Pearls and Irritations

Is China mired in economic misery while bogged down by old habits- or very successfully developing its exceptional manufacturing prowess as it expands and consolidates its influence across the Global South (and well beyond)? Never mind any apparent contradiction, one leading global weekly answers yes and yes to these two questions.

As the Third Plenum of Communist Party of China (CPC) got underway in Beijing in mid-July, The Economist, devoted many, column-inches – with a predictably censorious tilt – to explaining this critical CPC economic planning meeting. Around the same time, the Economist ran a lead story telling the world that “Chinese companies are winning the Global South”.

So, what is going on?

Chinese industrial policy

The IMF has defined “Industrial Policy” as:
Government efforts to shape the economy by targeting specific industries, firms, or economic activities. This is achieved through a range of tools such as subsidies, tax incentives, infrastructure development, protective regulations, and research and development support.

Here is a fundamental fact: No country has ever successfully applied industrial policy, on such a scale, in a manner comparable to China.

In the forty years after the start of the PRC’s “open door” policy, China’s GDP had, by 2018, risen around 45 fold according to an authoritative ANU study lifting over 800 million people out of extreme poverty, according to the World Bank.

This has been marvellous for China. But it has also hugely benefitted jurisdictions across the rest of the world.

Consider this remarkable fact. Over the 26 years from 1991 until 2017, Australia broke the OECD record for uninterrupted, recession-free economic growth, according to the Economist. That performance was centrally powered by the exceptional engagement of the Australian economy with the rise of China.

In fact, the rise of China has helped drive and regularly super-charge a range of economies in East Asia, around the Pacific-rim and well beyond.

China presses on

Over time, the PRC has kept shifting up several more scientific and economic gears:

• The Economist recently confirmed that China is now a scientific superpower.
• Quoting an extended study by the Australian Strategic Policy Institute (ASPI), the Guardian argued in March, 2023 that, “China is leading the US in the technology race in all but a few fields”

China’s domination of global manufacturing includes: ship-building, vehicles, batteries, solar panels, green-technology generally, the widest range of household and recreational items plus medical necessities. Its building of all forms of transport and information infrastructure now eclipses comparable work currently being done across all of the Global West.

This can-do-prowess, in turn, underpins the prominent global achievements of China’s trillion-dollar Belt and Road Initiative (BRI). For the BRI, it has not all been plain sailing, but it is still far ahead, in terms of achievements, compared to its pallid Western imitators according to a recent report from Griffith University.

Meanwhile, China’s well-staffed hospital ship, the Peace Ark, has been making extended voyages in recent years to Latin America, Africa and Pacific island states.

China has also become a ground-breaking leader in space exploration, according to CNN.

Some Western responses

It is true that Washington is doing all it can, by strong-arming allies and Western business, to thwart Beijing’s access to certain high-tech chips and the equipment to make them. But serious US commentators now argue that this “break-their-legs” strategy is most likely to prompt intensified, well-funded R&D in China to “onshore” such production sooner rather than later.

In a recent, informing Singaporean documentary, produced by Channel News Asia and rebroadcast by the ABC in Australia, Professor Wang Yiwei, from Renmin University in Beijing, robustly contradicted American lectures about overcapacity in China, arguing, in essence that these claims were aimed at distracting attention from plain US underperformance.

Speaking of those who find serious competition discomfiting, ugly Western responses (scarcely covered in the Western media) directed at Chinese competitors, especially by American, Australian and Swedish participants and media folk, is one unfortunate reason why the Paris Olympics may be distinctly remembered.

Let’s go to war versus let’s go to work

The Global South is presently taking stock of where geopolitical realities stand today and where they are headed. And here is the sort of perspective that is taking shape.

Notwithstanding massive intensified marketing by the Mainstream Western Media arguing that the West is forever crusading for freedom, democracy and human rights, once one considers embedded, repetitive performance stretching back decades, the dominant motto guiding ultimate American hegemonic action is: Let’s go to war. Any doubt about this being so has been comprehensively erased by the mass, homicidal horror stories emerging, month after month, from the hellscape created by Israel in Gaza, backed with obscene fervour by the US.

China, however, has been living in accordance with a very different motto for over four decades: Let’s go to work.

Very recently, former Prime Minister Paul Keating once more emphasised the degree to which Australia is dismally caught within an American geopolitical grip. As a direct consequence, Canberra cannot – or will not – comprehend this basic, war-work dichotomy.

Professor Kerry Brown of King’s College in London lately observed that the rise of China is now so conclusively underway that it comprises an epoch-shaping process which is set to continue long-term. This viewpoint does not overlook that China faces immense current and future challenges. But Beijing’s track record firmly suggests that China should find ways to get past most of these, over time. The US also faces massive and increasing challenges. They, however, look far more intractable than those faced by China.

Squaring the ledger

The Global South has worked all this out and understands the dichotomy outlined above. Moreover, it is within this considered understanding that a recent observation by Professor Wang from Renmin University fits rather well. Looking forward, he argued how he saw a future where far more would be: made in Africa, with China, for the world.

This is an economic blueprint that looks set, over time, to be embraced circumspectly across much of the Global South. Which means we can expect yet more pearl clutching at The Economist and like-minded media outlets across the Global West as they fret over this scary trajectory, while Canberra obediently nods along in anxious, American-massaged agreement.

Share and Enjoy !

SHARE TWEET SHARE COPY EMAIL PRINT