Rise Of China

The incredible ascent of the People’s Republic of China in the late 1900s and early 2000s is like a game-changing moment in global history, much like when the Soviet Union collapsed. Back in 1990, India and China were kinda in the same economic boat, with similar GDPs. Fast forward to today, and China’s economic mojo is on a whole different level, boasting a whopping $14.5 trillion GDP, leaving India’s $3 trillion GDP in the rearview mirror. It’s basically China showing off its rise to the economic stardom stage.

Aspects of China’s Rise

China’s Economic Transformation Before 1979:

Before 1979, China followed a centrally planned economy, investing heavily in industrialization.
Private businesses and foreign investments were restricted, leading to economic imbalances.
Foreign trade was limited to essential goods not produced locally.

Introduction of Economic Reforms:

In 1978, China shifted from Soviet-style policies to market-oriented reforms.
Economic changes included incentives for farmers, creation of special economic zones for foreign investment, and decentralization of economic control to local governments.
Trade barriers were removed, promoting competition and attracting foreign direct investment (FDI).
China’s economy grew significantly faster post-reforms, with an average annual real GDP growth of 9.5% from 1979 to 2018.

China’s International Engagement:

China joined international organizations like the World Bank, IMF, and Asian Development Bank in the 1990s.
Joining the World Trade Organization in 2001 marked a turning point, making China a global leader in goods production and distribution.

Agricultural Reforms:

Post-1976, Deng’s reforms abolished government control over agricultural land, leading to a boom in China’s agricultural sector.
Shift to private farming turned China from a food deficit to surplus, lifting millions out of poverty.

Textile Revolution:

Commercialization of agriculture fueled a textile industry boom in the 1990s, making China the world’s largest cotton producer.
Open-door policies and inexpensive local labor facilitated textile exports, integrating China into the global economy.

Skilling of Labor Force:

Deng’s efforts in the 1980s subsidized education and skill development, leading to a nine-year mandatory schooling period.
Primary education became widespread by 1990, significantly increasing the number of graduates.

Shift to Electronic Goods Manufacturing:

In the early 1990s, China attracted investment from Japanese and South Korean companies facing land and labor shortages.
Special Economic Zones were established to facilitate manufacturing, making China a hub for electronic goods production.

Impact of U.S. Technology Boom:

The late 1990s U.S. tech boom led to manufacturing outsourcing to China, driven by a need for cheap and skilled labor.
China’s ‘Conditional Foreign Investment’ policy encouraged partnerships and technology sharing, enabling local firms to produce advanced-tech products.

Shift to Service Sector:

By the mid-2000s, China’s service industry grew as a result of the booming IT business in the U.S.
Skilled labor contributed to the rise of China’s service industry from 25% in 1975 to 54% in 2019.

2008 Financial Crisis & Aftermath:

Rising labor costs, an aging population, and the 2008 financial crisis impacted China’s economy.
President Xi Jinping initiated the ‘Go Global’ strategy, encouraging enterprises to invest internationally, with the Belt and Road initiative being a visible outcome.

Interpreting the Rise of China

The competing Visions of China’s rise can be interpreted as follows:

A Rising Power in Pursuit of Hegemonic Status and a New Order

Anarchic State of Nature: Many argue that every major power possesses offensive military capabilities, and predicting the future intentions of a state is challenging.

Security Competition Between the U.S. and China: As China continues its impressive economic growth, the U.S. and China are likely to engage in intense security competition, raising the potential for conflict.

Quest for World Power: Great powers generally aim to maximize their global influence and eventually dominate the international system.

USA’s Potential to Counter China’s Influence: The United States has the potential to mitigate China’s growing influence on the world stage.

Threat of China’s Regional Rise: China’s economic strength positions it to potentially achieve hegemony, influencing weaker economies in the Indo-Pacific region through initiatives like the Belt and Road and String of Pearls.

Economic Impact on Sri Lanka: China’s initiatives have visibly impacted Sri Lanka, contributing to the country’s economic crisis.

A New Interconnected and Cooperating World

Responsible Regional Leader: Economists believe that China has the potential to be a responsible global citizen, contributing to world economic stability. It is envisioned to partner with the United States in leading a multilateral system for global governance. This is evident in China’s support for regional economies in Asia through initiatives like providing loans and infrastructure support.

China’s International Engagement: Rather than challenging existing rules and institutions, China has been adept at leveraging them to serve its interests. China collaborates with major powers to address global issues, dispelling concerns about it being a threat. This cooperative approach emphasizes China’s commitment to working within the established international framework.

Increasing Role in Climate Change: China is increasingly aware of the ecological and economic impact of climate change. Establishing committees and programs, such as the National Coordination Committee on Climate Change and the National Climate Change Programme, demonstrates its commitment. China actively participates in international efforts, having ratified key agreements like the UNFCCC and the Kyoto Protocol. This underscores China’s dedication to global environmental responsibility and collaboration.

Nuclear Non-Proliferation: China has embraced and vocalized its support for international non-proliferation efforts. Since 1992, it has signed various arms control agreements, including the Comprehensive Test Ban Treaty and the Nuclear Suppliers Group. By complying with the Missile Technology Control Regime, China affirms its commitment to existing global order and norms, contributing to a safer world.

Conclusion

There’s a noticeable shift in global dynamics as the influence of the United States undergoes changes. China’s remarkable rise signals the emergence of a formidable peer competitor, and it’s on track to surpass the United States as the world’s largest economy.
While China’s ascent was initially subtle, it has evolved into a more assertive player on the international stage. This is particularly evident in its stance on territorial disputes in the South China Sea, reflecting a shift from a “quiet rise” to vocal expressions of great power aspirations.
China’s economic strength now comes hand-in-hand with a more robust military modernization program. This development serves as a clear signal to Asia and the United States that China’s growing economic power will have significant geopolitical implications.
The global impact of the COVID-19 pandemic has presented new opportunities for China to expand its influence. However, this has also raised questions about China’s credibility as a responsible global player and has cast doubt on the sustainability of the supply chains that have contributed to its economic success.

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