PHUMLANI M. MAJOZI

Home » Politics and economics » Why the 21st century “might not” belong to China

Why the 21st century “might not” belong to China

6fee4-china-economychart-2006

JOHANNESBURG, SOUTH AFRICA

THE EXTRAORDINARY RISE OF CHINA WILL always remain one of the great stories of the late 20th and early 21stcentury. China’s rise to riches can largely be attributed to the pro-market economic reforms that were adopted by Deng Xiaoping in the late 1970s.

Xiaoping’s reforms were called “Socialism with Chinese characteristics”.  I wonder why they used this term though. They may well have chosen, “Socialism with free market characteristics”. Because increasingly, their economic reforms have included elements of free-market policies.

The reforms included de-collectivization of agriculture, free trade, privatization, deregulation, etc. From then, till today, the Chinese economy has grown at extraordinary rates – in 1993 China’s gross domestic product grew by a staggering 14.0%. The nation is the world’s second largest economy, world’s biggest car market, accounts for around half of East Asia’s GDP – a powerful force behind the rise of the East.

Even the Chinese military is gaining strength day by day. In science, the Chinese are currently working on their space station which should be operational by 2020.

Given all the Chinese accomplishments we’ve seen in the past 30 years, will the 21st century belong to China? It’s a question many people already have an answer to.

They might be the largest economy in the world if their growth rate continuously remains above 7%, but the century won’t belong to them, because of cultural and political reasons. Some global thinkers say it takes more than the largest economy to be the world’s superpower. I agree with their view.

China is a great country yes, but as long as their economy is driven by exports, they’ll endure predicaments. As we speak, their growth has plummeted because of the world’s stuttering economy.

Exports and their devalued currency have left them surpluses for years. But this exports-driven economy will never be stable, and requires that the Chinese focus on bolstering domestic demand.

We shouldn’t forget that it was once predicted that Japan would be the largest economy in the world by 2000 – that didn’t happen. Rather, Japan declined into an economic quagmire in the 1990s.

My point is that the Chinese rise cannot be a forgone conclusion and they’ll face many challenges that could quell their growth.

In India, the other large and fast-growing economy in the East, investments have dried up and the rupee has plunged dramatically. What we are witnessing with India shows that anything can happen. We cannot be certain that China will maintain its growth rate in years to come. This is the reason I say China “may be”, the largest economy in the world in eleven years from now.

As a model that can be adopted by the world, the Chinese are not even close. They don’t want to embrace the global culture. China hasn’t really got into people’s hearts.

Even though they’ve taken an initiative to produce their own films, and of course censor any imported, Hollywood movies continue to top the box office even inside China.

Last year, the Chinese government shut down numerous American shows, owing to fears that the youth is becoming westernized. Such things will constrain China’s progress. A nation seeking to be a superpower needs to embrace the world and not be radically nationalist.

Geopolitical tensions in East Asia also concern me. Instead of establishing allies in the region, China has tussled with most of its neighbors.

The on-going territorial disputes in East Asia on Diaoyu/Senkaku with Japan confirm this. Apart from that dispute, China is also in disputes with Vietnam, the Philippines, Malaysia and Brunei. How will they bolster their economy and their global image if they are in tussles with their neighbors?

The ability to unite the region and set the agenda is very important. Diplomatic efforts to solve these tensions need to be undertaken. But in parallel to that, the Chinese must protect Japan’s assets and consulates based in Beijing, and the Japanese should do the same in Tokyo. It must do the same for other neighbors as well.

Malcolm Moore of the Telegraph said that we shouldn’t expect significant resolutions between China and Japan anytime soon because of the imminent change in leadership, with neither wanting to look weak.

Today, the fact is that most Asians are anxious about China. Outside of Asia, the U.S. Republican presidential candidate, Mitt Romney, has vowed to take on the Chinese should he be elected into the Oval office – labelling them the “currency manipulator”.

In Zambia, Rupiah Banda lost the election partly because he kissed and made up with the Chinese. There will always be an appetite for an alternative to China.

I do believe the Chinese have entered the world stage. There are some problems though, as I’ve mentioned above that will challenge them. So far they haven’t exercised their power where need be. Instead, they’ve become nationalist, merely forwarding their interests and therefore failing to realize how interconnected the world has become – this I believe will hit them very badly.

So, will the century belong to China? I say no. Then to whom will it belong to? Let’s leave that for another day. PM

© PHUMLANI M. MAJOZI


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