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CHINA DAILY Thursday, August 22, 2019 | 9Wang Dong Yu Ze
Expand rural
market to
boost overall
consumption
competitive rival by canceling
its authorization for the use of
Android. That would be a viola-
tion of business ethics, too.
Shi Ziguo, a PhD candidate in
the Department of Economics,
Party School of the CPC Central
CommitteeMuch needs to be done to
attract global consumers
Huawei displayed the much-
anticipated Harmony OS, fea-
turing low latency and strong
security which will be mainly
applied to the internet of things,
during a recent developer con-
ference. Despite the sparing use
of Harmony on smartphones,Mobile operating system
a natural development
Hardware companies tend to
develop their own operating sys-
tem, which is also true for
mobile phone makers. Sam-
sung, for instance, has made
repeated attempts at developing
a mobile operating system,
including Tizen.
With its share of the hard-
ware equipment market gradu-
ally increasing, Huawei, too, is
expected to leave its mark by
creating a new operating system
and high-tech ecosystem. That
the company started trials for
Harmony in 2017, more than a
year before the United States
launched the trade war against
China shows its innovative and
industrial prowess, apart from
attesting to its foresight.
Now, Huawei can easily
switch to the Harmony mobile
operating system, which it has
developed and whose intellectu-
al property it fully owns, if
denied the authorization to use
Google’s Android because of the
US ban. As Huawei Consumer
Fostering a new balance in Sino-US ties
T
he “contraction” trend
is becoming increas-
ingly prominent in the
United States’ foreign
policy thanks to its “America
first” approach. Once the major
provider of global public goods,
the US is becoming a penny-
pinching country focused solely
on its national interests and
thus weakening its internation-
al leadership.
Yet despite the contraction of
its diplomacy, the US has gone
on the offensive on particular
issues, trade being the most
prominent. Launching trade
wars against nearly all major
economies such as China, the
European Union and Japan, the
White House is using the trade
brawls to appeal to the US lead-
er’s base even though tariff-slap-
ping at will, and without any
reason, goes against established
trade practices and the World
Trade Organization’s rules.
Besides, the US administra-
tion has shown an inclination
toward revisionism on the Tai-
wan question, with a number of
pro-Taiwan officials holding key
decision-making positions in
the US. The US leader’s phone
call to Taiwan leader Tsai Ing-
wen and his statement to sub-
stantially improve “US-Taiwan
relations”, together with the US’
other provocative moves includ-
ing sailing aircraft carriers
through the Taiwan Straits and
endorsing laws such as the Tai-
wan Travel Act and Asia Reas-
surance Initiative Act of 2018
are all aimed at checking the
Chinese mainland’s rise.
Since the US could try to
ratchet up tensions across the
Straits and some separatist ele-
ments on the island could
demand “Taiwan independ-
ence” in a bid to restrain the
mainland, Beijing should be ful-
ly prepared to deal with any
eventuality.
China could play a key
role in “re-globalization”
By listing China as a strategic
competitor in its National Secu-
rity Strategy report, released in
December 2017, the US adminis-
tration has dealt a serious blow
to Sino-US relations. Equally
importantly, the report also
reflects the US elites’ ideological
bias against China as well as
their anxiety over China’s rise.
Contrary to the US’ populist,
anti-free trade and anti-globali-
zation practices, China has been
firmly promoting globalization
— which currently is at a stage I
call “re-globalization” given the
new momentum and emergence
of new rules. While China has
been extremely open-minded
and constructive about free
trade and globalization, the US
has become increasingly
inward-looking and self-cen-
tered. And since these differen-
ces cannot be resolved in the
short term, China should fur-
ther deepen reform and open-
ing-up to help boost “re-
globalization” and proactively
participate in the negotiations
aimed at reforming the WTO.
Notwithstanding the twists
and turns in Sino-US trade talks,
trade remains the pillar of over-
all Sino-US relations, and any
attempt to change the bilateral
trade equilibrium would invite
frictions, conflicts and restruc-
turing of interests. Also, this
process could last a few years, as
it involves not only changes in
the US’ political and socioeco-
nomic development momen-
tum, but also China’s economic
restructuring and deepening
reform. Striking the right bal-
ance in Sino-US trade, on the
other hand, will help foster a
new balance in overall bilateral
relations.
Despite the call of certain
ultra-conservatives and China
hawks for decoupling the two
economies — which incidentally
could signal the beginning of a
new “Cold War” — voices of rea-
son exist in both the US and the
international community. A new
Cold War will put global peace
and development at risk apart
from inflicting pain on the
world’s two largest economies.
So a coordinative and stable
Sino-US relationship, which is
essential for the healthy devel-
opment of the world order, is
what all parties should strive to
achieve for the good of the
whole world.Strengthen exchanges
between the people
To achieve that, the three
foundations in the Sino-US rela-
tionship — political trust, eco-
nomic and trade cooperation,
and people-to-people exchanges— should be strengthened.
Among which, people-to-people
exchanges should be seen as a
cornerstone against the present
background. As Chinese Presi-
dent Xi Jinping said, the key to
sound relations between states
lies in amity between the people.
The silent majority in both
countries including tens of thou-
sands of people traveling
between the two countries every
day cannot be ignored when it
comes to overall Sino-US rela-
tions. Even though the US has
attempted to reduce people-to-
people exchanges by restricting
Chinese scholars and students
from visiting the US and clamp-
ing down on the Confucius Insti-
tutes there — to China hawks’
satisfaction — more than 100
former officials and China
experts have jointly issued an
open letter calling the US not to
view China as an enemy. Whichshows the US administration’s
attempt to reduce people-to-peo-
ple exchanges does not enjoy
popular support, as many in the
US know such exchanges are
vital to the healthy development
of bilateral ties.
As long as China and the US
continue to push bilateral rela-
tions forward on the basis of
non-conflict, non-confrontation,
mutual respect and win-win
cooperation, they can meet the
challenges they face at present
and Sino-US relations can be
guided toward coordination,
cooperation and stability.The author is executive deputy
director of the Institute for Chi-
na-US People-to-People
Exchange, Peking University.
The views don’t necessarily rep-
resent those of China Daily.T
he recent meeting of the Political Bureau
of the Communist Party of China Central
Committee said domestic demand
potential should be tapped, and the rural
market and overall demand expanded.
Facing the complicated global economic envi-
ronment, China has to boost domestic consump-
tion and strengthen the industrial chain to
achieve high-quality development, for which it
has to further deepen reform.
Since the beginning of this year, thanks to
growing global uncertainties including trade dis-
putes, Brexit and some economies’ protectionist
policies, the global Purchasing Managers’ Index
has been declining with the new export orders
index registering negative growth. And global
organizations including the International Mone-
tary Fund, World Bank and the Organization for
Economic Co-operation and Development have
downgraded their global growth forecasts, reflect-
ing the rising risk of global downturn.
Many major Western countries have not yet ful-
ly recovered from the 2008 global financial crisis.
Long-term, low-speed economic growth made
former US treasury secretary Larry Summers
highlight the “secular stagnation hypothesis” in- According to the hypothesis, advanced by
Alvin Hansen in the 1930s, it may be impossible
for an economy to achieve satisfactory growth,
financial stability and full employment simultane-
ously by using conventional monetary policy if it
remains in depression for a long time.
The key evidence of “secular stagnation” is that
the natural rate of interest in Western economies
including the United States, Canada, Britain and
the European Union is declining. In particular,
the EU needs negative natural rate of interest to
maintain sufficient employment, which is hard to
achieve given that both its nominal interest rate
and inflation rate are very low.
Besides, a low interest rate in the long run risks
creating global asset bubbles, which in turn could
result in gloomy global growth prospects.
Since the 1990s, globalization has been led by
the multinational corporation-dominated global
value chain and super-large scale capital flow
across the world under a multilateral negotiation
framework.
The period also saw major Western countries
embracing neoliberalism and loosening or with-
drawing their control over the interest rate and
credit, and privatizing state-owned financial orga-
nizations. But a large part of the expanding global
financial trade centers on high-risk hedge funds,
not on productive activities.
Under such circumstances, the existing global
organizations cannot effectively cope with the
economic fluctuations, giving rise to political
issues in various countries which in turn have
undermined globalization.
The external risks for China may continuously
increase given the uncertain global economic
environment, and the global downturn will slow
China’s export growth rate.
Moreover, the new phase of globalization, by
restructuring the existing industrial chain, could
threaten the global distribution of labor and fac-
tors of production. As such, China should
strengthen the domestic industrial chain to cope
with the uncertainties created by the changing
global distribution of labor and to boost con-
sumption.
The authorities should also further deepen
reform, rather than using short-term stimulus
measures, to boost consumption. About 40 per-
cent of China’s population lives in rural areas but
accounts for less than 15 percent of its total con-
sumption, which means rural consumption has
much room for expansion.
Although the consumption structure of urban
and rural residents is similar, rural residents
spend more on food, tobacco, alcohol and health-
care, while their urban counterparts spend more
of their income on clothes, education, culture and
entertainment. Rural consumption can be raised
in three ways.
First, by improving the medical services for
rural residents, the authorities can help reduce
their healthcare burden, leaving them with more
disposable income to spend on other goods and
services.
Second, by improving the telecommunications
infrastructure in rural areas during the 5G con-
struction phase, the authorities can encourage
rural residents to spend more on telecom servi-
ces.
And third, by taking measures to increase farm-
ers’ incomes, the authorities can boost their con-
sumption potential. Only when farmers’ incomes
increase can rural consumption continuously
grow.The author is a researcher at the School of Eco-
nomics, Renmin University of China. The views
don’t necessarily represent those of China Daily.Harmony another beginning for Huawei
Business Group executive
director and CEO Richard Yu
said, it is easy to transfer popu-
lar applications such as Face-
book and WhatsApp to
Harmony.
Back when Microsoft’s win-
dows operating system domi-
nated the market, Apple
managed to build its own oper-
ating ecosystem by combining
its advantages in both software
and hardware, which turned out
to be a huge success. So Huawei,
too, has a chance to succeed,
especially because of its notable
strength in hardware and strong
support from the massive Chi-
nese market and billions of con-
sumers.
Huawei has not yet installed
Harmony in its cell phones,
mainly because it is difficult to
make progress in the software
ecosystem of smartphones in a
short period. Also, it would be
expensive and risky for Huawei
to use its own operating system.
As for Google, it has certainly
not made the right choice — of
forcing Huawei to become aHuawei hopes to develop a
whole new Harmony ecosystem
that could challenge Google’s
Android and Apple’s iOS.
To meet its goal and secure
success worldwide, Huawei
should pay special attention to
three things. First, it should be
able to provide all the functions
and services that users demand,
the lack of which has resulted in
the failure of multiple operating
systems including Microsoft’s
Windows Phone system. Apart
from making Harmony compati-
ble to apps such as WeChat,
Facebook and Instagram, Hua-
wei must also solicit the exten-
sive support of more developers
to promote its new mobile oper-
ating system, which is the first
step toward building an ecosys-
tem.
Second, it is necessary for
Huawei to offer unique applica-
tions and services, similar to
Google Map and Gmail that
have the potential to become a
distinctive advantage of Harmo-
ny and therefore attract interna-
tional audience and buyers. Inthis sense, it has much work to
do to become a real global play-
er.
Third, Huawei has to expand
its presence in people’s every-
day life. This is an area in which
its strength in hardware would
prove to be a boon. To support
more smart devices, Huawei
should further increase the
multi-platform performance of
Harmony in the next three
years, including its capability to
support multi-equipment and
multi-platform uses and to
maintain low latency and
strong security.
Besides, Harmony must iden-
tify the threats and fix them at
the earliest while timely updat-
ing the system in order to sub-
stantially enrich user
experience.Chen Zhi, director of the Insti-
tute of Science and Technology
for Industrial Development, Chi-
nese Academy of Science and
Technology for Development
The views don’t necessarily rep-
resent those of China Daily.Editor’s note: Can Huawei overcome the US sanctions by installing its own mobile operating system Harmony OS instead of Google’s Android in its smartphones? And will
there be a new competition among Harmony, Android and Apple’s IOS in the future? Two experts share their views on the issue with China Daily’s Liu Jianna. Excerpts follow:
... more than 100
former officials and
China experts have
jointly issued an
open letter calling the
US not to view China
as an enemy. Which
shows the US admi-
nistration’s attempt
to reduce people-to-
people exchanges
does not enjoy
popular support ...And third, by taking measures to
increase farmers’ incomes, the
authorities can boost their
consumption potential. Only
when farmers’ incomes increase
can rural consumption
continuously grow.... Huawei has to
expand its presence
in people’s everyday
life. This is an area in
which its strength in
hardware would
prove to be a boon.SHI YU / CHINA DAILY