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The ESADE Alumni China Business Club recently hosted the presentation of Eugeni Bregolat's book "China's Second Revolution". Mr. Bregolat was the Spanish Ambassador to China from 1985 to 1991 and from 1999 to 2003. His new book covers the last 30 years of China's history, during which time the country has opened up to the outside world and seen spectacular economic growth.

At the presentation of his new book, La segunda revolución china, Eugeni Bregolat reached the following conclusion: China is already the world's factory, but it also aspires to be the world's research and development centre. He also discussed how political opening and economic development have changed Chinese society and politics.

Mr. Bregolat explained that, according to the OECD, "China is now the world?s second largest investor in R&D. In 2006, it surpassed Japan and the European Union, and now only trails the United States". While acknowledging that "figures involving China are always questionable", the former ambassador explained that China "does not want to miss the boat to the digital era like it did with the industrial revolution, which led to a century of submission to foreign powers".

China's obsession with innovation dates back to 1997, when Deng Xiaoping identified technology as one of the pillars of economic growth. Mr. Bregolat recognised that "for now, technology is controlled by foreign multinationals, but Chinese R&D firms are gaining influence in the world market". He added, however, that "China has come a long way in the past 30 years".

Mr. Bregolat then discussed the country's enormous advances in transportation-related sectors (aircraft, trains, automobiles, etc.), with special emphasis on "China's space programme and its efforts to develop its own navigation system as an alternative to GPS and Galileo".

According to Mr. Bregolat, faced with this eagerness for technological development, "Spain and the rest of the West don't realise the magnitude of the challenge". The key to facing this challenge, he said, is to "boost R&D and avoid slipping into the protectionist mindset that is so tempting for the EU and the US".
Mr. Bregolat then highlighted the links between China and Spain: "One seventh of our exports go to China". He added, however, that "the number of Spanish companies in China is very small, around 500. To sell in China, you have to be in China. Just 0.37% of all foreign investment in China comes from Spain. This is a strategic error". He cited the major investments of BBVA and Telefónica, saying they "could mark an inflection point".

In the second half of his presentation, Mr. Bregolat analysed the changes brought about by China's economic development. First, he discussed the "emergence of new social classes such as the bourgeoisie, which has become richer as the country has opened up, and the middle classes, which have purchasing power and are concentrated in the coastal cities". He then explained that the theoretical Communism of the ruling party is gradually disappearing: "Today, only a third of the companies in the secondary and tertiary sectors are state-owned". Such figures, he said, have never before been seen in a supposedly socialist country.

Mr. Bregolat explained that, due to the Internet boom, the regime is no longer capable of iron-fisted rule. Despite the regime's attempts to control it, the spread of the Internet has created some contradictions within the Communist Party. Nevertheless, as Mr. Bregolat noted, "China's leaders prefer to accept the existence of the Internet and have a modern country, despite the risk of political change, rather than being stuck in the 19th century".

Toward the end of his presentation, Mr. Bregolat pointed out that "China's economic development has afforded a degree of legitimacy to the Party, but it has also eroded its power". He added: "China is laying the groundwork for a democratic future. Regression is absolutely impossible". Finally, he concluded: "No one can see the future, but I think that there will be an evolution within the system. The Chinese are very pragmatic; they know that at some point they will have to change".



Programme
Few people have observed Chinese society from such a privileged position as Eugeni Bregolat. Based on his 10 years as Spanish Ambassador to China, this book analyses watershed events such as the Tiananmen Square protests, as well as the country's political opening, economic reforms and exponential growth. In the book, Mr. Bregolat describes these events, as well as the spectacular rebirth of a highly complex society destined, in the coming years, to play a decisive role in the world order.

Eugeni Bregolat Obiols (La Seu d'Urgell, Lleida, 26th January 1943) has served as Spanish Ambassador to Indonesia (1982-85), China (1985-91), Canada (1991-92), Russia (1992-97), again to China (1999-2003), and now to Andorra. Based on his experience as Ambassador to China in the second half of the 1980s and again in the late 1990s, his book offers the keys to understanding the political, economic and social landscape of modern-day China.

Introduction:
Yingying Zhang, Vice President of the ESADE Alumni China Business Club
 
Book summary:
Ivana Casaburi, Associate Professor in the Department of Marketing Management at ESADE
 
Lecture on the social and political economy of China:
Eugeni Bregolat

Appetizers will be served after the presentation.

Date, time and venue:
Thursday, 14th June 2007
7.00 pm
ESADE - ESADEFORUM
Av. Pedralbes, 60-62
Barcelona

For more information:
ESADE Alumni
Tel: 902 420 020