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Americans will not win from the confrontation with China" Interview of Jean-Claude Delaunay by L’Humanité

Translated Saturday 10 August 2019

Americans will not win from the confrontation with China" Interview of Jean-Claude Delaunay by L’Humanité

By 2050, China hopes to become the world’s leading economy. Our comrade Jean-Claude Delaunay, economist and vice-president of the World Association for Political Economy, gives the newspaper l’Humanité the keys to a rapidly changing Chinese economy.

Humanité How to analyze the current trade war in China and the United States?

Jean-Claude Delaunay:

The United States seems to be five years late in discovering the Chinese strategy of a "new normality". It is not only a question of achieving social progress, but also of developing productive forces: the Internet, electronics, artificial intelligence, the development of 5G...

Washington is afraid.

I think this is a war because the United States is afraid of losing its position. The military confrontation being difficult to conduct, they are continuing an economic war. Faced with this, the Chinese have an extremely patient peaceful strategy. They surround themselves with the confidence of developing countries, who support this strategy, which does not advocate war, without being naive - China has developed its defence capabilities - but which seeks to defuse conflicts through dialogue. The Americans will not win from this confrontation.

H: Criticisms are emerging around the new silk routes and the increase in debt in partner countries. Is this a real danger?

Jean-Claude Delaunay: The developing countries concerned by this strategy are the first to consider that China is on their side. Just look at the number of African heads of state present last year for the summit of the Silk Roads. Why? Why? Because China is considered as a counter-power on this continent, the crossroads of world imperialism. The supposed Chinese hegemony is a counter-fire launched by the Western powers. China is developing infrastructure that remains at the disposal of States, it is not looting. It is accused of buying land to feed his population. These are the kinds of problems that the world should be addressing: how to feed the entire world population, including the Chinese? For the time being, we let it manage. This is not strictly speaking imperialism. There has been a dulling of this term. Imperialism is war.

H: China defines itself as a developing country with a socialist market economy....

Jean-Claude Delaunay: I think that socialism will inevitably be commercial. We can dream of a socialism without a market with integral planning, but in China it has completely failed. Mao Zedong followed the Soviet model, which was a model of war economy. It must be understood that the market is not unimodal. I deeply believe that there is a difference between a capitalist commodity and a socialist commodity. The capitalist commodity is based on separate companies that produce goods that inevitably carry profits. A socialist commodity can have a macroeconomic orientation. Chinese companies, for example, produce reactors according to a planned energy production project. It is a commodity oriented towards global production that does not necessarily generate profits. In a socialized economy, investment can be distributed differently. One company does not make a profit but another will finance it. The socialization of investment is a significant step forward. Socializing means that we can plan, rationalize, control investment, study the effects on the workforce. In this kind of investment, the capitalist market is blind. Everyone invests in their own corner and this produces overaccumulation.

H: China has experienced these problems of overaccumulation. Is its way of dealing with the issue different?

Jean-Claude Delaunay: It cannot be denied that there are socialist-type overaccumulations of a different nature from those of a capitalist regime. This may, for example, involve an overestimation of the amount of steel required. Increasing the market is one way to combat overaccumulation. The Chinese have also become aware of the need to develop their internal market. One of the differences of the socialist market is the functioning of the labour force. After the 2008 crisis, China realized that it needed to increase wages and accelerate training. I do not know if the Chinese leaders are convinced by socialism, I believe they are convinced by popular interest. They have a very deep sense of the sovereign nation. They carry with them a story of humiliation that is not so far away. Today, China is barely demonstrating its power when the United States wants to cut it off.

H: China has adopted a new foreign investment law to address the concerns expressed by Western countries. What is the substance of it?

Jean-Claude Delaunay: China’s entry into the WTO in 2001 accelerated the process of opening up to foreign capital. At that time, the multinationals gained confidence and thought that the country would convert to capitalism. For their part, Chinese leaders have fuelled illusions about the willingness of these companies to bring technical and social progress. They have settled in and simply over-exploited the workforce. The peak was reached between 2009 and 2010, with the wave of suicides at Foxconn. The authorities have become aware of a number of problems. A reflection was then carried out on the global crisis and the obligation to set up a strategy for technical progress and raising the level of development. The principle was simple: in exchange for the market share gained, companies were required to accept technology transfer. The Chinese understood that they had to develop themselves while forcing foreign companies to bring them progress.

H: However, foreign companies risk finding themselves behind innovation, through subcontracting...

Jean-Claude Delaunay: They will have to understand that cooperation with China is the only way. Western multinationals are destroying their technical capacity while Chinese companies are strengthening it. Cascading outsourcing is a technological disaster. The outsourcing of contracts certainly leads to increased profits, but from a productive point of view, it is a failure. The Chinese have understood this very well.

Interview conducted by Lina Sankari for Humanity on Wednesday, August 7, 2019

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