Is China’s rise now stalling?

Abstract

The variations on power transition theory so widely used to frame analysis of U.S.–China relation tend to assume the inevitability or at least strong probability of China surpassing the United States in economic power if not necessarily military power. In the terminology of social psychology’s attribution theory, China is imputed with the identity of a state that is inevitably rising. The Chinese Communist Party encourages this attribution among Chinese people and foreigners. But China’s economic rise – the foundation of its comprehensive rise – appears to have entered an inflection point in the mid-2010s and may now be stalling. In critical respects, China increasingly resembles the last two countries that ‘attempted’ a globe-level rise: the unsuccessful cases of postwar Japan and the Soviet Union. China’s labor force is shrinking; the country relies excessively on unsustainable debt increases to fuel economic growth; and pollution is seriously harming public health. But even if China’s rise conclusively stalls, it may take quite some time before the Chinese public and outside observers recognize the new reality because of intrinsic biases in the cognitive logic of attributing identities to actors.

Keywords:

• China
• rise
• power transition
• economy
• population
• middle-income trap

Notes

1 I benefited from presenting earlier drafts of this article to thoughtfully critical audiences of colleagues at the City University of Hong Kong’s Department of Asian and International Studies and the University of Southern California’s U.S.–China Institute.

2 To the extent that declining commodity prices played a role in this result, note that a key reason commodity prices fell was collapsing Chinese demand. Also, declining commodity prices did not prevent the overall value of world exports from increasing. The declining commodity prices could not easily explain the contraction in the value of Chinese imports from almost all parts of the world, not just Russia (and Africa).

3 Note that the Chinese currency did not begin its sustained weakening until the CCP devalued in August 2015. The renminbi was significantly stronger in 2013–2015 than it had been from 2010 through 2012 when import growth was booming (Yearly Average, Currency Exchange Rates. (2018, January). Internal Revenue Service. Retrieved from https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates" 2018).

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Notes on contributors

Daniel C. Lynch

Daniel C. Lynch is Professor of Asian and International Studies at the City University of Hong Kong. Lynch is a specialist on Asian political change, Chinese foreign policy, and the international relations of East and Southeast Asia. His most recent book is China's Futures: PRC Elites Debate Economics, Politics, and Foreign Policy (Stanford University Press, 2015).