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UPDATED: August 30, 2014 NO. 36 SEPTEMBER 4, 2014
Deng Xiaoping: Economist, Diplomat, Reformer
By Kerry Brown

China has risen to become the world's second largest economy, largest exporter, second largest importer, and largest holder of foreign reserves by building on the reform template put in place by Deng. Deng is the father of an urbanizing, modernizing, global China. His name will be associated with this achievement, which has been described by some as one of the most important human successes of the last century. His strategy lifted as many as 300 million out of poverty, and created the levels of prosperity across China that we see now.

While Deng's role as economist is widely appreciated, there is little doubt that his achievements in this area would not have been effective if he had not secured diplomatic stability. The reform process was dependent on harmonious relations with neighboring countries, and with major partners like the United States and Europe. Deng's own visit to the United States, after full diplomatic recognition was extended in 1979, was a groundbreaking diplomatic mission. He also visited Japan and encouraged other colleagues to look in detail at the industrial and technological models being used in countries as far away as the UK, Australia, New Zealand, and Canada. This reset China's global role, making it less and less isolated and more influential in global affairs.

Deng was able to provide the framework to manage Hong Kong's return to China. This will no doubt be regarded as his main achievement in this realm. But creating an ethos within China where positive relations with the rest of the world were the norm, rather than the exception, and where a genteel, peaceful international atmosphere was regarded as integral to China's aspiration to grow and prosper, was an integral part of the context that made domestic economic reforms possible.

A dynamic process

The attitude toward reform and the placing of it at the heart of government policy remain immensely important in China 17 years after his death. During his celebrated southern tour in 1992, Deng stated the choice starkly: reform or perdition. At times in which China's commitment to reform has been questioned or under attack, Deng's influence has been a great asset. This remains the case for the current leadership.

But reform is a dynamic process, and no one, least of all Deng, would have believed that there was an easy end point to it. In that sense, he set a very flexible framework, one within which future leaders could have quite wide discretion. The challenges that China faces today are very different from those of 1978. Then, the key mission was building prosperity through modernization and industrialization. Unleashing productivity in the economy by reforms in the agricultural sector and a commitment to the "four modernizations"—the reshaping of agriculture, industry, national defense and science and technology—were key.

In 2014, these core areas are different. Building an economy where there is a domestic finance sector, a higher services proportion as part of GDP and more consumption, and accelerating urbanization are now vital, with the enormous challenge of sustainability looming over this.

Premier Li Keqiang has talked of the core mission being to deliver "fast, sustainable growth." The focus of reform in China since the Third Plenary Session of the 18th CPC Central Committee in late 2013 has been to set out the right reformist framework in which this can occur. Some measures involve social changes like delivering a higher level of welfare and equality and increasing efficiency in the realms of governance and the economy. Others involve creating a more innovative, higher value-added industrial and entrepreneurial model. The efficient use of capital and the construction of a better tax base are two of the many key elements of this new era of reforms.

While very different from the issues of China over three decades ago, these current challenges are part of the same spectrum of change and development launched in 1978. In that sense, Deng's influence remains strong, despite the transition that China is making toward a new phase of its growth and development. The vehicle is very different these days, but it runs on the same broad tracks that Deng set for it.

The author is an op-ed contributor to Beijing Review and executive director of the China Studies Center at the University of Sydney

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