Since the 1970s, Beijing began its relentless push into the free-market economy and now it sets to surpass the United States and become the world’s preeminent power. Under the aegis of impressive reforms led by late president Deng Xiaoping and gradual ease on the regulations concerning foreign investments, the path was clear for China’s skyrocketing economic progress. China entered the 1990s as an important economic force to be reckoned with.
In 2009, authorities in Beijing declared that their country’s economy expands at eye-popping rates. Charts show that the Chinese economy grew rapidly from %8.7 to %9.1, emerging as the world’s second-largest economy after the United States. but amid the COVID-19 pandemic, the global virus-hit economy suffered an unprecedented collapse; the United States as the world’s largest economy shrank by %9, Chinese once-booming economy contracts %6.8 and Japan’s economy which currently ranks third worldwide, experienced its biggest slump in decades as it dropped by %7.8.
Withstanding the current financial setbacks, China is truly one of the successful economies during the coronavirus dilemma, as the estimates say that the Chinese economy is reviving and speedily bounced back into %3.2 growth.
Meanwhile, the Chinese leaders seek to maintain their distinctive niche in the international arena by mounting ambitious projects and set of steady investments in rather poor countries like Pakistan. At the core of the Chinese Communist Party’s hegemonic agenda lays the massive Belt and Road Initiative (BRI); which relentlessly pursues reinvigorating the ancient Silk Road. Delivering a state speech in 2013 at Nazarbayev University in Astana, the capital city of Kazakhstan, President Xi Jinping promulgated the commencement of the gigantic BRI; Hence sending a strong tremor through the Western block.
The BRI aims to finance directly in infrastructure projects, such as building railways, highways, bridges and ports…etc., within the Chinese territories and abroad, as far as Africa. BRI incorporates two major strategies: a colossal trans-continental land corridor which connects China with South-East Asia, Central Asia, Middle East, Russia and ultimately Europe (Belt); whereas (Road) refers to the sea routes, or better to say “the 21st century maritime Silk Road. Among the BRI’s key projects, the China–Pakistan Economic Corridor (CPEC) can be considered as the centrepiece of China’s determined efforts to defeat U.S. in the “New Great Game”.
So it is evident why the U.S. officials are afraid of China’s formidable economy, placing Beijing’s economic development, rather than military strength, as the most impending threat to the U.S. national security. In this regard, U.S. Secretary of State Mike Pompeo in last visit to the Czech Republic acknowledged that it is more challenging for the United States to cope with Chinese ascending economic and military growth than facing the Soviet Union’s threats, back during the Cold War. Stressing on U.S. vulnerabilities, Secretary Pompeo was quoted as saying: “China is using its economic might to expand its influence all over the world.”
Nowadays, many market analysts believe that the ongoing financial mêlée between the United States and communist China clearly manifests the fact that nowadays superpowers, namely China, seek to bring their enemies to their knees through the trade war. Over the past two decades, gross Sino-US trade flows have increased dramatically, from $61 billion a year in 2000 to $540 billion in 2019. However, that figure marked a sharp drop from a record peak of $635 billion in 2018, and can be largely attributed to large increases in the effective tariff rate that face exporters in both countries now. For comparison, the $95 billion decline in trade flows last year was three times as large as that seen during the Global Financial Crisis of 2009. Exports from China to the US increased much more rapidly than exports from the US to China. Thus, the US trade deficit with China steadily increased. Indeed, China accounted for 20% of the overall US trade deficit in 2000, rising to 48% by 2015.
Also among Beijing’s worldwide shrewd financial strategies, one must mention the establishment of Chinese private firms which play well their role as the Chinese regime’s pawns in controlling the global trade and maintaining china’s eminent status in different aspects of competition with the U.S., i.e. of transportation, communications, IT, constructing advanced power plants and other basic infrastructure. Among world’s 500 largest companies, the U.S. owns 121 firms and China runs neck-and-neck by controlling 119 enterprises. There are now more voices engaging in market prognostication who express that it is not unlikely that China will overtake Washington by 2030.
Furthermore, one of China’s key strategy to defeat its western foe is called ‘Debt Trap’ policy which in reality is to offer alluring loans to destitute, developing and above all geopolitically useful countries, mostly in the African continent. As these impoverished nations fail to repay their debts, China would wrest control of the hapless nation’s vital infrastructure like ports, mines…etc.
In other words, China’s Belt and Road Initiative (BRI) in poor though strategically key countries, like Siri Lanka, is a good example of ‘Debt Trap’ policy. In 2017, Sri Lankan government had to formally hand over its southern port of Hambantota to China on a 99-year lease.
Now, it seems the United States desperate attempts to impede Beijing won’t beat the rising Chinese dragon.