Prof. Zhang Weiying: Entrepreneurship Key to Economic Recovery

Dec 27-2022   

China should aim for 3% annual economic growth in the coming years and consolidate institutional arrangements that truly boost the role of entrepreneurs, said Prof. Zhang Weiying of the NSD in a recent event.

His proposed figure takes into account the fact that the Chinese economy is shifting to an innovation-driven pattern. He cited the examples of countries like Japan and South Korea, which saw annual growth rate plunging from decades-long 8-9% to 3% as they started to rely heavily on innovation.

To regain healthy growth, Prof. Zhang advised drawing lessons from the early days of reform and opening up when China successfully emerged from daunting economic challenges. Of utmost importance is to emancipate the mind, seek truths from facts, and give people more freedom so that they feel in control of their own destiny. In other words, when appropriate environments are created, people will take responsibility for their own undertakings, rather than blaming the others – a problem that is gripping the society right now, said Prof. Zhang.

Much current talk about stimulating consumption and investment is misplaced, said Prof. Zhang, emphasizing that they both are aims and not means. Only when entrepreneurs create jobs can income be generated, which then results in consumption. When entrepreneurs lose confidence, the society will be confronted with tough challenges.

He also believed that a market economy that gets entrepreneurial spirit into full play is the best institution for achieving common prosperity. His statistical analysis showed that of China’s regions, those with higher density of entrepreneurs boast higher per capita average income, lower poverty rate, and smaller Gini co-efficient.