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Old Thursday, August 02, 2007
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Default China And The New World Order

CHINA AND THE NEW WORLD ORDER



China is very often considered to be the next superpower, which would eventually replace the United States at its position of a global leader. Definitely China has the potential to achieve it, however many experts differ in their predictions when it could happen. Some pundits are even not sure if it ever takes place as for now all projections have speculative character to a great extent. Nevertheless China’s actions and endeavors to enter a group of world’s most influential countries generate close attention.



ECONOMIC ASPECTS



In 2006, according to the World Bank, China became the 4th largest economy in the world and surpassed Great Britain by 0.004% in national production. CIA estimates that Chinese gross domestic product (GDP) measured in purchasing power parity (PPP) equaled approximately $10 trillion in 2006 (GDP measured in PPP places China at a 2nd place just after the U.S.).[1] China’s economy is currently growing at a yearly rate exceeding 10%. Chinese economic Five Year Program (2006-2010), which was launched in March last year, ambitiously assumes that China will reduce its energy consumption by 20% per unit of GDP and by 2010 will double its GDP of 2000. China also wants her GDP to reach $4 trillion by 2020 (measured in official exchange rate). And although China still remains a poor country, what is well evidenced by its index of GDP per capita (only $7,600 in 2006), surpassing the economy of the U.S., which is presently inhabited by 300 million people as compared to roughly 1,3 billion Chinese in China, should be only a matter of time.



However, becoming the world’s largest single economy will not instantly mean that China would become as powerful and influential as the United States. Presently the European Union, comprised of 27 European countries, has a bigger GDP measured in official exchange rate than the United States. Nevertheless, Europe doesn’t match the U.S. neither in her military potential nor in political importance and influence. One may assume that China will find itself in a similar situation. Merely surpassing the U.S. economy in absolute numbers will not mean that China would replace America at her position of the most powerful country in the world. Those who presently predict that the rise of China will cause abdication of the U.S. may be wrong.



The emergence of China, considered in terms of civilization alignments, creates even more doubts. Surpassing the U.S. economy, would still leave China far behind the whole West, because a combined gross domestic product of all Western societies would be far beyond Chinese economy’s reach and capabilities. Due to its huge population, China, even being the biggest economy in the world, would still remain a considerably poor country, prone to civil and social disturbances. Should the West remain politically united (what is, however, presently doubtful in the light of a deep and ongoing transatlantic divide), the emergence of China should not jeopardize West’s importance and political dominance.



It is also uncertain if the rise of China would antagonize her relations with the West. A peaceful rise of China and her cooperative co-existence with the rest of international community is likely as well and cannot be excluded at this point. Such a conclusion would be based on an assumption that China’s further economic growth is impossible without adoption of core Western values, lessening authoritarian, communist rule, implementation of at least some of democratic procedures and as a result maintenance of considerably friendly relations with the West. China may continue to develop in a Japanese-like style, being unique in its cultural identity, however adhering to the fundaments of free market economy and its underlying Western philosophy. As a matter of fact, a long term economical progress without adoption of core Western values is impossible, what is well evidenced by historical experiences of other civilizations, which over the centuries were unable to modernize and sustain their economic growth supporting it with non-western values to which they have adhered.



Samuel P. Huntington claims that one cannot export civilization and therefore non-western countries, such like China, will choose modernization but refuse to westernize, what in long term may antagonize their relations with the West. Historical evidence stands against such a theory. There has been no comparably successful civilization as the West. Modernization is a process which originally occurred only within Western civilization and has been due to its specific values and culture. One cannot separate modernization from westernization in order to export only the first one. Modernization is a result of certain cultural and religious attributes, which are characteristic and unique only for the Western civilization and have not independently prevailed in other civilizations. Countries with a flat social structure, influenced either by political doctrines (like communist Soviet Union and China) or religion (like Arab countries with political Islam), were unable to provide incentive for progress and sustained development. Historically only countries with hierarchical social structure (lower, middle and upper class), and dominant focus on individual's wellbeing rather than welfare of the entire society, were capable of advanced modernization. Said diversified structure accounted for creation of democratic systems in which all social classes have had their political representation. An opportunity given to an individual to progress, through his own hard work, from lower to upper classes, has provided irreplaceable incentive for entrepreneurship and as a consequence for the wellbeing of the whole society. Other civilizations have not created such philosophical, religious and cultural foundations, which would independently enable them to achieve modernization and sustained development. The best evidence that modernization is possible only together with westernization is example of Japan, China and Turkey. Only after implementing market-oriented reforms China was able to improve its condition. Market-oriented economy is inseparable emanation of a democratic system and core Western values, based on a belief that every individual has a right to get rich through his own hard work. Since the late 1970s China has implemented gradual liberalization of prices, fiscal decentralization, diversified banking system, increased autonomy of state businesses and has introduced a stock market. Only continuance of said reforms and incessant adoption of Western solutions may allow China to further develop its economy. It would be a path comparable to that of Japan, which had to accept main core Western values in order to be able to modernize its society and economy. The same example provides Turkey’s history. Turkey has been able to modernize only after it has undertaken endeavors to change its civilization alignment by secularizing its society (resigning from political Islam) and adopting Western political and economical standards. As a result, it is presently the only Muslim state, which eventually has a chance to access the European Union and become a role model for the rest of the Muslim world.



From political point of view, China’s emergence to eminence is also limited by some ethnical aspects. Unlike the United States, China comprises the whole Chinese civilization within its territory. The Western civilization has much wider geographical reach and spans over three different continents: North America, Europe and Australia. If China chooses to stand against the West she will have to form occasional political alliances with countries outside her cultural and civilization’s zone. Such alliances would be much easier to be broken and manipulated than alliances created within a single civilization (like transatlantic alliance).



MILITARY ASPECTS



At the end of the last month, the U.S. Secretary of Defense submitted his annual report to Congress on “Military Power of the People’s Republic of China”. [2] According to the report, “analysis of China’s military acquisitions and strategic thinking suggest Beijing is”, among other things, “generating capabilities for […] regional contingencies, such as conflict over resources or territory”. As the report concludes, a possibility of U.S. intervention in the Taiwan Strait is an important driver of China’s modernization of her military. China is seeking to modernize and improve her military capabilities, what is a result of her regional and global aspirations.



As it was stated in a recent report by Stockholm International Peace Research Institute [3] , “in 2006 China’s military expenditure continued to increase rapidly, for the first time surpassing that of Japan and hence making China the biggest military spender in Asia and the fourth biggest in the world”. SIPRI estimates that China’s military expenditure in 2006 reached $49.5 billion (measured in market exchange rate terms), what gave her said 4th place in a global ranking. However measured in purchasing power parity terms, China’s military expenditures equaled $188.2 billion, what gave her 2nd place just after the U.S. In the same time the U.S. military expenditures reached $528,7 (in both measuring variations). The United States with 5% share of World’s population accounts for 46% of all global military expenditures. While China with 20% share of World’s population accounts only for 4% of all global military expenditures. And although those figures still put China far behind the U.S., SIPRI points out that Chinese military budget continues to increase fast. Between 1997 and 2006 it grew by 195%.



Nevertheless, Gen. Michael D. Maples, U.S. Army Director – Defense Intelligence Agency, in his statement for the Record Senate Select Committee on January 11, this year, said that U.S. intelligence estimates Chinese military spending in 2006 to be actually much bigger, between $80-115 billion [4] . In his overall impression, Gen. Maples said that “China’s strategic course appears to focus primarily on internal issues and its foreign policy is driven by several related internal concerns: continuing economic development, maintaining communist party control, and safeguarding internal stability”. He points out that China’s petroleum demands have risen sharply, making China the world’s second largest consumer and third largest importer of oil. In Gen. Maples’s opinion “China’s continued search for energy may become a point of contention between itself and the West, potentially affecting its policy toward Iran, a key Chinese energy supplier”.



As it was stated in the report by Secretary of Defense, China’s overall grand strategy rests on the desire to maintain the continuous rule of the Chinese Communist Party (CCP). Nevertheless the CCP situation is complex. China has a very low index of GDP per capita, what keeps her society very poor and living conditions hard. Additionally, the communist ideology, incorporating social and economic equality of people, has failed. Therefore CCP is presently basing its legitimacy to rule on two other pillars: economic performance and nationalism. This may spark some considerable worries. Should China start to experience economical and social domestic difficulties, the CCP, in order to remain in power, may attempt to bolster nationalist sentiments, which could result in aggressive behavior in foreign and security affairs. Peaceful rise of China is probable, however not completely certain.



DECLINE OF THE WEST?



There have been many theories heard that the West is declining and therefore the U.S., and the Western civilization as a whole, should prepare to abdicate from its present dominant position. Those theories, basically,are based on two facts that the fertility rate of white race in Western societies is much lower than in other civilizations and that the West’s percentage share in global economy is diminishing in favor of other emerging markets. These arguments are subject to debate. One may point out to the facts which lead to contrary conclusions.



Presently demographic projections for the U.S. estimate that in 2010 its population will reach 308,936 million people, in 2020 will increase to 335,805 million, in 2030 to 363,584 million, in 2040 to 391,946 million and in 2050 will go up to 419,854 million. The overall increase will be roughly 120 million, while white people (including whites of Hispanic origin) will account for 72,1% of the American population. [5] Such a big boost will make it easier for the U.S. to compete for global leadership with more populous states like China, India or the European Union. Additional 120 million people will produce higher gross domestic product. Therefore economical and political position of the U.S. will rather strengthen than decline.



Disadvantageous trend showing aging of the West's population can be also reversed through legislative initiatives. In Australia, when in July 2004, a law was adopted under which a woman is paid $3,000 for every childbirth, the fertility rate increased from 1,77 in 2004 to 1,81 in 2005. [6] Meantime, many European states have adopted similar, family-friendly, policies to boost their fertility rate and prevent demographic decline. For example, German family minister Ursula von der Leyen proposed a project, which provides mothers and fathers with two-thirds of their last net paycheck, up to €1,800 for up to a year. [7] Should the West continue its family-friendly policies, its position will not be jeopardized by unfavorable demographic changes. Those trends can be reversed.



NEW WORLD ORDER



While the U.S. will be becoming more populous and economically stronger, its future concerns will be the emergence of China and India as regional and potentially global powers. China is predestined to play more important role in regional and international affairs. Should her development continue, China will eventually achieve its righteous place in global distribution of power. It is however unlikely that Chinese civilization will match the potential of the Western civilization and as a result a bipolar system of international relations will emerge as the one which existed during the Cold War with Soviet Union.



As Henry Kissinger says, when members of a group of states of comparable strength “are obliged to deal with one another, there are only two possible outcomes: either one state becomes so strong that it dominates all the others and creates an empire, or no state is ever quite powerful enough to achieve that goal […] in the latter case, the pretensions of the most aggressive member of the international community are kept in check by a combination of the others; in other words, by the operation of balance of power”. [8] After the end of the Cold War and dissolution of the Soviet Union the first scenario took hold and the United States became the most dominant state in international relations, additionally entering imperial stage of its existence. The U.S. as the only state in the world has been able to conduct military operation in every part of the globe without significant political or logistical support of its allies.



Kissinger predicts, however, that the United States will gradually decline and a new international relations system will emerge. In his opinion, a new world order “will contain at least six major powers – the United States, Europe, China, Japan, Russia, and probably India – as well as a multiplicity of medium-sized and smaller countries”. In such situation a global system of balance of power will be needed and the U.S. will have to enter in alliances with other states to contain the power of its opponents. Kissinger’s conclusions are based on two assumptions that the U.S. power will eventually diminish and that the new states, like China and India, will emerge to eminence on international scene.



Nevertheless, the decline of the U.S. is not so certain anymore considering present circumstances. As it was showed above, American population will be growing rapidly in the next 40 years (although the ethnical composition will be changing) and so will the gross domestic product. Additionally, a decrease in U.S. military expenditures, which followed the end of the Cold War (one of Kissinger’s arguments supporting his theory of America's decline), has been reversed by terrorist attacks of 2001 and subsequent wars in Afghanistan and Iraq. The U.S. military doctrine has changed. According to SIPRI, U.S. spending caused by those two wars will reach $2,267 billion in a period of 2001 – 2016. [9] America’s increased military expenditures further support her dominant position in the world. Additionally, countries like Japan and China, potential candidates for global superpowers, have already started to face serious growth barriers. Japan has too small a territory for its 127 million population and remains a military dwarf, while China, with its 1,321 billion inhabitants has difficulty in securing energy supplies high enough to sustain its further development, what in longer term can cause serious economical slowdown with social and economical disturbances.



Meantime the U.S. has been pragmatically adjusting to this new situation securing its dominance, by planning to locate a national missile defense system in Eastern Europe, which would eventually considerably diminish military capabilities of Russia and potential Russia-China alliance against the West. In the same time, Japan has been vigorously aligning itself with the Western civilization by entering into a security agreement with Australia [10] , early this year, and strengthening its relations with NATO [11] (Shinzo Abe paid a historic visit to NATO’s headquarters, which was later on followed by a visit of Japanese Minister of Defense, Fumio Kyuma, in May this year).



A different new world order is emerging. However, ultimate decline and abdication of the West is highly hypothetic. Favorable demographic projections for the U.S. and the undergoing internal changes in the EU, aimed at creation of a united Europe, may cause the Western civilization to become even more powerful than it was in the past. Important tasks for the U.S. and Europe will be an assimilation of Latin immigrants into mainstream American values in the U.S. and Muslims into political democratic system in Europe. The main goal of the West should be to adjust in time to presently changing situation by securing its dominant position for the future. China would then have no option but to emerge peacefully by seeking cooperation with the West, rather than a confrontation.
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