Project Syndicate on 20 October 2022
KISHORE MAHBUBANI
The
Western media have done Xi a great favor: they have bestowed upon him
low expectations. Many Western observers, including thoughtful ones,
believe that the great China growth story is over, because China is now
ruled by an incompetent and isolated leader. Xi will shatter their
expectations.
But
this is not just about Xi. No one person – not even Xi – is responsible
for driving China’s growth. Larger structural forces are at play. For
starters, China’s years of investing massively in physical
infrastructure and human capital are likely to pay off in the coming
decades. Yes, in a few decades, China’s demographic decline will
generate headwinds. But, before that happens, the country will benefit
from an explosion of talent in science and technology. Since 2019, China
has been producing more research than the United States and Europe
overall, and a higher percentage of its research was among the top 1% of
papers by citation globally.
America’s
decision to cut off chip supplies to China will be a short-term
setback, but it won’t cripple China. In fact, US efforts to contain
China’s rise – such as launching a trade and technology war and
“needling” the country on Taiwan – have served only to reinforce a broad
consensus to achieve “national rejuvenation.” China remains as
determined as ever to avoid another “century of humiliation” by the
West. When Xi said in his speech at the CPC Congress that China should
“be ready to withstand high winds, choppy waters, and even dangerous
storms,” most Chinese would have nodded in agreement.
The
Regional Comprehensive Economic Partnership (RCEP) – the world’s
largest free-trade agreement – will add yet more fuel to China’s
economy. And the dual-circulation strategy will soon begin to pay off,
not least owing to the rapid growth of China’s retail market, which has
swelled from $2.3 trillion (much smaller than America’s $3.9 trillion)
in 2010 to $6 trillion in 2020 (surpassing America’s $5.6 trillion). Now
extrapolate that to 2030.
Short-term
challenges remain, including the zero-COVID policy, the real-estate
bubble, and US technology sanctions, and 2022 will be one of the Chinese
economy’s worst years in recent history. But pragmatic and rational
governance has been enabling China to overcome major public policy
challenges for decades, and that is not going to change. China will
bounce back from its current struggles.
In short, don’t bet against China and Xi. The great Chinese growth story will continue.