REALITY CHECK FOR CHINA : POST COVID WORLD
Covid — 19 continues to take the world by surprise every single day. Countries around the world are still struggling even to figure out whether they are at the ‘onset’ stage, ‘full bloom’ stage or the ‘decline stage’. China is the only exception to this mayhem and her exclusion remains unexplained and unconvincing. China which was the first to be struck by the virus, should have, logically, suffered the most extensive geographic spread within its borders and also taken the heaviest toll in terms of human lives. But miraculously or dubiously, the dreaded virus which is leaving behind in its wake unprecedented misery in every country that it has touched, seems to have been in a fairly considerate mood as it traveled through China. In fact, in hindsight, it appears that the virus was in a hurry to leave China without paying the courtesy of even a flying visit to major industrial cities like Shenzhen. This naturally raises the suspicion of some earlier acquaintance between the two, the virus and China. The mystery gets even bigger when we find that, despite their valuable experience and ‘remarkable success’ in chasing the virus out from their shores so fast, they have nothing, whatsoever, to offer to the world by way of a solution. The only thing they have offered the world so far, from the lessons of their remarkable success and experience in getting rid of the virus, are some Personal Protection Equipment (which also some reports claim are defective/ second hand!).
That apart, while the world is still grappling with the virus, China, pretends to be oblivious to its severe impact on rest of the world and have hurriedly embarked on restarting their manufacturing facilities. They seem to be in an even greater hurry to make a killing by gobbling up shares of companies around the world at throw away prices.
It is obvious that post the COVID calamity, we will wake up to a changing world, in many ways akin to what would have been a post WW-3 scenario. We must expect intense jostling to change the existing equations and world order. Xi Jinping’s China will leave no stone unturned to impose itself as the global leader by unseating the US –West combine. But will they succeed? Will China be any closer to becoming the primary world power in the post COVID -19 world?
China has, over the past few decades, taken great strides in its journey towards becoming a leading world economic power. It has established itself as the undisputed manufacturing hub of the world and accounts for 35% of the global manufacturing output. 2017 figures show China as the world’s largest exporter with a tally of $ 2.2 trillion, while its imports stood at $1.7 trillion. Its share of global GDP in 2018 was about 16%. In fact, behind almost every electronics item around the world one finds the label “Made in China”. Having become a global economic power, China has demonstrated no inhibition in using economic coercion as an acceptable tool against nations. This spectacular Chinese economic growth, however, is not without voids. China still remains reliant on import for several core technologies. Its per capita GDP (PPP) in 2017 stood at $ 16,842 against $ 59,928 of the US, $ 52,556 of Germany and $ 42,067 of Japan. It is also important to note that very little information flows out regarding the economic development of areas beyond the big metros of China.
China has taken great strides as a military power also and ranks third in the global power index after the US and Russia. But the Chinese PLA is grossly short on war experience when it comes to fighting integrated battle by globally dispersed forces employing land, air, sea and space based war fighting platforms and remains largely an untested global military power. The Chinese also lack experience in interoperability with the armed forces of other nations. Notwithstanding this, the fact is that China is more than adequately equipped to deter a war against it even by the US. China also appears to be well prepared for the ever evolving new dimensions future wars.
A true global power in the modern world achieves far more through its soft power than by employing its hard power. Hard power remain a must for any nation to prevent its use against it by its adversaries. But beyond that, it plays a major role in reinforcing a country’s soft power and increasing its effectiveness manifold. Soft power takes many decades to build and the process of building it up cannot be speeded up. It is in its soft power that China draws a blank, almost. It looks almost unreal that the Chinese, who have traditionally displayed great vision and a clear understanding of strategy, overlooked the need to build up this important ingredient of ‘power’. It could be that the Chinese psyche continues to be influenced by the belief that the ‘Relative Isolation’ which contributed to the survival and well being of the middle kingdom for centuries has relevance in todays world also.
As far as soft power is concerned, some of the distinct advantages enjoyed by the US which enables it to assume global leadership, vis-a-vis China are:
- Despite its unsatisfactory performance against the virus, US is still the most powerful country in the world. While on the one side it is the most flourishing democracy with deep rooted democratic values and well established democratic institutions which stands up to the scrutiny and criticism of any Tom, Dick and Harry around the world, the other side is a web of citizens enjoying almost unfettered freedom and liberty and a capitalist system which provides the most fertile ground for entrepreneurship to flourish,regardless of colour, creed, caste or nationality. Like a good democracy, its citizens have the option to choose a new leader in every election and there is not dependence on any single leader or one political party.
- It has the best of global academic institutions, best of research centers, best of think tanks etc and attracts the best brains in every field from around the world.
- US is the biggest global R&D power house and a reservoir of intellectual property.
- There is a great deal of good will, transparency and trust that the US enjoys around the world.
- Reach of the American military power and its diplomatic arm remains unmatched.
- The liberal, transparent, democratic appeal of the US-West combine is a formidable challenge.
- A sizable chunk of the brightest minds around the world cherish a ‘US dream’. This is true even of the Chinese communists and their counterparts elsewhere. It is not China but the US which is the preferred destination for their children, whether for studies or for earning a livelihood.
In contrast to this immense soft power enjoyed by the US, we have the Chinese model of a closed society and an autocratic, authoritarian system, notorious for its iron hand which gives zero political or social freedom. It is also well known that despite its best of efforts, China is yet to make any impact on becoming a preferred destination for education, research, medical treatment etc. The migrant flow into China which stands at a low 0.2% of the global total, sums up the story. When it comes to flexing its economic muscles and coercing nations to fall in line, China has earned the reputation of being a bully. As a result of this, any economic partnership with China is viewed suspiciously by economic partners and potential partners. Whatever reputation China had systematically built up as the preferred manufacturing hub of the world during the past three decades through efficiency, cheap labour and world class infrastructure, has taken a severe beating due to its suspected active role in ‘Covid 19 distribution’ to the world. Already, countries like Japan have initiated action for funding their firms to shift their production out of China. The Chinese attempts to gobble up companies and raid the global share markets has also alerted nations including India. SEBI has asked custodian banks to disclose details of UBO (Ultimate Beneficial Owners) of FPIs based in China and Hong Kong.
The middle kingdom has a long way, this time a much longer and mostly unfamiliar route unlike the economic development road that it travelled so successfully, in order to transform itself into a soft power empowered China, with its soft power matching its hard power. This journey for China, to be successful, demands a different set of skills and will take time. Till that happens, it appears, China, the global leader, may remain sans followers.
CA Krishnan
