The Story of China’s Economic Rise Unfolds in Switzerland

That choice proved fortuitous.

Mr. Qian was not the average economist but had remarkable political connections. He had become an outspoken advocate of land reform in the 1930s and early member of the Chinese Communist Party after his father, a tenant farmer, was beaten up by a landlord and jailed. Mr. Qian saw combat against China’s Nationalists as a political officer in the People’s Liberation Army. After the Communists prevailed in 1949 in China’s civil war, he served as a vice minister of education and as Communist Party secretary of the Ministry of Culture.

Prison and the near collapse of the Chinese economy during the Cultural Revolution turned him into a market-oriented reformer. After his release from prison in 1975, he became the head of the Institute of Economics at the Chinese Academy of Social Sciences. The academy was unique at the time: It was the only government-authorized international policy research group in Beijing, although now Beijing has many such research groups.

After his visit to Davos, Mr. Qian quickly arranged for the Chinese Academy to establish a partnership with Mr. Schwab and the forum. The forum had the benefit of Switzerland’s reputation for political neutrality. Beijing and Washington had backed opposite sides in the Vietnam War, which had ended only four years earlier, so business and economic contacts with the United States were mostly politically off limits in China.

The forum quickly began playing a key role in bringing European investment and business ideas to China. Concepts like joint stock ownership of businesses, instead of cooperative or communal ownership, were developed in China in the early 1980s partly through contacts and discussions at the forum.

Davos, a small resort town in a German-speaking area of Switzerland near Zurich, is three hours’ drive from Munich. German multinationals have long played a big role at the forum. German companies moved faster than practically any other country’s companies in the early 1980s to enter the Chinese market, partly using the forum’s connections.

Today, the leaders of China’s state-owned enterprises use their attendance at the forum to allay any overseas concerns about their expansion into international markets, said Justin Lin, the director of the Center for New Structural Economics at Peking University.

Article source: https://www.nytimes.com/2020/01/18/business/davos-china.html?emc=rss&partner=rss