This is the first Tangram from Observing China, where the leading China experts give a diverse range of succinct responses to key questions on the development of the People’s Republic of China (PRC).
As the People’s Republic of China (PRC) entered the 21st century, we saw a concerted effort on behalf of the Chinese Communist Party (CCP) to assert itself as the powerhouse for what it calls ‘the inevitable rise of China’.
Even more so since the turn of the 21st century, the CCP has invested vast amounts into the various aspects needed to make a country a ‘great’ power, with the ambition of the PRC surpassing the United States (US): the military, infrastructure projects and the state propaganda machine have all enjoyed vertiginous boosts in financial resources and personnel. The CCP’s control over its territorial claims has only tightened, from Tibet to Hong Kong. In 2020, Xi Jinping, General Secretary of the CCP, claimed that the PRC had eradicated extreme poverty according to its national standards. The PRC is now the largest trading partner to over 100 countries, and many nations around the world are all too aware that they cannot compete in terms of production capacity or cost.
So, does this mean that the PRC is on track to be the dominant power of the 21st century? How airtight is the CCP’s control, and how accurate are Xi’s claims about the country’s ‘inevitable rise’? Or are there problems ahead, regarding environmental concerns borne of massive greenhouse gas emissions and lopsided economic growth?
Welcome to Observing China’s first ‘Tangram’, where we ask the leading China experts from the United Kingdom (UK) – and further afield – for their take on the PRC’s development. Our inaugural ‘Tangram’ answers the question many are asking: Will China dominate the 21st century?
Charles Parton OBE
Chief Advisor, China Observatory, Council on Geostrategy
All things are relative. Whether the PRC emerges by 2049 as the dominant global power – this is the intention behind meeting the ‘2nd centennial goal’, marking 100 years after the founding of the PRC – depends also on the performance of other powers, notably the US and European powers. If Donald Trump, President-elect of the US, succeeds in making America weak again, the European Union (EU) continues to shrink from tough decisions, and Britain cannot consolidate a post-Brexit position, then it will be easier for the PRC to dominate.
But the odds are stacked against the CCP. To be the number one superpower requires a strong, sustainable economy. Yet the economic and social model long ago became ‘unbalanced, uncoordinated, and unsustainable’, as Wen Jiabao, former Premier of the PRC, said in 2007, and Xi himself acknowledged in 2013. That model has caused – or must deal with – four major problems:
Debt, a real estate crisis and a broken system of local government financing (they are interlinked);
Demographics, a society which is very rapidly ageing before it has got rich;
A population inadequately educated and skilled for a hi-tech economy (the percentage of the working population which has finished secondary education remains low and will take decades to raise);
A lack of water, which is being exacerbated by climate change.
These and other problems, such as deteriorating foreign relations and increasing barriers to exports, would be difficult enough to surmount, but are made more so by a political system which is still largely set up to be run by top-down command and inspection. The CCP has deliberately eschewed elements which would help the economy be more ‘self-regulating’, namely:
A vibrant civil society. Ideas for change and pressure do not come from government bureaucrats.
Freedom of media, speech and the internet. The decade-long war on corruption is a monument to the lack of outside help. Instead, the CCP relies on inspections and cannot eradicate corruption among the inspectors.
An independent judiciary, which builds trust, an essential element in willingness to build for the economic long term.
Some form of political accountability independent of the Party itself: elections, in other words. Nothing encourages ‘serving the people’ more than the knowledge that the people can serve notice on you.
But these four elements, if introduced, would drive a wooden stake through the heart of the political model. And the one element of reform which the CCP will never allow is political reform.
The CCP accepts these limitations to its model as the price for staying in power. It is banking on dominance of the new sciences and technologies, and the industries which depend on them, both as a way of gaining geopolitical superiority and of ensuring the economic muscle to maintain it. Free and open countries need to be clearer about the CCP’s use of science and technology as a geopolitical weapon and to devise coherent strategies to deal with it. The tension between engagement with Beijing and protecting economic and national security against the PRC will be a dominant theme of the first half of the 21st century.
Isabel Hilton OBE
Member of the Advisory Board, China Observatory, Council on Geostrategy and Visiting Professor at King’s College London
The PRC will continue to be an important power in the 21st century, not least because of its size, economic heft and growing scientific and technological weight. Domination is a more complicated proposition, however, and relies on the effective deployment of both hard and soft power to frustrate the ambitions of adversaries and advance one’s own.
Xi’s New Year’s Eve speech stressed the PRC’s growing importance in the world but, notably, made little mention of the threat of climate change, which could hamper the country’s ambitions in two respects: first, the PRC is highly vulnerable to climate impacts at home. Its own national assessments point to sea level rise, intense heat waves and severe and frequent storms, droughts and floods, all of which would have severe economic and social effects. Over 150 million people live in low elevation coastal areas and several studies have warned that trillions of dollars of economic activity are at risk from sea level rise; agricultural production and food security are under threat and glacier retreat will impact the country’s hydropower sector and water supply.
Second, after nearly 20 years as by far the world’s biggest emitter and with per capita emissions now higher than most European countries, Beijing’s international position on climate change is increasingly open to challenge. The PRC presents itself as a victim of the climate excesses of the advanced economies. That narrative began to fray in 2005 when the PRC became the world’s biggest emitter. Today, as climate impacts multiply in scale and severity around the world, it will no longer serve.
A failure to take more robust action on climate will damage Beijing’s claims to moral and political leadership. This year, signatories to the Paris Agreement are required to offer enhanced Nationally Determined Contributions (NDCs) with the obligation to bring them in line with the agreement’s ambition to limit the global average temperature rise to well under 2°C. Beijing’s offer will come under closer scrutiny from the countries in the so-called ‘Global South’, whose interests the PRC claims to represent.
There are ways, however, for the PRC to mitigate some of these negative effects. If the US, under the second Trump administration, withdraws once again from the Paris Agreement, Beijing’s claim to leadership will be more plausible by comparison. And since the PRC dominates the production of low carbon technologies, it is well-placed to benefit from selling the solution, even as it continues to contribute to the problem.
George Magnus
Member of the Advisory Board of the China Observatory, Council on Geostrategy
The narrative of the PRC’s domination of the 21st century, sometimes self-servingly propagated by its main protagonists, is running into flak.
In the three years since the economic bounce in 2021, linked to Covid-19, the size of the country’s economy has barely changed, while the US, for example, has soared by 25%. Its GDP relative to the US has dropped from about 75% to 63%. Its share of world GDP has fallen from 18.5 to 16.6%. The PRC’s stock market capitalisation – or the value investors ascribe to all listed companies – has risen a bit since mid-2024, following a long slump, but at not quite US$12 trillion (£9.9 tillion), it amounts to around a fifth of the US.
‘Peak China’, defined in this way, has then already happened. While it is most likely that the PRC’s economy will grow in years to come, it seems likely to be held back by soft productivity, deflation risk and a weaker exchange rate. Its relative position may not improve that much, let alone surpass the US or dominate as per the narrative.
For a while, the PRC will retain its status as the world’s second biggest economy, and continue to be prominent in global manufacturing and exports, even dominating some specific industrial goods. Over time, though, Chinese industrial policies will encounter more resistance abroad, while its mercantilist trade policies, decoupling, and the recalibration of supply chains will lead to changes that most likely not to Beijing’s benefit.
The contrast between the PRC’s technological and scientific prowess and in some cases, global leadership on the one hand, and the persistent struggle to overcome systemic macroeconomic flaws, weaknesses, and imbalances on the other, is remarkable. While the former features persist, moreover, it would be churlish not to acknowledge the admiration and appeal the PRC commands among many emerging and developing nations, and indeed in a few developed countries too.
Yet, these dynamic sectors typically represent quite a small part of the overall economy, and their ability to have transformational effects more broadly depend on two things. First, managing and resolving the country’s structural problems, and second, the capacity of robust and flexible institutions to diffuse technological know-how and productivity growth throughout the economy. Under Xi, at least, there is scant evidence that the government is politically able or willing to address the macroeconomics issues, including debt capacity, weak demand and productivity, and deflationary risk, or at least is prepared to reform in ways that shift the distribution of political power in favour of private firms and citizens.
The PRC will doubtless continue to exert global influence, but its relative position in the world is likely to keep sliding, following Japan’s example over the last 30 years. Domination of the 21st century is more political rhetoric than economic substance.
Policy Advisor, Tony Blair Institute for Global Change
The PRC isn’t going to dominate the 21st century for one simple reason: it doesn’t want to.
We can, of course, talk about individual areas where Beijing dominates. It dominates supply chains in everything from critical minerals to consumer goods, and increasingly wants to shape the standards which will set the playing field for existing and emerging technologies. Increasingly, too, Beijing is looking to export its ideas as well as its products and carve out a stake in global governance.
But what actually are those ideas? The hallmarks of the PRC’s governance offer are concepts like ‘mutual non-interference’, a country’s right to define its own development path and, increasingly, ‘respect for the diversity of civilisations.’ In other words, Beijing’s offer is not a prescriptive one – nor is it a like-for-like rival of the Washington Consensus.
Even domestically, its leadership is making a similar case for plurality. Increasingly, the official story promulgated by the CCP of the country’s past and future is one of Chinese exceptionalism: the party line says that the PRC’s model is the unique product of the strengths of the Chinese population and its five thousand years of remarkable, often turbulent, history.
So, the thinking goes, while there might be practical lessons to share from the PRC’s rapid development (and Beijing is increasingly looking to share those through extensive ‘Global South’ training programmes), the unique blend of traditional Chinese, Marxist-Leninist, and state-capitalist influences that makes up the ‘China model’ itself will only ever suit one place.
The idea that the PRC’s system of governance is largely inapplicable beyond its borders appears to be a belief genuinely held among Chinese leadership – just look at the many cautionary tales of Western overreach in Chinese academic debates and state media. As the PRC sees it, the smart move is to focus on building an external environment amenable to Beijing’s interests, without getting bogged down in the high-risk, labour-intensive business of imposing specific models.
So, in short, Beijing isn’t looking to dominate the 21st century. But what we need to understand is that it certainly doesn't want the US to either.
Kevin Rowlands, Associate Fellow in Naval Strategy, Council on Geostrategy and Emma Salisbury, Research Fellow on Sea Power, Council on Geostrategy
This, of course, is a question of relatives not absolutes. For the PRC to rise to a relative position of dominance requires the US, the current global hegemon, to decline in relative terms. Readers may have conflicting views on the likelihood of American greatness being maintained, advanced, or lost.
If we tackle the question from one particular angle, that of naval power, then it may be easier to provide some objective analysis. During the quarter century following the end of the Cold War from 1990 to, say, 2015, there has been little doubt that the US Navy held the position of the world’s foremost sea power. It had unrivalled mass, high-end equipment, excellent sustainment, and a network of allies, partners and friends arguably unmatched by any country before or since. When Adm. Mike Mullen, then-Chief of Naval Operations, spoke of the ‘1,000 ship navy’ in 2006, it wasn’t pie in the sky. It was an (albeit exaggerated) moniker for the global maritime network that America led.
However, there is always a ‘however’. The PRC is rising. From the early 1980s onwards it embarked on an incredible naval modernisation programme, which slowly but surely, then rapidly and impressively, delivered results. In the 20 years up to the turn of the millennium, the People’s Liberation Army Navy (PLAN) started to extend its reach beyond the First Island Chain and develop command and control, missile, and electronic warfare technologies. From 2000 to approximately 2020, it went further to the Second Island Chain and occasionally beyond, underwent organisational reform, and shifted from large numbers of low-tech coastal defence ships to increasingly large numbers of sophisticated frigates and destroyers. It also procured aircraft carriers.
Today, the PLAN is the world’s largest navy and is not slackening the pace of its growth. It has high-end capabilities under, on and above the waters and is able to deploy globally. It has access to a huge fleet of domestically built commercial shipping too, much of which is specifically optimised to provide sealift capability in the event of a conflict. Is it a challenge to the US Navy? Categorically, yes.
This relative swapping of positions has been made possible because of two things. Simultaneously, Chinese maritime industrial capacity has expanded year on year, while US maritime industrial capacity has atrophied. And herein lies the issue. Can the PRC dominate the 21st century at sea? It certainly has the potential to do so, despite a current lack of experience and few if any real allies. Will it do so? That depends on America. If the US lives up to its word and recapitalises its domestic maritime defence industry and infrastructure, and if it maintains and enhances its global network of friends, then Beijing’s job will be made much harder. But these are big ‘ifs’ which require political and economic will in Washington and a sea-change in defence investment in other free and open countries.
Policy and Projects Officer, Progressive Britain
The question of whether the PRC will dominate the 21st century is neither new, nor one which we seem any closer to answering decisively.
Much political analysis in the free and open countries focusing on the PRC is split between the view that the CCP is becoming more aggressive, and the belief that Beijing is actually more interested in maintaining stability over anything else. What unites these views is that they overlook the other side of the coin – what we in the Euro-Atlantic countries can do to decide the direction of this century.
We must remember that liberal democracy is under threat; a weakened Russia and Iran positions the PRC as the leading force within the ‘CRINK’ – the acronym used by British intelligence to refer to the ‘deadly quartet’ of the PRC, Russia, Iran and North Korea. Additionally, Beijing’s popularity is growing across the Global South, particularly in Africa, fuelled by (initially) economically cheap but politically costly credit as part of the Belt and Road Initiative (BRI). We cannot afford to overlook these developments.
Too often in the Euro-Atlantic nations we fret over the actions of others and overlook the areas where we can respond proactively. We are significant actors in the dynamic landscape of international affairs. To assume the PRC’s dominance as an inevitability is defeatist. Nothing is a given, and we should embrace our capacity to effect change in a progressive direction. For example, autocratic states claim that human rights are fictitious. We need to counter this narrative by proving that human rights exist only because they are a concept worth defending, and that upholding them makes a nation stronger.
We should pursue strong partnerships with the countries of the ‘Global South’, particularly on matters of governance, development, and climate change, and leverage what remains of our soft power. When dealing with the PRC, free and open countries should present a unified front; as the US will soon learn, alienating allies and acting unilaterally undermines effectiveness during these interactions. Neither Trump nor Xi will be leaders forever. In only 75 years the CCP completely transformed the PRC following the century of humiliation – thus, nothing in the next 75 years is a certainty. So, to answer the question of the PRC dominating the 21st century – well, it is up to us to decide whether we will let this happen.
Grace Theodoulou – Policy Fellow, China Observatory
Email: grace@geostrategy.org.uk
If you would like to explore any of the Council on Geostrategy’s PRC-focused research papers, click here to visit the China Observatory.
Doru Costea, Romania
Congratulations for setting up the first tangram – and in the eve of the Year of the Wooden Snake, too, which is supposed to be a year of transformation, growth and introspection.
The first outcome of arranging the six tans – it does not matter their number is one less than the mandatory seven – is mostly inspiring, hence the following respectful comments:
1. To my mind, the answer to the question is fundamentally conditioned by the ability of the Communist Party to strike the right and sustainable balance between ‘domestic’ and ‘foreign’ factors. Mr. Parton’s remarks hit the mark, and the ‘home’ affairs are clearly addressed by Ms. Osman, while the ‘foreign’ ones are present in the lines of other distinguished authors.
2. The relevance of this balance is increasingly under pressure following the evanescing separation lines between home policy and foreign policy, albeit the final say remains deeply rooted in the national authority. As far back as the 19th Congress of the Party, Mr. Xi Jinping proclaimed that the ‘socialism with Chinese characteristics is blazing a new trail for other developing countries to achieve modernization’. This seems to be another ‘contrast’ to join Mr. Magnus’ one, as it emerges from China’s exceptionalism Ms. Osman rightfully highlighted. China’s foreign policy actually mirrors the domestic platform of the Party by virtue of the self-convincing exceptionalism.
3. The osmosis between the ‘domestic’ and ‘foreign’ policies is a general trend. It follows that more self-examination of one’s own challenges and failures, not China’s only, is strongly needed to successfully participate in the systemic competition. The tension Mr. Parton identifies as dominant theme of the first half of the 21st century includes the task to ‘embrace our capacity to effect change in a progressive direction’ in liberal democracies, as Mr. Pollard states, because the threat comes from within as well.
Thank you, again, and looking forward to next Tangrams.
Doru Costea, Romania, former ambassador to Beijing, now retired.
Many thanks for these perspectives. As a humble non-specialist, I found the contributions of Charles Parton, and Keven Rowlands and Emma Salisbury to be the most informative; apart from the latters' use of the ugly and unnecessary term 'sustainment'.
Ruby Osman's contribution was also most interesting, mostly because it defies what we know of the history of the past half-millennium. States which become economically powerful based on overseas trade, inevitably seek global dominance: Portugal, Spain, France, Britain, the United States. The fact that the PRC is rapidly building the world's largest blue-water navy, rather points to such an intent. All, of course, in defence of one's legitimate economic interests.
I am also puzzled at Ms Osman's reference to five thousand years of Chinese history. Who may one ask was the king of China in 3000 BC? Archaeology, legendary accounts such as the earlier chapters of the Shujing, and CCP propaganda, are not history.