Will China replace US as superpower for the 21st Century?

China will replace US as superpower for the 21st Century-

INTRODUCTION: From early on, China and the rest of Asia was home to all the world's dominating civilizations. As Europe started to develop and the United States came into existence, that power jumped Western world. Now China has one of the strongest and fastest growing economies that is starting to take over the world market. When the U.S. went to Seoul a few weeks ago to meet with China and ask them to change their currency policy, China responded with, we are the masters now. Ever since the 1950's China has mimicked the Western culture and started improving their infrastructure and their use of raw materials. Over the past 26 years the country has had the biggest and fastest industrial revolution ever. China's GDP has been multiplied by 10 and is on course to surpass the U.S' GDP. China is rising. Since its reform policy at the end of the 1970s, China s economy has been growing at an average rate of 9 per cent annually. China has become the third largest world economy. It overtook the United States as Japan s largest trading partner in 2004, as India s in 2008, and as Brazil s in 2009. China is the largest source of US imports, with which it enjoyed a trade surplus of $266.3 billion in 2008. The financial crisis has further enhanced China s importance in the world economy. It is said to have about $2 trillion in foreign currency reserves. This huge reserve of US currency contrasts sharply with the US, whose budget deficit is likely to exceed $2 trillion this year. The Chinese government s $586 billion stimulus package demonstrated its determination to keep the crisis at bay. Zhou Xiaochuan, the head of the People s Bank of China, feels that the flaws in the international monetary system could be dealt with to a certain degree by creating a new world reserve currency. His controversial idea alarmed the Americans, but was quietly welcomed by many Europeans and Asians. Although Zhou s idea is not to replace the dominant status of the dollar in the near future, it may provoke a revolution in the international monetary system.

Together with China s rising economic power, China has also steadily increased its military expenditure, with double digit annual growth. It is building its military force into one which matches its rising economic power and which can defend, in particular, its air and sea territory. As a consequence of its military build up, China has gradually flexed its muscle and become more active. Chinese leaders are not only trying to find solutions for the problems that have occurred, but are also interested in finding out why they occurred in the first place, so as to avoid similar problems in the future. DECLINING ROLE OF THE USA IN WORLD ECONOMY: Some people have postulated that the role of the United States in the global economy is declining, with its position as a world leader being replaced by China. The financial crisis seems to give China a golden opportunity to strengthen this trend. But, while it is undeniable that there is a long term tendency that China is raising, the current financial crisis will not dramatically facilitate China s rise at the sacrifice of the interests of the United States. Why not? First of all, the financial crisis is a challenge for both the US and China. The fact that China is the largest owner of US debt only serves to emphasize that the two are in the same boat. Both must accept this major interdependence and coordinate with each other. And like it or not, China will be obliged to continue to buy American debt. Most recently, the BRIC (Brazil, Russia, India, China) countries held their first summit meeting. Seeing the international crisis as an opportunity for the international economic and political order to be readjusted, the four countries expressed their ambition and willingness to participate more actively in international affairs. China is undoubtedly the most influential among the four, but the BRIC format can be a good platform for China to bargain with the US and Europe on issues of sustainable development, global warming and world peace and stability. Although the Chinese Premier Wen expressed his concern early this year about the value of the American debt, he knows that if China stopped buying it, its value would drop even more drastically. China needs to help the United States in order to help itself. On the other hand, while China is in search of other currencies as target of investment, it seems that neither euros nor yens are ready to serve as alternatives. Furthermore, China s development is led by exports. The drastic decline of demand from the United States, the European Union and Japan due to financial crisis had an immediate impact on Chinese foreign trade - it decreased 25.9 per cent in May 2009 compared to the same period of the previous year. Many export-oriented enterprises have been bankrupted and more than 20 million workers have become jobless. Tension between the U.S and China is forming over the value of the two country's currency. The world is accusing China of keeping the value of the yen down, and China is attacking the U.S. for implementing the quantitative easing process, which was recently announced. To aid in their

own development, China is importing more goods into the country than ever seen before. In 20 years it is predicted that they will be using one-fifth of the world's available energy. Along with importing from overseas, China is also investing overseas and is making incredible returns. America is now faced with the dilemma of whether to aid in China's rapid growth or to contain it. If the U.S decides to aid China then they are saying that China is more powerful than the U.S. It would, in a sense, imply that the U.S is surrendering to China. If the United States attempts to contain China then they will be flexing their muscles and will be sending the message that they want to remain on top of the world's market. CHALLENGE AHEAD: China will need to address lagging political and social reform in order to build up a comprehensive welfare system which offers its people reasonable social security. Only by removing Chinese people s concerns about education, medical insurance and pensions can domestic consumption be stimulated effectively. But this will not happen overnight. Finally and most importantly, China has neither the ambition nor the capability to challenge the leadership of the United States. Compared with the superpower of the US, China is only a regional power. Both the cost and risk are too high for Beijing to commit itself to so many international issues as the US, from Iraq to Afghanistan, from Iran to North Korea. If managed well, China s both hard power and soft power will further grow after the financial crisis - but the US will still be unmatched More power in the world means more responsibility. But China is not yet ready to take on so much international responsibility. China s top priority is its own economic development. What China cares about most is regional peace and stability. Despite the fact that China is rising, it is incapable of playing the role the United States has been playing in international affairs. In fact, the economic and political order established by the United States created a favourable environment for China s development. China jumped on the bandwagon of the US and benefited tremendously from the international system maintained by the US. The benefits Beijing gains will encourage it to stay under the leadership of Washington. If managed well, China s both hard power and soft power will further grow after the financial crisis - but the US will still be unmatched. What China needs to clarify to the US is that they are not competitors but partners - for both their own interests and those of the world. WILL CHINA SUCCEED? The invincible Western firepower in the Opium War and the subsequent tragedy that put China in ruins is illustrated here. China does have the potential in the future to generate culture that is richer than Western culture, but only after Chinese culture completely digests the essence of the values of Western culture. After the global financial crisis began, the view that China would save the world economy continually appeared in local newspapers. China's GDP accounts for only 6 percent of the world's total, and the per-capita GDP ranks far behind the 100th. How can a country like that

save the world? We also have problems in social administration, official management and moral beliefs. China was less affected by the recession because our capital market was not developed enough. The odd thing is that USA seems to agree with the opinion of the Chinese classics scholars. For months, people in the West talked about the precautions that the era of the US will end. Actually this is the secret strategy for the US to maintain its superpower status. As long as the alarm that the US is declining keeps ringing in its people's heads, the US will maintain its No. 1 position. LOOKING TO THE FUTURE: The duel in the 21st century between China and the United States is over which one will be the global champion. In the past 500 years, different countries have emerged as the global champion -- Portugal in the 16th century, followed by Holland, then England in the 18th and 19th centuries, and the United States in the 20th century. It will be China's turn to be the global champion in the 21st century. Colonel Liu, a professor at the National Defense University -- an elite academy tasked with training senior PLA officers expeccts China to replace the United States as the top global player by building its economy into the world's biggest and complementing it with a formidable military. Liu said it would take 90 years for China to catch up with the United States, roughly divided into three stages: 30 years to match its gross domestic product; 30 years to equal its strength in military and cultural spheres; and another 30 years to equal, if not surpass, its per capita GDP. It can be said that China will be a big power in the future and perhaps become a superpower, it cannot be believed that it will be as big as the United States. Economically, assuming all things stay the same, China has the capacity to outgrow the United States. However, this does not mean that China will be leading the United States. China has a bigger population than the United States, but Chinese citizens are not as wealthy as U.S. citizens. It's also unlikely that China will lead the United States in technology and innovation, which are another way to growth in the 21st century. And, because China is largely still an authoritarian regime, politically, the U.S. would be more acceptable to wider spectrum of economies and states, especially in Europe and Japan. Rapid economic growth, global trading ties, and expanding diplomatic cooperation have pushed China to the first rank of nations. There are other potential contenders for future international influence Brazil and India, for instance but Beijing is likely the next peer competitor to the US. No one knows when, but some day the PRC and America are likely to meet as equals. Who will dominate the 21st century? Maybe only God knows the answer. But one thing is for sure: the 21st century could belong to anyone except those who are too arrogant to remember a short time ago they have barely survived.

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