China, officially the People’s Republic of China, is the second largest economy in the world and the fastest growing trillion-dollar economy. With a GDP of $15 trillion plus in 2020, it makes up almost 20 per cent of the global economy. When compared on the basis of Purchasing Power Parity (PPP), China is the largest economy with a GDP of $27 trillion plus. At present, the size of China’s nominal GDP is lesser than that of the US but China is on the path to become a $20 trillion economy by 2024 superseding the US.
Since 1949 till today, China has been ruled by honest, efficient and effective leadership. Among these, Mao Tsetung, Zhou Enlai, Deng Xiaoping are the most prominent leaders of China. Currently, Xi Jinping is spearheading China towards economic supremacy. Xi was elected President of China on 14th March 2012. He has brought massive changes in China’s traditional economic and political policies. He has overhauled the Chinese economy on technical grounds. Moreover, he has interlinked China with the rest of the world which is making it more politically and economically powerful culminating it into a major economic clout. The influence of Chinese global leadership rests on the following four premises:
- Military hard power that can be projected in the South & East China Seas and potentially beyond
- Continued economic growth above 5% and advances across 4th industrial revolution technologies
- Other forms of coercive power – debt leverage, Belt and Road Initiative (BRI), disinformation, cyber infiltration and intellectual property theft, regime capture and biological warfare etc.
- Ability to influence global institutions, standards and norms of behavior in line with preferences
Based on the above, some of the key features of how the geopolitical order will look in the 2030 are as follows:
- The relative influence of the US and China and their interaction would play a dominant role in defining the international landscape in key regions around the world after the pandemic. The relative recovery of both countries from COVID-19 and the degree of their weakening or strengthening as a result will play a significant role in shaping the future geopolitical landscape.
- Under no scenario, cooperation or positivity is expected under US-China relationship, though cooperation is possible on select areas of shared global interests where US power and influence equaled or was greater than that of China.
- The US could find sustained advantage in shaping the behavior of China through its allied partners (Japan, Australia, UK, India) but only when it was willing to engage multilaterally and when other nations made cost-benefit analysis that supporting a world under greater US leadership would be preferable to a China led or non-aligned order. US alliances are more stable in the Europe than Asia or Middle East where dynamics of geopolitics are more complex.
- The most likely outcome for world order in the decade ahead would not be a unipolar order or bi-polar Cold War style competition but a loose multipolarity. Under any outcome, the relative strength of both the US and China would be diluted or balanced by the influence of independent security and foreign policies of India, Japan, Germany, France, UK and others.
- Nefarious behaviour of ‘spoiler’ nations like Russia, North Korea and Iran also needs to be taken into account.
Lessons from Chinese growth model
During last three decades, China has become a major factor in shaping global political order. China is now the second largest economy, largest trading nation and holder of largest foreign currency reserve over USD 3 trillion. This is a giant leap from 1976 when one-third of enterprises in China were booking losses, nation’s trade was just USD 13.4 billion and its foreign exchange reserves were USD 580 million. Today, Chinese exports of one day equal its entire exports for the year 1978.
China’s miracle is not just the difference in national economic figures of the last forty years but the fact that this transformation has been achieved without altering the country’s political system which remains centralised under the Communist Party of China (CPC). In China, Marxist-Leninist political philosophy and capitalist business models seem to be complementary. The key to understanding the Chinese miracle is finding how the Communist leadership has created a system that harmonizes Marxism and Leninism with the economic models put forth by Adam Smith and Keynes.
Henceforth, Chinese economic miracle inspires many developing countries to adopt similar policies and approaches. Notwithstanding the inimitability of China’s model, developing countries like Pakistan can draw critical lessons from China in reforms and governance to optimise their own pursuits of national economic and social development.