China is one of the most fascinating countries in the world. Ever since it opened up in 1978 after a slew of economic reforms, its growth trajectory has astounded the world. The size of the Chinese economy in 1978 was US$150 billion, but by 2018 it was US$13 trillion. During this period, China has modernised its infrastructure and lifted 800 million people out of poverty. It has become the world’s manufacturing hub, and no serious businessperson can afford to ignore China. It managed to achieve all this while being ruled by a Marxist-Leninist-Maoist party called the Chinese Communist Party (CCP).
Its governance framework is almost a mirror image of the framework of the Soviet Union. For example, just like the Communist Party of the Soviet Union (CPSU), it has a central committee and a politburo. In every sector of society, there is a shadow of the CCP. For example, in the Department of Electrical Engineering in a university, the department head is shadowed by the Secretary of the CCP in the department. The president of a university is shadowed by the Secretary of the CCP. This shadowing mechanism is found everywhere, including in companies. The CPSU called these shadows of the communist party the vanguards or the political commissars.
In the Soviet Union, these representations of the communist party at all levels of the economy and society resulted in innovation stifling. This led to stagnation and ultimately resulted in the collapse of the Soviet Union. But in China, this same system has not stifled innovation but, on the contrary, has made the Chinese economy grow faster than any country in history. In trying to understand China’s growth, I read Deng Xiaoping and the Transformation of China by Ezra Vogel about the man most credited for taking China into the modern world in 1978. So, who was Deng Xiaoping?
Deng was born in 1904, eight years before the fall of the Qing dynasty and the Republic of China’s birth, in Sichuan Province. He was educated in China before going to France to further his education. This is where he was recruited to join the Chinese Communist Party. In France, he was disappointed that the education that he had hoped to get did not materialise. Instead, he went to the Soviet Union for his studies before going back to China to fight in the revolutionary war led by Mao Zedong. When the CCP took over in 1948 and united mainland China, Deng became a high-ranking government official, including being a Vice-Premier.
During the upheaval of the Chinese Cultural Revolution, Deng was side-lined because of his reformist posture and sent to Jiangxi province, where he worked as a tractor mechanic. His son, Deng Pufang, was tortured by the Red Guards and thrown out of the fourth floor and became paraplegic. The Red Guards were revolutionary young people who were instrumental in the Chinese Cultural Revolution. He eventually came back after Mao’s death and the Gang of Four’s arrest. The Gang of Four was a group of four people, including Mao’s wife, who played a prominent role in the Cultural Revolution. Mao was succeeded by Hua Guofeng, whose theory of “two whatevers” advocated parroting Mao was deeply scorned in China. In 1978, Deng emerged as the paramount leader of China and ushered in the reform.
Deng realised that central planning, a policy of the CCP, did not allocate resources efficiently. Deng decided that for China to succeed, it would have to take the principles of allocation of resources from the capitalist system. He called this new economic theory of socialism that takes asset allocation from capitalism “socialism with Chinese characteristics,” or the socialist market economy.
Deng was an advocate for the peaceful rise of China. He believed that as China rose, its leadership should minimise disruptive opposition from both inside and outside the state. In this regard, he adopted the old Chinese adage from Sun Tzu’s The Art of War, which says: “Appear weak when you are strong, and strong when you are weak.” In line with this, Deng would form a foreign policy based on the principle “Hide your strength, bide your time.” Tanzanian President Julius Nyerere once asked Singapore’s Prime Minister Lee Kuan Yew why the Chinese government went out of their way to assure other countries that they have no imperial ambitions. Lee answered that China did not want any resistance to its rise as a global power.
Deng also realised a need to bring more young people into China’s leadership, who are more technically educated. He stated that those who rule China should have the technical know-how of people who could go and operate a factory. This, he stated, would give the Chinese people confidence in industrialising China. In this regard, Jiang Zemin, Hu Jintao, and Xi Jinping are electrical, civil, and chemical engineers, respectively. Even though Deng was a paramount leader of China, he refused to be president of China and was never a premier. When asked about this, he stated that there were many younger and more educated people in China who could take those top two jobs.
Deng also understood that for China to succeed, it would have to open to the outside world. He encouraged Chinese students to study abroad, establish connections, and gain western education. When deciding on opening up parts of China, Deng took a map of China and circled a rural area called Shenzhen, and declared it a special economic zone that would serve as a magnet for outside economic and technological investment. Today, Shenzhen city has 12 million people, is a $640 billion economy, and is more affluent than South Africa – with its population of 55 million people. South Africa is now also establishing special economic zones; however, whether these economic zones will have sufficient economic gravity or innovation to attract investments and economically transform our people remains to be seen.
Additionally, Deng realised the need to capacitate China internally. He invested in education after 15 years of closure during the Cultural Revolution. He understood that China would need to get rich and asserted that some people would get rich first. In this regard, he declared that “to be rich is glorious.” This was a pragmatic stance given his Marxist-Leninist politics. Deng understood that tackling poverty in China was a paramount objective. As he said, “To uphold socialism, we must eliminate poverty. Poverty is not socialism”. Deng understood that China’s productive forces needed to be modernised by skilling people and building scientific and industrial capacity.
What are the leadership lessons we can learn from Deng? Firstly, a leader must have a plan. Deng had a clear vision for China, and he executed it with unrelenting resolve. Secondly, it is vital to building the capacity to implement the countries’ goals. Thirdly, technical capability, especially at the leadership level, is essential. Fourthly, setbacks are useful for reflection and effective move towards achieving goals. As we interrogate leadership after the pandemic, these lessons are the key to emerging on the other side with bright prospects.
Professor Tshilidzi Marwala is the Vice-Chancellor and Principal of the University of Johannesburg. He is the author of the book: Closing the Gap: The Fourth Industrial Revolution in Africa. Follow him on Twitter at @txm1971.