Dear friends of the IFRTT,
As I am sure of, most readers are aware of that China has just ended its 19th Communist Party Congress. China watchers as well as Chinese friends are still busy analysing what the speeches and statements made
will mean for business going forward.
Let me give my take on what it means for our industry both based on the 19th Party Congress. To do that we need to understand the philosophical background to the thought of Xi Jinping, which today may seem
quite abstract to most Western readers.
Mr Xi is trained in the Hegel philosophy of Dialectics, developed into material dialectics by Marx and Engels, which talks about the dynamic of the contradictions of society. Only by identifying the contradictions correctly
can society make progress. In his opening address at the 19th Party Congress he identified the, so called, new contradiction: It is now between people’s growing demand for a good life with the country’s unbalanced and insufficient development. In
other words, society is not geared toward meeting the demands of the rising middle class.
The middle class in China is demanding the same things as any middle class: safe food, a clean environment, good education for its children, elderly care for its parents, social safety systems etc. In his speech the word
“environment” was mentioned more times than economic reform. This is a reflection of that the Party takes the quality of life in China very seriously.
Actually, already 5 years ago, when newly elected, President Xi launched the term the “Beautiful China”, which refers to a liveable China for its population. In this year’s party congress opening address the word “green”
was mentioned fifteen times and Mr Xi referred to treating the environment the same way as you treat your own body. There is a clear shift from the old development model based on wild, unregulated growth to the pursuit of quality of life of the individual.
It is also emphasized that sustainable development can only be pursued with the help of strictly enforced rules and regulations.
For our industry it means that the push for implementing the revised masses and dimensions standard will continue and we are now, a bit more than a year since its launch, seeing substantial improvements of the specifications
of heavy commercial vehicles used in China. China is reining in overloading and oversized vehicles. This is not only good for level playing field competition, but it is also good for road traffic safety.
From July 1st this year China has introduced the Chinese equivalent of Euro5 emissions and will take the leap to the Euro6 equivalent within a few years. Transports are thus becoming safer and cleaner. This
coupled with an ambition to pave the regulatory way for long vehicle combinations (high capacity vehicles) means that transports will also become more efficient. There is a good momentum in swing that we will help enforce.
In China one of the new buzzwords is now “the New Era”. China has set the target to become a basically modernized country by 2030 and to be a powerful socialist country by 2050. To do that the market forces, checked by
good and enforced regulation will have to play their role. However, for a country where the legislators have their background and training in the old, redundant development model, the drafting of new modern legislation conducive to the needs of the New Era,
poses quite a challenge. Therefore it is now more important than ever for western industry and governments to assist in a multi-stakeholder approach to the drafting process.
This is also why there is a great interest from the transport authorities in China to tap deeper into the knowledge and experience of the IFRTT community. As partners to China in this process our role is not only to provide
facts and figures, but even more importantly to explain the principles behind the regulation that we, ourselves, have drafted and put in place. The importance of that pedagogical aspect of the regulatory dialogues cannot be emphasized enough. We can assist
in creating regulations that are conducive to fair competition and sustainable growth, which also will benefit the ability of foreign companies to compete in China.
An example of bad regulation is the new compulsory frame-standard revision for motor vehicles that has just been revised in the so called GB7258 issued by the ministry of Public Security. It covers all safety aspects
of on-road motor vehicles, but in my very personal view it does not properly define the purpose and the principles behind this standard. Therefore it has taken on a too comprehensive shape covering areas that normally would be far outside of the scope and
responsibility of road traffic safety authorities. For the next revision of this standard I hope that we shall have had ample time to engage much deeper in the principles, before discussing the details of the standard.
Finally, a note about the weather. As winter approaches the cold dry winds from Siberia wrestle with the warm humid winds from the Pacific Ocean. As I write this letter, the Pacific Ocean is stronger than Siberia and
we are enjoying a mild, November day with blue skies and trees that are sparkling in all the beautiful autumn colours. Soon, however, the cold and dry winds will again sweep down over China and a permanent high pressure system will be parked over Siberia,
which will result in a constant freezing northerly wind. It is because of that phenomena that all traditional Chinese courtyards face south with a windowless massive brick wall facing north as protection against that bone chilling wind.
My office window is on the 20th floor facing northwest. On a clear sky we can see the mountains surrounding Beijing, but as Beijing real estate develops extremely fast new high rise buildings are shooting up
like mushrooms. Sadly, soon a massive wall of concrete will be obscuring our view of the mountains, but the consoling thing is that, at least, it will protect our office from the cold Siberian winds….
Kind Regards,
Mats Harborn
IFRTT Vice President for Asia