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SARS Has Political And Economic Implications in China
Aired April 21, 2003 - 15:21 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JUDY WOODRUFF, CNN ANCHOR: Well, the financial slowdown caused by SARS could infect economies throughout Asia and beyond -- as we reported. The virus has already caused political changes inside China.
With me now to talk more about all these issues is Mark Fung. He is with the School of Advanced International Studies at Johns Hopkins University.
Let's talk the economy first. How serious a problem could this be for the Chinese economy and other Asian economies?
MARK FUNG, SCHOOL OF ADVANCED INTERNATIONAL STUDIES, JOHNS HOPKINS UNIVERSITY: I think you have to look at it in the longer term. And right now, it's very serious for two reasons.
Number one. China is depending on a 7 to 8 percent growth rate per year to maintain social stability. That's the conventional wisdom. This could potentially shave off 1 percent of its growth.
WOODRUFF: Worth a lot of money?
FUNG: Exactly. Plus, it's the number one recipient of foreign direct investment, so I think this will have a direct impact in the longer term.
WOODRUFF: What about Chinese -- in China, in political terms -- you have the mayor of Beijing, a top health official both sacked because they weren't telling the whole story about SARS. Now, the Chinese seem to be trying to get all that information out there. Is this becoming -- going from a health crisis to a political crisis as well in China?
I think you hit the nail on the head -- exactly. But to understand this predicament, you have to understand Chinese political culture, which is really steeped in this confucion -- bureaucratic order -- which is your loyalty flows to your superior, not to the institution or to the people you serve. So clearly, this is something that the central leadership wants to clamp down, but it's too little too late, really.
WOODRUFF: So what can the Chinese do at this point? Do they now have the credibility to deal with this and move forward?
FUNG: I think they're trying to build the credibility, but now, once the credibility has been shot, it's going to take a long time for them to regain that. And I think particularly, you have three issues that were on the minds of the leadership. You had, number one, a transition that wasn't overnight. You had a transition that's starting in October that went through March. And during this time, it just definitely did not hit the radar screens, and I think the senior officials could care less about this at that point.
WOODRUFF: And you think they've salvaged it now, to some extent?
FUNG: I think they're trying to fish it out of the oceans somewhat.
WOODRUFF: It's still a problem.
All right, Mark Fung with the School of Advanced International Studies at Johns Hopkins. Good to see you.
FUNG: Thank you, Judy.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired April 21, 2003 - 15:21 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JUDY WOODRUFF, CNN ANCHOR: Well, the financial slowdown caused by SARS could infect economies throughout Asia and beyond -- as we reported. The virus has already caused political changes inside China.
With me now to talk more about all these issues is Mark Fung. He is with the School of Advanced International Studies at Johns Hopkins University.
Let's talk the economy first. How serious a problem could this be for the Chinese economy and other Asian economies?
MARK FUNG, SCHOOL OF ADVANCED INTERNATIONAL STUDIES, JOHNS HOPKINS UNIVERSITY: I think you have to look at it in the longer term. And right now, it's very serious for two reasons.
Number one. China is depending on a 7 to 8 percent growth rate per year to maintain social stability. That's the conventional wisdom. This could potentially shave off 1 percent of its growth.
WOODRUFF: Worth a lot of money?
FUNG: Exactly. Plus, it's the number one recipient of foreign direct investment, so I think this will have a direct impact in the longer term.
WOODRUFF: What about Chinese -- in China, in political terms -- you have the mayor of Beijing, a top health official both sacked because they weren't telling the whole story about SARS. Now, the Chinese seem to be trying to get all that information out there. Is this becoming -- going from a health crisis to a political crisis as well in China?
I think you hit the nail on the head -- exactly. But to understand this predicament, you have to understand Chinese political culture, which is really steeped in this confucion -- bureaucratic order -- which is your loyalty flows to your superior, not to the institution or to the people you serve. So clearly, this is something that the central leadership wants to clamp down, but it's too little too late, really.
WOODRUFF: So what can the Chinese do at this point? Do they now have the credibility to deal with this and move forward?
FUNG: I think they're trying to build the credibility, but now, once the credibility has been shot, it's going to take a long time for them to regain that. And I think particularly, you have three issues that were on the minds of the leadership. You had, number one, a transition that wasn't overnight. You had a transition that's starting in October that went through March. And during this time, it just definitely did not hit the radar screens, and I think the senior officials could care less about this at that point.
WOODRUFF: And you think they've salvaged it now, to some extent?
FUNG: I think they're trying to fish it out of the oceans somewhat.
WOODRUFF: It's still a problem.
All right, Mark Fung with the School of Advanced International Studies at Johns Hopkins. Good to see you.
FUNG: Thank you, Judy.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
