Eleven years before the epochal events in Germany, a seismic change was taking place in China

It is, of course, common sense that 1989 was the defining moment of the last quarter of the 20th century. Who could possibly disagree? It closed a chapter of history that had been ushered in by the October revolution in 1917. It brought to an end the systemic challenge that communism had posed to capitalism, the belief that there was, indeed, an alternative. It allowed the United States to emerge as the undisputed superpower of a new century. It gave globalisation access to the former Soviet bloc from which it had been excluded: henceforth, globalisation could live up to its name.

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China’s opposition to action against Iran shows how it is increasingly at odds with the United States. It is a shame Washington hasn’t noticed.

There is a fascinating difference between the international diplomacy on Iran as compared with that on Iraq prior to the invasion. The opposition to the Anglo-American action was led by France, with somewhat muted support from Russian and China. Indeed, China remained as quiet as could possibly be. Nearly four years later we are in very different waters. The opposition in the United Nations is being led by Russia and China with France on the opposite side.

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For the sake of all of us, Hu Jintao and George Bush need to get on

The meetings between the US president and the Chinese president are now the most important events on the international calendar. The former represents the most powerful country in the world, while the latter represents the second largest economy and the next superpower. They need to meet and, for the sake of us all, they need to get on. But the mood music surrounding this latest meeting is a reminder that there are growing tensions and conflicts in the US-China relationship.

The issue that most preoccupies is economic. There is mounting pressure within Congress for tariffs against various Chinese imports, together with demands that China revalues the yuan. The problem is not China. It is the fact that the dollar is seriously over-valued. Nor will tariffs mean that the US will make the goods that China now exports. The real problem is not China but the fact that the US economy is living beyond its means with its huge budget deficit and trade deficits. These economic tensions, however, aren’t going to go away. On the contrary, they seem likely to grow more serious.

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The disastrous foreign policies of the US have left it more isolated than ever, and China is standing by to take over

‘Our power, then, has the grave liability of rendering our theories about the world immune from failure. But by becoming deaf to easily discerned warning signs, we may ignore long-term costs that result from our actions and dismiss reverses that should lead to a re-examination of our goals and means.”

These are the words of Henry Hyde, chairman of the House international relations committee and a Republican congressman, in a recent speech. Hyde argues that such is the overweening power of the US that it may not hear or recognise the signals when its policy goes badly wrong, a thinly veiled reference to Iraq. He then takes issue with the idea that the US can export democracy around the world as deeply misguided and potentially dangerous. He argues: “A broad and energetic promotion of democracy in other countries that will not enjoy our long-term and guiding presence may equate not to peace and stability but to revolution … There is no evidence that we or anyone can guide from afar revolutions we have set in motion. We can more easily destabilise friends and others and give life to chaos and to avowed enemies than ensure outcomes in service of our interests and security.”

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The rapidity of the Asian giant’s rise is overturning western received wisdom about politics and the shape of the global future

The past two or three years have marked a new moment in the global perception of China. There is suddenly a new awareness that encompasses both a recognition of China’s economic transformation and an understanding that, because of its huge size and cohesive character, it will have a profound impact on the rest of the world, albeit in ways still only dimly understood. Until recently, China’s economic rise always seemed to be qualified by the rider that something was likely to go amiss – a rider that is now rarely heard. China has arrived and will increasingly shape our future, not just its own.

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Japan is stuck in its past, and its refusal to come to terms with it threatens to define its future and that of the whole of east Asia

The past year might be described as the moment time of China’s rise. Of course its rise long predates these years, but this fact has suddenly been recognised worldwide, well beyond the global elite. It is now part of the popular common sense, not simply in Europe but everywhere; indeed, Europe has been relatively tardy in this process. The buzz surrounding Hu Jintao’s visit is part of this picture. The phenomenon is even evident in China itself, where the past two years have seen a much wider awareness of both the fact and implications of the country’s rise. In the face of this changed consciousness, it is inevitable that new stances will be adopted and new policy positions struck around the world. This is already happening in Japan, notwithstanding its typically understated tone. Developments there can only be described as ominous. While Europe still thinks of itself as somehow central to the future, east Asia is where the future will be played out. It is in that context that we should see the import of current trends in Japan.

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Now that Mammon has replaced Mao, corruption is fuelling the rural inequality opened up by migration to the cities

The case of Lu Banglie, who was beaten up by a mob near Taishi in southern China – as reported in yesterday’s Guardian – is not unusual. There has been a rapidly growing number of conflicts between villagers and the authorities, often over the sale of agricultural land on the edge of a town or village to a developer. These conflicts are a graphic illustration of the tensions involved in China’s transformation. The essence of industrialisation is the shift from the countryside to the towns involving, in China’s case in particular, a huge migration to the urban centres. The cities and towns are growing apace and gobbling up the adjoining land in a ceaseless process of expansion.

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The defeat of colonial rule will come to be seen as the defining event of the 20th century

What was the most important event of the 20th century? The answer might once have been 1917. More recently, the favourite has been its historical nemesis, 1989. The different vantage points offered by history provide different perspectives and, as a consequence, different judgments. What might seem incontrovertible to one generation appears less obvious to the next, and perhaps not at all obvious, even perverse, to the one that follows.

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US v China will soon be the dominant fault line of global politics

Ever since 9/11, the US and China have been rubbing along nicely. The US needed China’s support in the war against terror and China is anxious to create the best conditions for its economic growth. But how long will this latest honeymoon last? A string of recent announcements coming out of Washington suggest that the Bush administration may be adopting a rather more abrasive position.

First, China was attacked for the huge wave of textile imports that followed the lifting of the global quota agreement at the beginning of the year, a decision the US had 10 years to prepare for. The US has now imposed quotas on Chinese textiles, as has the EU. Meanwhile the US treasury has demanded that China revalue the yuan within the next six months, describing its currency policies as “highly distortionary”. In fact, even if China does revalue the yuan, it will make precious little difference to America’s huge current account deficit; moreover China’s own current account is broadly in balance, suggesting that the case for revaluation is hardly overwhelming.

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As Japan has shown, and China will too, the west’s values are not necessarily universal

Not so long ago, Japan was the height of fashion. Then came the post-bubble recession and it rapidly faded into the background, condemned as yesterday’s story. The same happened to the Asian tigers: until 1997 they were the flavour of the month, but with the Asian financial crisis they sank into relative obscurity. No doubt the same fate will befall China in due course, though perhaps a little less dramatically because of its sheer size and import.

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Updated and expanded new Chinese edition just released.


Turkish edition just published!

When China Rules the World is the first book to fully conceive of and explain the upheaval that China’s ascendance will cause and the realigned global power structure it will create.

New edition available now from:

Amazon UK
and all good booksellers.

US second edition is available now via: 

Amazon US