Isabela Nogueira is a professor of the Institute of Economics and the Graduate Program in International Political Economy at the Federal University of Rio de Janeiro (UFRJ), and coordinator of the Laboratory for Studies in China’s Political Economy (LabChina). She was a visiting researcher at Tsinghua University (China) and the Institute of Social and Economic Studies in Maputo (Mozambique), visiting professor in International Economics at Aalto University (Finland), and professor of the Institute of Socioeconomics at the University of Geneva (Switzerland). She has been researching on China's Political Economy since 2003 and publishing in several academic journals, such as: Critical Asian Studies; Forum for Development Studies; Revue Autrepart; Revista de Economia Política, Economia e Sociedade; and Revista de Economia Contemporânea.

Pedro Steenhagen. On July 1st, 1921, the Communist Party of China was founded in Shanghai. What were the main political, economic, and social factors, both domestic and international, which led to its creation? What were the Party's theoretical and ideological bases and initial goals?

Prof. Isabela Nogueira. The Communist Party of China (CPC) is, above all, a party which was born out of the anti-imperialist struggle of the beginning of the 20th century, and the consequences of this in the present days are absolutely definitive. The great China from the past had lived under the boots of imperialism since the first Opium War, in 1839, and only regained domestic peace when the Communist Revolution was launched, in 1949. During this time, more than 100 years passed, and that ancient civilisation went through wars, loss of territorial autonomy, social destruction due to opium, economic chaos, mass rapes, so they went through a century of humiliations which only the CPC was able to contain.

This legacy is represented beyond History books. There is a lively perception, both for Chinese leaderships and society in general, that the international capitalist system, which, in its essence, is competitive and predatory, is a threat to China's own existence. Therefore, modernisation is considered a political project: without economic power, there is no national sovereignty. And there is little doubt that only the CPC is capable, in this historic moment, of delivering both things.

Considering revolutionary practices as a standpoint, in line with what the Marxist historian Perry Anderson has said, it is interesting to perceive how the Chinese Revolution, despite being inspired by the Russian Revolution, practically inverted all its terms. The CPC waged an increasingly effective guerrilla war against foreign invasion and, afterwards, against its opponents in the civil war. The ability to combine both rural village reform and resistance to foreign invaders granted the Party something the Bolsheviks never had: enormous prestige and a base of support among the peasantry, the social class which formed the vast majority of the population. Subsequently, the CCP grew exponentially: if, in 1925, the Party did not even have a thousand members, in 1947, when the civil war broke out, there were about 2.7 million members.

The ideological bases of Marxism with Chinese characteristics and its objectives had, therefore, an enormous popular appeal: expel foreigners; restore order and harmony; give centrality to the peasant as a revolutionary force; and prepare the pathways for what would be an organised and fair method of production, bringing well-being to the population.

Pedro Steenhagen. In 1949, the People’s Republic of China was established based on the Communist Revolution, led by Mao Zedong. What were the determining historical processes which enabled the Party to take on the definitive leadership of the country in the middle of the 20th century? What were Mao Zedong’s main contributions, both as a revolutionary and as China’s leader in the subsequent years, to the Middle Kingdom and the international society?

Prof. Isabela Nogueira. When the communists took power in October 1949, China was completely devastated. It is, indeed, quite interesting to wonder how the CPC managed to hold the country together and prevent a counter-revolution from the Nationalist Party, which had the support from the United States, in the years to come. At that moment, the Soviet presence was important, either to support the State organisation give rise to the economic planning, or to forge an initially (and apparently) cohesive socialist bloc. Anyhow, the success of economic reconstruction in the early years, which was the result of the CPC's leadership capacity, turned out to be essential: factories were re-established, agricultural production was resumed, and schools and hospitals were reopened, deepening social support.

Nevertheless, the following years under Maoism present a tangle of contradictions. If, on the one hand, the country greatly improved its health and education indicators, as well as effectively became an industrialised nation, on the other, per capita agricultural production remained static, maintaining poverty as a general national rule (and a population on the verge of food insecurity). This means that, in per capita terms, a peasant in China, in 1952, ate exactly the same thing as in 1976, the year of Mao's death. The misfortunes of the Great Leap Forward (a huge bureaucratic blindness) and the Cultural Revolution (with their persecutions and totalitarian impulses) left deep wounds in the history of the CPC.

Everything was happening in an international environment and under an imminent risk of war: either because of the possibility of launching a war against Taiwan or because of an effective conflict in Korea, the Vietnam War, threats from a Japan which was tutored by the United States, and, finally, conflicts with the Soviets and Indians from the 1960s onwards. Even so, there are glaring errors in the conduction of the country by Mao, and even the CPC has said the famous phrase that he was right 70% of the time (and therefore wrong in the remaining 30%).

Pedro Steenhagen. In 1978, China launched a process of reform and opening-up, captained by Deng Xiaoping. How did this change regarding China’s approach on development take place? What were the main characteristics of this process throughout the 1980s and 1990s?

Prof. Isabela Nogueira. This is the period when China becomes more integrated into global capitalism without becoming neoliberal. The State (meaning the Communist Party) effectively handled this process masterfully and without shock therapies, as Isabella M. Weber shows us in her book “How China Escaped Shock Therapy: The Market Reform Debate”, released by Routledge this year. In the 1980s, China promoted the fastest and most radical poverty reduction in human history, lifting 400 million people out of poverty through agrarian reform based on small production units and purchases of agricultural products guaranteed by the State. These are public policies which deserve to be better studied in Brazil.

During the 1990s, when China effectively opened itself to foreign direct investment (FDI), this was done with was massive regulation. The arrival of FDI in China was characterized by extraordinary State control, which determined, amongst other matters, the obligation to transfer technology and to have a local partner, and the guidance to allocate the investment geographically. Why did foreign firms accept these conditions and settled there? Because of the extraordinary profits achieved in China with cheap labour, good infrastructure, and a huge scale of production. Take heed of this: it all happened in a world that was beginning to witness the process of financialisation and the productive restructuring through the formation of global value chains.

Liberalisation and financialisation took place in most of the world from the 1990s onwards, except China. This is a fundamental aspect of China’s success. It took advantage of global chains to tackle an issue the entire world was reversing and, in many cases, outlawing: a very aggressive industrial policy. Such industrial policy was only so effective thanks to the essential characteristics of the Chinese economic system, such as a mostly state-owned banking system; capital control, which prevented financialisation; State planning; and a national system for innovation.

Pedro Steenhagen. Over the first two decades of the 21st century, China has become increasingly relevant in international politics and economics, particularly under the leadership of Xi Jinping. What are China’s most hefty challenges, both domestically and internationally, regarding the continuity of its development project? How can the Belt and Road Initiative contribute to international cooperation and the building of a “community with a shared future for mankind”?

Prof. Isabela Nogueira. China has entered the 21st century doing what no other country in the world has done in this period: it has quickly scaled global value chains in order to evolve from simply being the factory of the world to becoming a host country for leading firms which set global technological standards. And the process continues. The current phase of the Chinese industrial policy is no longer that of catching-up, or of seeking to pair up with other central countries around the world, but of overtaking, of leading the process of what we call a Fourth Industrial Revolution. This is about a shift in the way things are manufactured, how all is transported, how energy is generated, how cities are organised, how surveillance takes place, and even how wars are waged. China wants to be one of the leading countries in this process.

In this context, no challenge is greater for China than the technological and strategic clash with the United States, the current hegemonic power. This does not mean, in any way, that we are experiencing the re-edition of a new Cold War, quite the contrary. Both countries are deeply intertwined economically and in terms of production; however, if, on the one hand, there are multiple possible scenarios for this confrontation, on the other, there is no doubt the United States will continue to launch increasingly aggressive strategies to try to contain the Chinese development.

The New Silk Road, in turn, is a set of economic policies, diplomatic arrangements, and financial institutions (such as the Asian Infrastructure Investment Bank – AIIB) which ties up the Chinese development strategy for the years to come. It is a multifaceted project to project power, which combines trade, infrastructure, international use of its currency, and various geopolitical interests, such as the control of new energy supply routes. It shows the world how investment in infrastructure in essential to economic growth and to the Chinese strategy.

Pedro Steenhagen. By the end of 2020, the Middle Kingdom announced the eradication of extreme poverty in its territory, and, in the beginning of 2021, it presented its new Five-Year Plan and long-term goals. When one analyses the past 100 years of its story, what are the Communist Party's main contributions to China and the world?

Prof. Isabela Nogueira. The Communist Party of China has showed the world that development alternatives which are not based on neoliberal models are the only way out of underdevelopment. Leaving a peripheral condition behind requires an autonomous development project, conceived from a country’s own internal particularities and invested with a great desire to build something which is truly national. A project of national strengthening which leaves a mass of poor people behind or which results in a social imbalance, such as the one we see in Brazil today due to inequalities, is not possible. Between 2009 and 2010, when I was working at a Chinese University, one of the questions I was most asked as an academic was how to avoid the “Latin Americanisation” of the Chinese society, that is, how to prevent inequalities from becoming an obstacle to the Chinese development, such as what happens in Latin America.

The social-economic formation of modern China, because of its imperial legacy of over two thousand years and the clash with Western and Japanese imperialism, brought enormous clarity for leaders and societies about the need of having an autonomous national project. And the Communist Party of China embodies this: a national development response which synthesizes the legacies of both Chinese civilisation and the historical experience associated with the fight against imperialism. This generates important lessons for other peripheral countries and, alongside the changes in power on a global scale, it results in many implications for future development possibilities of countries such as Brazil.

Interview conducted by: Pedro Steenhagen Translation from Portuguese to English made by: Filipe Porto Date of publication: July 1st, 2021

The opinions expressed in this article do not reflect the institutional position of Observa China 观中国 and are the sole responsibility of the author.