The recent slowdown has called previous narratives about China’s rise into question for some. How should we view this economic slowdown? What role will the US play? Global Times (GT) London-based correspondent Sun Wei interviewed Martin Jacques (Jacques), a senior fellow at the Department of Politics and International Studies, Cambridge University, and a visiting professor at Tsinghua University, Beijing, about these questions.

GT: Nobel Prize winner Joseph E. Stiglitz claims in an article that the “Chinese century” has begun and that Americans should take China’s new status as the No.1 economy as a wake-up call. Professor Joseph Nye of Harvard University explains in an essay why the “American century” is far from over. Obama said last year the US will lead the world for the next 100 years. What do you think of these debates?

Jacques: The US is still the dominant power in the world in probably every sense. China is only challenging it economically by virtue of having a huge population. China’s rapid transformation is clearly already having profound economic consequences, and beginning to have serious political, cultural, intellectual, moral, ethical, and military consequences as well. That’s in a way what President Xi Jinping‘s government represents. The Chinese dream imagines a different place in the world and a different future for China.

As American scholar Lucian Pye once famously noted, “China is a civilization pretending to be a state,” forced by its weakness at the end of 19th century to adapt to the European norms of the international system. Now that era is coming to an end.

China has a lot of thinking to do about its future. What this represents is the beginning of a more comprehensive shift in global power from the US to China. It’s going to be a long drawn-out process.

By 2019, according to the IMF, China will be 20% larger in GDP measured by PPP compared with the US. All of this suggests something very profound is happening. We know that when countries rise, they are driven economically. At the same time, that leads to the development of much wider cultural, intellectual, military influence. I agree with Stiglitz on this in a broad sense.

GT: What did you think of Chinese President Xi’s recent meetings with his US counterpart Barack Obama?

Jacques: The more they talk, the better. It creates some understanding. All the preparation and exchange between two sides, and all the kind of media stuff before and after, helps to generate more understanding and discussion in the US about China. These kinds of things are very important. The underlying problem between the US and China is that the nature of the relationship has changed. When it started in 1971, the US was hugely larger and China was much weaker. It was extremely unequal. China was a long way behind. The US was the gate keeper of the whole international system, so China needed to win the support of the US to be admitted. Today that relationship is no longer so overwhelmingly unequal, the US is no longer dominant in the way it was.

The US view about the world is based on the idea that the US enjoys primacy in any relationship. The rise of China clearly represents a challenge to this. The situation is changing especially in East Asia. With the pivot, the US is trying to find a way of reinvigorating its position in East Asia. The US, nonetheless, in time, will have to accept a more equal relationship with China in East Asia.

GT: How do you see the future of the international system?

Jacques The world is now very different. The developing countries account for 85 percent of the world’s population. The developing world is becoming enfranchised in a way that it was previously disenfranchised. Globally, the rise of developing world led by China is going to profoundly change the world order.

By 2030 it is widely projected that the Chinese economy will be twice the size of America’s. The international system is going to become very different. The decline of the developed world and the rise of developing world mark the end of Eurocentrism. We are going to witness a huge change of a global system which has been dominated by western-created organizations.

GT: How should we regard China’s economic slowdown under the “new normal?”

Jacques: China is seeking to make a shift from its established economic model to a new one. It will take time to make that shift. The sooner it is addressed, the better. It was delayed because of two reasons. To reform, you need to overcome the domestic political procrastination. The second problem is the Western financial crisis. The collapse of Western markets following the Western financial crisis meant that China had to find new forms of demand to compensate, hence the stimulus program, which was the correct response. But the stimulus program inevitably led to new imbalances and new problems, most notably a series of new bubbles and a mushrooming of debt. As a result, China is faced with two difficult challenges at the same time: dealing with the short-term consequences of the stimulus program and, more importantly, making a fundamental shift in the nature of its economic model.

It’s a difficult situation and a new territory for the Chinese leadership. I have basic confidence in the intelligence of the Chinese leadership in handling economic problems. It doesn’t mean that they don’t make mistakes, but they have a fantastic record. It’s true they are in uncharted waters now. The growth rate is going to be slower and they must adjust to a different form of growth.

GT: Britain and China are getting closer. But Europe on the whole is still dependent on the US in terms of diplomatic policy and security policy. What is the role of the Europe on the world stage in future?

Jacques: Europe is declining in terms of influence, and that trend is going to continue. The population of Europe is declining; the economy is in a mess. There are deep problems within the EU.

What you are going to see is in general a process of fragmentation, a breakdown and erosion of Western identity. Take theAIIB for example. After WWII, Britain didn’t have an independent defense and foreign policy. The UK’s policy has been deeply intertwined with the US.

But something quite extraordinary happened with the AIIB. Britain, as the first non-Asian country, joined the AIIB. This was a brave move, which was taken in the face of American opposition. It was based on the belief on the part of the British government that China is going to become economically hugely important and therefore that Britain needed to establish a much closer relationship with China and that it needed to conduct a more independent policy towards China. The Western iceberg is beginning to crack. Everyone is pivoting to China — Russia, Germany, and France. We are only seeing the beginning of it.

GT: Europe is experiencing the most severe refugee crisis since WWII. The West and Russia are criticizing each other on the Ukraine crisis. Now the tension is also being seen in Syria. Do you think the US and China can play a role in addressing these tensions?

Jacques: It is clear the US is losing control in the Middle East. The tipping point was the intervention in Iraq. They completely screwed it up. The American order in the Middle East is unraveling very quickly.

I am not a great supporter of Russian foreign policy. But Russia has been very badly treated by the West. After the breakup of the Soviet Union, the West treated Russia as a defeated nation. Western policy was what I call Versailles-lite. It denied that Russia had any legitimate interests. Russia is now trying to find new ways forward. Russia has become much closer to China. Russia is now the biggest supplier of oil to China.

Xi and Putin enjoy good relations. This is a very important strategic development. Of course, Russia and China are very different in the way they behave. Russia is more aggressive, outspoken, and more inclined to conflict, and China is more cautious, understated, and very disinclined to using force.