“A bad year in China is going to be a great year in any other country”. This difference in attitude and perception, of the magnitude of success and development, is not because of any discrimination or any other malpractices, but because of the levels of rapid development and the exponential rate of growth in which the Chinese economy has risen itself to. The Chinese, often regarded as a synonym to efficiency and perfectionism, have constantly evolved and improved themselves according to the world’s dynamics to become one of the world’s largest economy, seconded only by the US.
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The People’s Republic of China- the world’s 2nd largest economy with a nominal GDP of $14 trillion has been tongue-tied in a trade war with the United States of America to surpass the latter and claim the title of the undisputed global superpower. But this claim to fame has been disrupting the world economy leading to a global slowdown. And China’s economic structure has been undergoing major changes due to the aforementioned phenomenon.
The China- Pakistan Economic Corridor (CPEC) is a network of highways, railways and infrastructure projects under the Belt and Road Initiative (BRI) that will run from Kashgar in China to Gwadar Port in Baluchistan. The project was launched in 2015 with the Beijing government planning to invest $50 billion in 15 years to successfully implement the initiative. Pakistan and China shall monitor the progress of the project by deploying satellites that were launched in June 2018. The project is currently operating in its second phase with both the nations claiming a multifold increase in trade that would benefit other Asian and Gulf countries as well.
The global financial crisis of 2007 induced recessions in many countries, but China managed to retain its robust growth levels despite dampened western demand. What is most surprising is that, how did an export-led economy like China manage to keep its finances intact in the midst of the turmoil? The answer lies in the “benevolence” of the government in launching a huge fiscal stimulus package amounting to $600 billion (about 20% of the country’s GDP), which was successful in boosting domestic demand and this is the start of a story which can have pretty much the same repercussions on the global economy as the 2007 crisis had.
What has been the background of Trade War?: Ever since the presidential campaign of the current United States President, Donald Trump, the focus has been on reducing the rising trade deficit of the country, by imposing huge tariffs and reducing imports. The underlying belief being that, this would also help in boosting domestic production. In the early 1980’s, China had become the world’s largest exporter and the US became the world’s largest importer, with the majority of its imports coming from China. This was the start of the first trade constraint imposed by Congress on investment or imports from China.
The USA-China-Russia strategic triangle has been an equation of unparalleled geopolitical importance in the last 70 years. Within that time, it is hard to pinpoint a major global event where at least one of these countries did not play a significant role. In fact, it is fair to claim that after the Second World War only these three countries have possessed the necessary political and economic clout essential for exerting a sizeable influence anywhere in the world. The present-day geopolitical scenario, which is riddled with stark polarization as a result of the onset of right-wing governments, is largely dependent on the dynamics created by this strategic triangle.
There are always leaders and followers and one bitter truth that the world has always witnessed is that in this system there are superpowers that act as the leaders of the globe. The 19th century saw the rule of the Grand Britain Empire. The 20th century witnessed the advent of the two mighty superpowers of Soviet Union and the USA. After the breakdown of Soviet Union though there has been just one world leader that is the US. However, in the last 5 years we have seen US taking a back step from its responsibilities of the leader to helping its own economy. So the world asks in unison what next? Does this uncertainty along with the global slowdown in the economy indicate the emergence of a new superpower? If yes, then who do you think could it be!
China can undoubtedly be compared to that mischievous and nasty child of the class who easily discovers new strategies to disgust and bully their allies and thus maintains toxic relations with its neighbors. This time the disputed country has taken a step forward and has been indulged in constructing islands in the South China Sea over which it claims it’s historical rights.