Relative to its supposed promise, the Great Leap Forward now looks to have been a touch oxymoronic while the Cultural Revolution now seems to have been more a Cultural Regression.Over the last 20 years, China's arrival on the global economic stage has been greeted with considerable fanfare and, at the same time, with growing trepidation. If the first major act of sustained modern economic development - the industrial revolution - left China on the sidelines, exploited (and drugged) by Western colonisers in the 19th century, and the second act - post-war economic catch-up for many European countries and Japan - left China sulking without a role, the third act has been marked by a barnstorming performance from the Middle Kingdom. Yet they both recognise, despite their mutual antipathy, that they are better off, economically, working together. Until Deng Xiaoping's ascendancy, China was, compared with Japan, an economic pygmy. If one country's policymakers understand China's economic impact better than others, it's Japan's. Next-door neighbours who aren't always in the mood to pop around for a natter, Japan and China have had, over the years, a relationship that has been at best a little frosty and at worst ...
well, let's just say that they haven't always been on speaking terms. It also proposed affordable measures to promote enterprise and innovation that the Chancellor could introduce as early as next year.. I spent last week travelling around Asia. Apart from the - entirely predictable - obsession with US monetary policy, the other main topics of interest were China's impact on the rest of the world and Japan's signs of economic recovery Oddly enough, these two topics are related. Mr McCafferty, said: "There must be absolutely no further increases in the tax or regulatory burden on companies. If the Government truly recognises the fundamental role business plays in generating wealth for the nation, it must put previous increases into reverse before the end of this Parliament."It called on ministers to press on with corporation tax reform, and strongly criticised tax measures being introduced under an "anti-avoidance" banner by the Treasury. He said: "We have sufficient confidence that in all the areas progress can be made.
Too much of the growth in public spending and extra taxes that businesses have provided have gone on wage growth that has not delivered a competitive advantage."He added: "If the private sector can keep to 4.5 per cent pay growth there's no good reason why government cannot move back to 4.5 per cent."Spending commitments vital for the economy's long-term prospects - on education and skills, transport, science, technology and innovation, and support services for trade and businesses - should be protected.Looking ahead, the CBI called for the £50bn increases in overall business taxation to be put into reverse, with a cut in the tax burden before 2010. It warned that unless this was tackled in the next two years then Chancellor Gordon Brown would risk breaking his "golden rule" to balance the books over the coming economic cycle. Asked what the CBI's reaction would be if the Government failed to respond, Mr Cridland said: "This is big. If we don't get the signal we are looking for, you will see the response that you would expect."The CBI said the growth in total spending should be constrained over the next two years to £51.4bn - a 10 per cent rise - rather than the £61.4bn or 12 per cent laid out in the March Budget. "We are talking about constraining future growth in public spending, not cuts in public spending," Mr Cridland said.In its proposal, the CBI said the £10bn savings could be found from a £6bn reduction in Whitehall's pay bill by holding average annual pay growth to 4.5 per cent, and shaving the public sector headcount by 1.25 per cent to match rates of absenteeism; £2.5bn saved from the benefits bill through action to reduce fraud and error; and £1.5bn by simply leaving unspent the "resource budget reserve".Ian McCafferty, the CBI's chief economic adviser, denied that its proposals, which were based on targets for reducing future spending rather than axing named programmes, were "flaky". He stands to make up to £9m if the E.ON deal goes through.ScottishPower is being advised by Morgan Stanley and UBS while E.ON has retained Lazards.