The financial meltdown caught China off guard—and may make the country hesitate to follow Japan and other East Asian neighbors into full-fledged capitalism.
Question: Is China trying to mimic the economic rise of its East Asian neighbors?
Edward Tse: Actually as China started this economic reform back in the late ‘70s, you know, China was looking out to other economies to try to sort of learn from other economies about experiences and so on, because China was really struck about how backward China was compared to the rest of the world, so the first series of economy studies China tried to learn from were Hong Kong, Taiwan, Singapore, the so called tiger states and they you know they learned something and then the next stage of countries that you know the Chinese were trying to learn from were Korea, Japan, you know, the so-called East Asian model, and then the first stage was you know many of the western countries, the western European countries, America and so on and the Chinese were just, you know, very curious about what can work and not work. And of course, you know, every of these markets or countries or economies are very different because the context are very different. China is huge. China is, you know, in a way, you know, to start with a very low base, so how can China sort of accelerate this process, so China would need to learn from the very best from the rest of the world and I say that you know China has picked up very different things from different economies in the whole process of learning from these various economies, but one thing that is in a way is also quite shocking to the Chinese was what happened in the global financial crisis back in the late…2008, and to the Chinese, you know, the abrupt collapse of the financial system and the collapse of many corporations in the west was a major shock to the Chinese, so it leaves some questions for the Chinese of you know what is actually the best operating model. I don’t think the Chinese also have figured it out, but we certainly have learned a lot during this process.