With the rapid rise of a vast country as China, the international order is being shaken. "Will China dominate the 21st Century?" (*) is becoming a favourite debate amongst academics and researchers, as highlighted in a China Daily article of 19 January, 2014. Will Pax Americana give way to Pax Sinica?.
For a start, it may be argued that the world "dominate" seems to have lost significance as the world has become much more diffused, inter-dependent and multi-polar with many more state and non-state actors, as highlighted in recent National Intelligence Council reports. Click here Moreover, the time horizon to the end of the 21st century is too long to make any finite prediction. Many game-changers could happen during such a long time span. Nevertheless, there is reasonable ground to believe that at least by 2050, China is bound to exert a much greater influence in the world compared with the preceding Century largely dominated by the West.
First, China has just surpassed the United States as the world's largest trading nation. According to estimations in July 2008 (based on data from Goldman Sachs), by 2050 China's GDP is likely to become 70-80 % larger than that of the US. According to "China 2030: Building a Modern, Harmonious and Creative Society", a joint report by the World Bank and the Development Research Centre of China's State Council (under ""Global Megatrends", pp.6-7), "even if China's growth rate slows as projected, it would still replace the United States as the largest economy by 2030 ........ Some have argued that by 2030, China’s influence in the global economy could approach that of the United Kingdom in 1870 or the United States in 1945 (Subramanian 2011)". This is essentially a matter of arithmetic. China's population is four times the U.S. So provided China's average productivity exceeds a quarter of the U.S, its economy would be larger than the United States (China Choice, Hugh White, Black Inc, Australia, 2012, "The power of numbers" pp. 28-31).
Second, with a rapidly expanding consumer market, China is likely to remain the world's largest trading and logistical hub, supported by the location on her eastern seaboard of six of the world's busiest container ports with adjacent modern airports linked to the four corners of the globe. These regional transport links will be further enhanced by China's trans-continental rail system (much to be turned into high-speed networks) which connects China’s eastern seaboard across the country to Central Asia, then onwards to Western Europe’s ports such as Rotterdam. These massive rail links are known as Eurasian Land Bridges, the latest to pass through Turkey, some to branch out to the Mekong region and some to North Africa. Added to these is a project for a new and much wider and deeper canal cutting through Nicanagra, expected to be managed by a Chinese firm recently granted a 50-year concession by Nicanagra’s Parliament. This will be capable of accommodating the very large container ships calling at the world's deepest container port, Lianyuangang outside Shanghai. These vessels are simply too large for the Panama Canal, even after its current widening project.
Third, China is likely to step up to the plate of becoming at least one of the world's leading innovators. The World Intellectual Property Organization Report 2012 confirmed, for the first time, China as the world's leading filer of patents, trade marks and industrial designs. Click here The Royal Society in 2013 thought that China's peer-reviewed scientific papers were likely to top the United States in scientific citations in a year or so. The Wall Street Journal of 16 January 2014 featured a report showing how the country has embarked on a "New Era for China's Technology Industry". The drive for innovation will be supported by the dramatic output of university graduates. By 2020, China is expected to have 195 million graduates, more than the entire workforce of the United States at present. It would also benefit from the reform of China’s One Child Policy introduced at the Party’s latest Third Plenum.
Fourth, China is “Going Out” to the rest of the world, with leading footprints in Africa, Latin America, Central Asia, and many other places across the globe through outward investments, mergers and acquisitions, and various other business ventures. This global outreach will be supported by a proposed BRICS development bank, where China's financial muscle is likely to bolster the global influence of the Middle Kingdom. .
Fifth, the RMB is fast becoming fully convertible. It has already eclipsed the US dollar as an ipso facto “reference currency”. More currencies now move in tandem with the RMB than with the dollar, according to Arvind Subramanian of the Petersen Institute for International Economics. Click here Backed by a massive foreign currency reserve, the Chinese yuan is likely to become at least one of the major international reserve currencies. Click here
Sixth, concomitant with a vast economy, China is rapidly modernizing and building up its military, if only to safeguard her vulnerable trading and resource importing sea lanes, including the geopolitically-sensitive East and South China Seas. The country is expected to make up a fleet of five aircraft carrier battle groups by 2050, when China may outspend the United States in military expenditure. See a report in The Economist (The Dragon’s New Teeth, 7 April, 2012).
The Economist (20 November 2013) produces an interactive chart that allows different assumptions for either country on real GDP growth, inflation, and in the case of China, yuan appreciation, whereby the graphs of the two countries's trajectory will be automatically shifted to arrive at a different intersecting point to predict the year when China's economy is expected to overtake the United States. Even using fairly pessimistic assumptions for China (real GDP growth 4%, inflation 3% and yuan appreciation 2%) and quite rosy assumptions for the United States (real GDP growth 3.5% and inflation 1.5%), the predicted date would be 2028. It seems that in all probability, China's economy is reasonably set to overtake the United States by 2030 or thereabouts, at the latest.
However, even if China rises as predicted, given the country’s endowment with more people than resources, especially fresh water, China is likely to struggle in lifting her vast population, a fifth of mankind, to income levels approaching those in advanced countries. By 2050 and further beyond, despite being the world's largest economy, China’s GDP per capita is likely to remain a fraction of that of the United States. Additonally, even as China becomes more innovative, it is questionable whether the country would be able to leapfrog over advanced countries in the number of Nobel laureates in sciences. Moreover, unless the country changes its political spots, most peoples in the world are unlikely to embrace China's political and value systems. It is highly probable, therefore, that the world’s commanding heights in transsformational and cutting-edge technologies, the forefront of innovation, global brands and leading thoughts would remain largely in Western domains, provided that the West will not stay stagnant.
Above all, despite rapid modernization, China’s military technology, outreach, global presence and rapid readiness are still decades behind those of the United States, which, meanwhile, are expected to continue to stay ahead of the times. The overall gap is so wide in many important spheres that by 2050, while China should be able to narrow the gap substantially, the country is unlikely to overtake the United States in comprehensive, global military strength.
So even under the best scenario, China is unlikely to "dominate” the 21st Century. However, provided the country is able to maintain dynamism in face of acute social, economic, ecological and geopolitical constraints, which is by no means a foregone conclusion, by 2050 China is likley to become a leading world power in a class of her own with a much greater influence in the world at least approaching, if not surpassing that of the United States.
If there is any doubt about American primacy or premature visions of China's upcoming gradeur, an Economist Special Report of 23 November 2013 shows that, taking into account America's unrivalled military prowess, predominantly more reliable allies around the globe, and a wealth of cutting-edge talent and innovation, notwithstanding economic success and greater global weight, China is unlikely to be able to tip the balance of American global primacy any time soon.
What this really means is that instead of one single superpower calling the shots, China is likely to gain enough global gravitas to be able to share influence with the United States on "equal terms" (**), standing head and shoulder above other peers, such as the European Union (as a block) and the so-called EAGLES (Emerging and Growth Leading Economies) including India, Brazil, Russia and Indonesia, with whom both the United States and China have to work together in a diffused, multi-polar world.
To understand what a Rising China truly wants and how best to engage her, study the many wise and insight observations aired by Lee Kuan Yew, one of Asia's greatest statesmen, at an interview with The Atlantic on 5 March 2013 here
___________________________________________________________________________
(*) "Will China dominate the 21st Century?" is the title of a much acclaimed book by Jonathan Fenby, which is soon to be released (Polity Press, March 2014)
(**) On Equal Terms - Redefining China's Relationship with America and the West, Zheng Minxun, John Wiley and Sons (Asia) Pte. Ltd., 2011
