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Ding Gang: Cooperation, not rivalry, vital for globalization

2018-02-08

By Ding Gang    Source: Global Times    Published: 2018-2-7


Five years ago, a New York Times reporter wrote in his Pulitzer Prize-winning article, "All iPhones contain hundreds of parts, an estimated 90 percent of which are manufactured abroad." It reveals the essence of globalization. The make of an iPhone is a two-sided picture which clearly shows how China and the US are caught up in competition and collaboration.


It`s hard to tell how many spare parts of an iPhone are manufactured in China, Japan or South Korea, but it`s certain that without globalization, iPhone would be impossible to assemble, and no country could make it all by itself.


The US, China, Japan, South Korea, Germany ... all these countries have a share in the production line and share profits in the chain. The chain involves many industrial and service sectors, extending to many other countries all around the world.


During my recent visit to the US, I seldom saw shoes, clothes and small household electronic appliances tagged "Made in China" in supermarkets and department stores. Most of them were made in Vietnam, Cambodia, Peru, Malaysia, etc.


Compared with all those low-end made-in-China products 10 to 20 years ago, China`s manufacturing sector has made a great leap forward in the global value chain. When the value chain spread to other developing countries with China`s attempt to forge ahead, more and more American elites believe intense competition will sooner or later occur between China and the US.


Sixteen years ago when China joined the World Trade Organization, many Americans thought the US could regulate China`s development so that it can follow the path set by the US. Today, very few people believe China will make that kind of change. They are disappointed and became pessimistic about the future.


It was also 16 years ago when I worked in New York, the American media were hyping almost every day that all the pants and shirts Americans wore were made in China. Their overreaction to globalization has gradually disappeared, and many developing countries have become active members of the global value chain.


At the same time, China and the US have jointly made a lot of high-end products, built up a solid foundation for cooperating, with iPhone as the most distinguished example.


With few similarity in their political systems, China and the US have some similarities in their spiritual pursuits. It is the common values people of both countries follow that will inevitably lead to serious competition, and it is also the common values that will strengthen our coexistence.


Diligence, hard working, loyalty to family, plus the pursuit for excellence will lead to a head-on competition between China and the US. Since the US is still holding the upper end of the chain, China`s efforts at moving up will undoubtedly meet bitter resistance. In particular, it will be reflected in a broad spectrum of competition with countries at the upper end of the global value chain.


However, we need to think about the example of iPhone again.


It`s a product of the global value chain and has come about as a result of collaboration. Each part of the smart phone must fit together perfectly, no matter whether it is produced by the US or China. Its assembly line looks more like a platform for collaboration than a battleground.


The 21st century should be a new era of sustainable development for every nation and all people. We have to seek more win-win opportunities, extend the global value chain, let more and more countries join hands and share the benefits. In addition to competition, we can cooperate. And only cooperation can let us survive.


If there is only competition left, the consequences will be more serious than only the impossibility to produce iPhones.


The author is a senior fellow with the Chongyang Institute for Financial Studies at Renmin University of China.

Key Words: globalization   US   IPhone   Ding Gang  

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