Will China Dominate the 21st Century?

Jonathan Fenby

• Publisher: Polity
• Year: 2017
• ISBN:
  9781509511006
• Edition: 2
• Topic: Política y relaciones internacionales
• Subtopic: Comercio y aranceles

China's spectacular growth and expanding global role have led to visions of the 21st century being dominated by the last major state on earth ruled by a Communist Party. In this new edition of his widely acclaimed book, renowned China expert Jonathan Fenby shows why such assumptions are wrong. He presents an analysis of China under Xi Jinping which explores the highly significant political, economic, social and international challenges it faces, each involving structural difficulties that will put the system under strain.

Based on the author's extensive knowledge of contemporary China and his close analysis of Xi's leadership, this incisive book offers a pragmatic view of where the country is heading at a time when its future is too important an issue for wishful theorizing.

1
The China Dream

With an economy set to be the biggest on earth in a few years, the world’s largest population, an expanding global presence, a modernizing military and an assertively nationalistic one-party regime, China may well seem bound to dominate the present century. Stretching across 3.7 million square miles (99.6 million square kilometres) from the East China Sea to Central Asia, from the Siberian border to the semi-tropical south-west, it has become a major motor of international production and commerce, with an ever-increasingly international political presence as the main beneficiary of globalization.

Rich in people but poor in resources, its high level of demand is the main force in the global trade in commodities, ranging from iron ore to peanuts, determining the fortunes of countries in Africa, Australia, Brazil and elsewhere in Asia. The speed and scale of its material renaissance are unequalled. Annual real growth has been above 8 per cent in all but eight of the past 35 years; when it dropped below that level in 2015–16, it was still far greater than that of other major nations.

Four decades ago, the People’s Republic of China (PRC) was heading for basket-case status at the end of the Mao Zedong era; now it breeds superlatives and world leaders beat a path to its door. Everything seems bigger in the one-time Middle Kingdom than anywhere else – from mega-cities and super computers to its space programmes and even the huge industry in counterfeit goods and the online trolls who post half-a-billion fake social media messages each year. Though 150 million people still lived on less than $2 a day by the World Bank’s measurement in 2010, another 600 million had lifted themselves out of poverty in the first three decades of growth. The most extensive infrastructure development ever seen, which was ratcheted up by the huge stimulus programme launched at the end of 2008, has included laying the longest high-speed rail network in record time, constructing the enormous Three Gorges Dam on the Yangtze River and threading the country with airports, multi-lane highways and soaring bridges.¹

After centuries of semi-seclusion and isolation from the main global currents under Mao, China now bestrides the world stage; its leader, Xi Jinping, made 14 state visits in 2015. The PRC disburses hundreds of billions of dollars in aid and investment around the globe and has taken initiatives designed to rival the (US) dollar-led post-1945 global order as it pursues what its President dubs the ‘China Dream’ of national rejuvenation and world respect.

While the United States frets about maintaining its world role, China exhibits no such doubts and sees itself moving into the vacuum as Pax Sinica succeeds Pax Americana. As a global superpower, the PRC holds a permanent seat on the United Nations (UN) Security Council and possesses nuclear arms. Its currency is widely used in global commerce; the International Monetary Fund (IMF) took the renminbi into its Special Drawing Rights (SDR) system in 2016. It is the economic leader among developing nations, the cornerstone of the BRICS grouping (Brazil, Russia, India, China and South Africa) and the moving force behind the new Asian Infrastructure Investment Bank (AIIB). It plans to breathe life into a new version of the Silk Road with assistance totalling tens of billions of dollars. It has the largest standing army on earth and is the biggest contributor of troops to UN peace-keeping forces. An array of foreign nations, from Britain to Uzbekistan, are anxious for its favours, as they showed in 2015 by resisting US advice not to join the AIIB.

China’s performance since Mao’s successor, Deng Xiaoping, unleashed economic expansion and connected his country with the world has led to widespread forecasts that the PRC will, according to one book title, ‘rule the world’ as the influence of the last major Communist Leninist state takes over from the West and the globe ‘becomes more Chinese’. What has been achieved since the late 1970s is taken to mean that the 21st century must belong to the People’s Republic since, in the words of the historian Niall Ferguson in 2011, ‘for the next 10 or 20 years it is going to be very hard to derail China’s economic locomotive’. Its history and civilization are held to give it advantages which the West cannot match. It is said to be run by a uniquely capable meritocracy that provides wise, long-term rule which eludes messy democratic governments.²

This book posits, on the contrary, that, spectacular as its growth and emergence on to the world stage have been, the PRC is hidebound by a set of factors which will limit its progress, some new and some reaching back into the distant past. This is not to say, however, that China will implode – forecasts of its coming collapse voiced since the start of this century have proved wrong and will continue to be mistaken. The country has too many assets and too much remaining potential for growth for that to happen. Its ruling caste will use everything at its disposal to ward off trouble and maintain its supremacy – a short-term defensive attitude which is at the root of many of the difficulties surrounding the Xi administration.

Rather than ruling the world or collapsing, the PRC will be caught in the limitations of its one-party system and the power apparatus on which the regime is founded. Attention is usually focused on the economy, with the perpetuation of the monopoly Party State which has ruled since the Communists won the civil war against the Kuomintang Nationalists in 1949 taken as a given. But it is the politics of China that are the determining factor, as they have been throughout its history.

Today, the confines of the political system and the over-riding need of the leaders to cling on to power on behalf of the Communist Party make it virtually impossible for them to address adequately the array of challenges before them, many the result of politically motivated mismanagement of the growth process that so impresses the world. They know that the era of turbo-charged growth is past: most observers doubt the official growth figures for 2015–16, referred to above, which show annual expansion slowing to 6.5–7 per cent, believing that the true figure is even lower. What counts is the leadership’s ability to manage that decline in an increasingly challenging international context of contracting global commerce. This will involve political choices, and all the signs are that these will be constrained by the power imperatives driving Xi Jinping and his administration.

As a result, the outcome is likely to be summed up in a phrase not usually associated with the PRC: ‘muddling through’. This conclusion will disappoint those who seek a sharp, headline-grabbing vision of the future. But it is set to be the reality as the conflicting priorities of Xi and his colleagues inhibit them. As a result, rather than achieving the ‘China Dream’, the PRC appears headed for a Middle Development Trap in which it will not fulfil its promise, because the political system prevents it from taking the initiatives and risks needed to attain its full potential.

There is nothing new in the awe China inspires – or in the qualifications which need to be attached to it. The rulers of the Middle Kingdom have always spun narratives of uniqueness and power to impress their own people and establish their nation’s superiority for foreigners. They have sought to assume sweeping, supra-human dimensions as they guide a land which they class not as a country like others, but one whose destinies are protected by the Mandate of Heaven. Barbarian admirers have ranged from Marco Polo to Voltaire – though Napoleon’s celebrated remark that the world would tremble when China awoke showed that he had not appreciated that the dragon was far from asleep, coming as it did just at the point at which the Qing dynasty was extending the frontiers of a nation that accounted for perhaps one-third of global wealth.

In our time, those let down by the failure of the Soviet Union to survive the Cold War invest their hopes in a new and formidable challenger to America. Those who doubt the efficacy of democracy and prefer the smack of firm government look with favour on a system that has no time for competitive elections, stamps on dissent and preaches discipline. Enthusiasts for Asia as the region which will shape the world are predisposed to cheer its largest power. Anti-colonialists see Beijing as a champion of their camp. Free marketers can close their eyes to the incantations of Marxism as they herald the opportunities offered by the last great business frontier where regulation, labour laws and environmental rules are agreeably flexible.

These reasons for admiration contain significant flaws, just as the imperial dynasties were frequently less impressive than they appeared. China is still a long way from achieving equal status with the United States in terms of economic strength, military might or innovation. Indeed, Chinese think tanks analysing the fall of the USSR have pointed to the dangers of getting into a knock-down competition with the power across the Pacific. The absence of debate and the strengthening of dogmatic rule under Xi Jinping are a recipe for stagnation; Taiwan’s evolution as a democracy in this century stands in striking contrast to the authoritarian system imposed on the mainland. Though they welcome the benefits offered by the economic growth of China, most Asian nations are alarmed at its power projection and want to go on sheltering under the strategic umbrella Washington has offered East Asia since 1945. The military occupation of Tibet and the huge western territory of Xinjiang looks like a major exercise of colonial rule. As for Chinese business, it can be far from a straightforward market exercise on a level playing field as personal contacts, political interference and corner-cutting come into play in the absence of a reliable and independent legal system. Surveys in 2016 by Western Chambers of Commerce in the PRC reported growing pessimism among their members about doing business on the mainland in an ‘increasingly hostile’ environment deterring increased investment.³

The ancient Confucian civilization which writers like Martin Jacques see as central to their argument that China will come to rule the world has certainly left a powerful legacy, but one may ask how relevant it is to the question at hand, since it offers little or nothing in the way of answers to the present challenges facing the PRC. The sage from Shandong, after all, ranked merchants at the bottom of his social scale. Mao waged a relentless war against his teachings and, in today’s China, the ‘ism’ that rules is materialism, epitomized by the young woman on a television dating show who said she would ‘rather cry in the back of a BMW than laugh on the back of a bicycle’.

When it comes to the assertion that the world will become ‘more Chinese’ and that Chinese influence will spread its soft power through the globe, a stroll through any mainland city and its equivalent in Europe or America will show which culture is the more influential. There are not many Mao suits or Chinese films in Birmingham, England, or Birmingham, Alabama, but Chinese wear jeans, flock to Hollywood films and lap up Downton Abbey. On the mainland, people eat at fast food restaurants on the pattern of KFC and McDonald’s; prime time shows on state television follow foreign patterns; Chinese car models ape those from the West and Japan; and Alibaba has become a monster online enterprise by adapting Western technology and techniques to the domestic market. An international survey in 2016 put the PRC in only 29th place among nations in the soft power league, while official data showed that the number of Chinese students going to foreign universities rose by 14 per cent in 2015 to 523,700.⁴ Indeed, the degree of popular cultural influence from the West, Japan and South Korea is such that, in 2016, the State Council issued an order banning media from running stories which might promote it further.

History has always been a tricky matter in China, since it is shaped to the political imperatives of those in authority. The picture of a glorious imperial age has to be tempered by less glorious realities: recurrent disunion; civil wars; the violent overthrow of rulers; military incursions that led to two foreign dynasties; natural disasters; the refusal to adopt 19th-century modernization; and humiliation at the hands of the Japanese. The next century brought further misery: a decade of national warlord anarchy after the fall of the Empire; weak and largely reactionary Nationalist government; fresh invasions by Japan from 1931 to 1945; a massive toll in deaths and destruction; four years of civil war; and then the traumas of the Mao era from 1949 to 1976, culminating in famine which killed more than 40 million people, many as a result of official policies and bungling.

The vast National History Museum in Beijing leaves no doubt about how the past is to be interpreted. The ‘century of humiliation’ narrative is laid out so as to place the blame for China’s decline in the 19th century squarely on foreigners, rather than on the internal divisions that sapped imperial authority on a much bigger scale. Pre-1949 events are tailored to show that the coming to power of the Communists was an inevitable process, and Mao is treated as a godlike figure who may have made mistakes but who is officially judged as having been ‘70 per cent good, 3...