The lack of trade union rights and proper democracy were holding back China's economic progress, a leading economist from Shanghai told a conference in University College Dublin yesterday.
But Prof Jianmao Wang told the second Euro-China Forum at UCD's Smurfit School of Business that he was cautiously optimistic about China's economic future.
Prof Wang, from the China-Europe International Business School (CEIBS) in Shanghai, said that 25 years ago China was a closed country, with very little freedom.
He added: "Today China is a partially open country with mixed ownership, a heavily regulated and underdeveloped market economy and some freedom."
China's "long march" to the market economy was only at the halfway stage. The government usually held the majority of shares in listed companies. There was poor protection of the rights of investors.
"Many enterprises do not have a union, and even if they have a union, [to] strike is illegal in China, and collective bargaining is almost non-existent. So it is not much use [to have] a union."
The new generation of leadership in China wanted to balance efficiency with equity, he said. "China may be a market economy, but a crony capitalist one where corruption is institutionalised and stealing is the only way to get rich. China may be a democracy, but a democracy manipulated by vested interests, so basically no good."
He concluded on a note of cautious optimism based on the success of reform in the last 25 years and the fact that urbanisation could generate huge demand and sustain another 25 years of high-speed growth.
Prof Liu Ji, executive president of the CEIBS in Shanghai, said China was a developing country with a huge landmass and a population of 1.3 billion. "Both the economic reform and the more complicated political reform are expected to take a long time," he said.
He continued: "If we were to move ahead recklessly it could lead to trouble and turmoil, which would disturb the steady and peaceful life of our large population.
At the same time this principle cannot be used to justify the argument that we should remain stagnant, or delay the reforms."
Reviewing progress over the past 20 years, he said the liberty of the press and publishing houses in China was now "much less constrained and manipulated".
He claimed the Chinese people were "enjoying an unprecedented degree of freedom, since their speeches are always tolerated, provided that they are not aimed at toppling the government or destroying social order".
Ms Henriette Geiger, a China specialist with the European Commission, said it would be important for member-states to co-ordinate their policies towards China as much as possible, "so that the EU speaks with a single voice on all key issues of China policy".
The Minister of State for European Affairs, Mr Dick Roche said that, as EU-China trade and political links intensified, the EU and China were becoming ever-closer partners.
Speaking from the floor, Mr Brian Callanan of the employers' group, IBEC, said Irish companies, for example, in the spirits and pigmeat sectors, had found it "extraordinarily difficult" to start doing business with China because of the proliferation of red tape.
