With the rapid slump of the Turkish lira, many people think that Turkey's modernization has been hit hard and the country may fall into the middle-income trap and find it hard to get out of it.
What's happening in the Turkish economy is not alone among emerging markets. Similar currency crises occurred in South America, Asia and Russia, showing the vulnerability of emerging markets whose high-speed development also brings serious inflation that imperils them.
In a bid to cement the US' comparative advantage, Washington is unwilling to see smooth development of emerging countries and takes some actions, intentionally or not, to foster the crises that confront the latter. All developing countries have to stay alert to Washington's role. The repeated economic upheaval in emerging countries reflects the twists and turns in their modernization. They have to make more efforts than one might expect in order to change their destiny.
But developing nations don't have to get nervous since nothing will change the overall trend of growing opportunities in globalized times. Their fundamental task is to enhance productivity and expand domestic consumption. As long as these countries pursue overall development, no one can constrain them.
Some Chinese internet users recently compared Turkey to China, suggesting China may be the next Turkey. The lira crisis has alerted most Chinese, which is not a bad thing. But a judgment of the situation must be made objectively, not ideologically. Those who seemingly curse the Chinese economy may be playing an ideological game. It is almost like predicting the US economy will be the next Italy or Spain.
It must be noted that there are more differences than similarities in the Chinese and Turkish economies. Both countries are latecomers to emerging markets and both have experienced an overheated economy. But there's no comparison of their economic scale. China is the world's second largest economy, the largest manufacturing nation and the largest trading nation. It takes much more to carry out an effective assault against China than bring Turkey to its knees.
China has the most competitive real economy in the world as well as the fastest-growing consumer market. It is not reliant on foreign trade as much as other emerging economies and such dependence has been constantly reduced in recent years. China is the world's biggest holder of foreign currency reserve, which can protect China's economic stability. Beijing has been taking a proactive but cautious approach to financial liberalization. When making relevant analyses, China's political system is often mentioned, which is a crucial factor to prevent systematic risks due to its unique management, control and mobilization capabilities.
The Chinese people must be prepared for hardship and crisis, but they must not underestimate their capabilities and scare themselves. They must grasp the rational sense and wisdom to master the subtle differences between them. China is a major country. It will face major risks but it also has great capabilities. It takes courage, confidence and resilience during the process of emergence.