He was close to Mao at the beginning of the revolution but also very opposed to him, and spent four years relegated and detained in his home as part of the Cultural Revolution.

China cannot be held responsible for the region not making progress in integration. That is an absurdity that I had never heard of. The Integration is not moving forward because we are experiencing a pathetic absence of leadership.

When he returned after Mao's death, he performed a mental analysis of how badly he was managing the country in economic terms and the poor quality of life of the peasants, whom he knew intensely during his period of reclusion, He then came to the conclusion that the Chinese socialism was not responding to the needs of the population, while learning about what was happening in Southeast Asia, in countries such as South Korea or Hong Kong, and Singapore, which were developing. He then defined a complete shift in 1978. Deng is a figure to be studied, a statesman, a strategist, and great planner.

What about Xi Jinping?

He is the continuation of the logic of reform and openness, but has clearly broken with some precepts of Deng's legacy, as seen with the economic failure of the mid-50s called "Great Leap Forward" and the cultural revolution of the mid-60s. Deng conveyed three principles:

1-That authorities should not be eternal and both party and state authorities should only serve periods of 5 or 10 years maximum in office.

2-An avoidance of the same official having various positions, such as the case with Mao, who was chairman, leader of the party and leader of the military commission.

3-China must not avoid excelling greatly from the international stage until it fulfills its dream. It should keep a low profile.

These three points from Deng's legacy were not respected by Xi and so we wil need to observe how that evolves over time.

His spin is less collective and more personal, without any doubts.

China is powerful, there is a vindication of its achievements, but it is a single party that does not respect the democratic parameters of the West. What can be said about china's democratic system?

It is totally different from the Western liberal model promoted, at least in the discourse. The second thought is that, in its five thousand years of history, China has not known the liberal-Western system style, which opens questions regarding those who believe that the only existing model is that of the UNITED STATES or Europe.

Xi has a less collective and more personal leadership than Deng, whose heritage was not respected in the way that he questioned regarding authorities being eternal and concentrating power, as was the case with Mao.

The arguments of specialists are that this Western model is 200 years old and that system has a five thousand years history. There is a challenge to be faced and an ongoing issue, but what I infer is that China promotes an implicit social pact: citizens demand economic growth, quality of life, well-being. and the fight against corruption from the State and the party, and to the extent that this is guaranteed, the need for Western democracy tends to be smaller. But that is an issue that is in process, the new generations are special, they did not live through the recession, there was no recession during the year of the pandemic, they feel that the quality of life improves every year. The rise is sustained and this one child generation, whose lives improve continuously, end up acquiring more of a Western style. We are talking about 200-300 million people who have access to luxury goods and sophistication that can collide with the system.

How much more can the conflict with the United States continue to escalating?

Unfortunately, everything indicates that this conflict will be going on for decades. Those who thought this was going to end with Biden should assume they were wrong. The legislative project that the American press calls "Project China," is based on an industrial policy worth million with no comparison, which Biden compared to the landing on the moon. It is aimed at slowing Chinese progress in new technologies by putting the US at the forefront of the 5G network, as well as Artificial Intelligence, and robotics, which are issues that allowed Washington to strengthen its relationship with European countries like Germany in order to define China as a systemic competitor, and block its investments in technology to prevent access to certain key inputs that are vital for the development of new technologies.

Everything indicates that this conflict will be going on for decades. Those who thought this was going to end with Biden should assume they were wrong.

Hence, China responded with the dual-circulation strategy, placing emphasis on domestic innovation. This is an ongoing process and it needs to be followed very closely. Strengthening the need for regional cooperation in order to avoid taking a position in the face of this hegemonic struggle will be vital for what is to come.

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The conflict also relates to the vaccines...

There is no doubt. The vaccine war is one more chapter in this long saga of international dispute. There is a very strong communication campaign and it is evident. We will have to wait a few years for historians to define it, since within today's situation and scenario, the information is not entirely reliable from either side.

China has macroeconomic challenges, including the housing bubble and the regions' high public debt. Income distribution has also worsened. To sustain its growth it needs innovation, which is why the lockdown on Huawei and 5G impacts the Chinese model.

What are the challenges that China faces moving ahead?

China has macroeconomic challenges, including the housing bubble and the regions' high public debt. It must continue to innovate to ensure growth rates with lower investment spending, thus expanding consumption. For that, they will need to spend on more robust social security systems so that families can save less and buy more. The Country will also face environmental, energy and distributional challenges. The distribution of income has worsened and, lastly, there is the demographic challenge that began in 2013 with the stagnation of the population growth. All these challenges require the productivity to increase and, to face that, innovation is key. Therefore, the blocking of new technologies, such as what is going on with Huawei and 5G will impact the Chinese model and its expansion dynamics in the coming years.