While in China, I could not help but acknowledge the beauty of its economic system: a great combination of communist achievements and the creeping capitalism. From Hong Kong to the mainland Shanghai and from Beijing to the vast countryside, one can see China's corporate life on the move.
China is on a 'long march' to capture foreign markets and develop resources as part of Beijing's 'go forth' policy to ride the globalization bandwagon. From Mao Zedong's agriculturalization to Deng Xia-piong's industrialization-cum-liberalization, the communist giant has come a long way.
Nonetheless, it is commonly believed that nations ruled by communist parties are regimented societies and most of them a tale of unimaginative failures. But China seems to be an exception in this regard. Beijing's economy is growing at a break-neck speed.
Its market economy and rampant consumerism of 1.4 billion souls, supplemented with the ideologues of Maoism, have surprised economic pundits worldwide.
With the state providing housing, education and medical facilities to its citizens, China has vastly been able to keep the poverty graph within checks.This does not mean that there is no imbalance in development across the country, but exclusive efforts seem to be at work to undo such disparity.
China is racing to register itself as the superpower within a decade. Meanwhile, the world looks at the phenomenon of 'made in China' with awe and ponder over its repercussion the moment the WTO comes into effect.
Widespread construction and mass consumerism are the two pillars keeping the economy moving accompanied by cheap labour. Car production is on the rise and millions of vehicles are manufactured every year.
There are about 300 million mobile phone users. Shopping malls are crammed with designer clothes, real and counterfeit. China's economic growth is around 8.5 per cent-an aspect that is said to be unprecedented.
Chinese firms are moving up the ladder as their country's membership of the WTO guarantees them access to world markets. From toys to computer chips, just about everything seems to come from China these days.
A study by Goldman-Sachs predicts China will overtake Germany in economic output by 2008, Japan by 2015 and the United States by 2040. If the Chinese kept up with the pace of growth, they are bound to overtake Britain and France to become the world's fourth biggest economy much before the end of 2005.
Another feather in China's cap of late is that it has started conducting transactions in reminbi (Chinese currency) within the Hong Kong territory. The legalization of offshore trading in the reminbi has come sooner than expected and is supposed to be a blessing in disguise to the economy.
China's capitalist icons- Hong Kong, Shanghai and Macau- are Beijing's bargaining chips not only on the economic and financial fora but also politically when dealing with the West, especially the United States.
Similarly, as part of its policy to adapt capitalism, the mainland wants to see more plastic money transactions and has told its merchants that they expect at least half of their transactions by 2008 to go through credit cards eying Beijing Olympics that year.
In part, China is bracing for an anticipated surge in foreign credit card spending during the Olympics and the 2010 World Expo in China's commercial heartthrob-Shanghai.
However, China's consumer patterns are not credit-friendly. It's central bank says that card spending accounted for only 2.7 per cent of overall consumer spending in the year 2001.
Moreover, only about 5 per cent of Chinese credit cardholders revolve credit, according to the Nilson report, a payment-card industry newsletter based in California. That compares to 75 per cent of US cardholders who revolve credit at least once a year.
More than reforming its economy and consumption patterns from a communist-guarded structure to a liberalized economy, China has other intrigues to mend. The foremost is the ensuing trade war with the Americans.
As per the recently slapped curbs on trade with Beijing, the American textile lobby sees quotas as just a first shot to curb China's robust exports.
Disagreements over trade are likely to be the greatest challenge to China-US relations for the year 2004 - until presidential elections are over this November. The hang-up is more political than economic- mainly for public consumption.
Business leaders are already hailing China as the powerhouse for growth in Asia - a role once held by Japan. With neighbouring nations increasing sales of raw materials to factories in China, imports jumped by 40.5 per cent in the first nine months of the year.
Many of those factories are foreign-owned - as multinational firms rush to exploit China's abundant cheap labour. The latest is Ford, which announced plans for a new $1.5bn plant in Chongching.
Nevertheless, the risks for the Chinese economy are growing along with its size. A flood of spending on property and construction has raised fears of overheating and highlighting the problems of over-lending by Chinese banks. Shanghai and Beijing's construction boom surprised everybody.
With credit easy to acquire, as almost all worldwide financial institutions have their offices in Shanghai, fixed-asset investment rose 30.5 per cent in the first nine months of last year. Such is the risk of overheating that economists now believe the government is downplaying the pace of growth.
The beauty of Chinese economy is that even the Sars could not thwart its growth rate. Chinese look at the disease as 'a biological weapon' which could scuttle its economy.
Despite being quarantined for almost a year, Chinese have succeeded in maintaining its growth. With the fears of Sars receding, the economy surged 9.1 per cent in the July-September period as domestic firms and foreign manufacturers ramped up investment.
The Chinese economic performance has forced its regional adversaries to go for a 'collaboration and accommodation' policy rather than 'competition and rivalry'.
India is a point in case. Not only has New Delhi rewritten its trade rules with Beijing but also intends to go soft while resolving political and territorial irritants with the communist giant.
All said and done, Pakistan is quite slow in acknowledging the economic miracle that takes place right over its head. Much of the trade that Pakistanis undertake with China is routed through the informal sector with state apparatus having a little say in it.
To say the least, Pakistan doesn't have a trade commission or consulate in Shanghai to facilitate the rising volume of trading activity in the south-eastern parts of China as well as its Exclusive Economic Zone.