1024px-View_of_Beijing

China is fearful of becoming the world’s leading economic power and does not want to overtake the US. That’s the argument Kai He, Associate Professor of Political Science at Utah State University, has put forward in an article for the RSIS Commentaries on June 2, in which he suggests three reasons why China “doesn’t want to be number one”.

A major report back in May that suggested that China’s economy will overtake that of the US this year was met with opposition from an unlikely source: Beijing itself. A message published by China’s state media questioned the accuracy of the report, which was based on World Bank figures, and discouraged people from “reading too much into it”.

But why would Beijing refute the suggestion that it will be the world’s leading economic power before the year is out?

The prediction of surpassing the US follows the news that for the first time, China now has the world’s three biggest public companies, and five of the top 10, according to the Forbes Global 2000 List released in May.

▼ Industrial and Commercial Bank of China, the biggest public company in the world.

800px-INDUSTRIAL_AND_COMMERCIAL_BANK_OF_CHINAWikimedia/陈少举

Both these facts were widely reported around the world. However, in an article in the state-run Global Times, Beijing argued that measuring the relative size of the economy using the purchasing power parity index (PPP) gave an inaccurate measure of China’s growth:

“The size of developing economies will be usually bigger when assessed in PPP terms instead of market exchange rate … Although China has surpassed the US in certain economic spheres, the quality of the Chinese economy is far worse than that of the US.”

In his essay “A Tale of Three Fears: Why China Does Not Want to Be No.1”, Kai He gives three reasons for this uneasiness on the Chinese government’s part. First, he argues, using the GDP index to make these kinds of predictions leads to the artificial inflation of Chinese power. China’s GDP may be enormous, but it also has a population of 1.3 billion, which dilutes this figure considerably. According to the World Bank, per capita the country’s GDP is only 91st in the world – that puts it behind the Dominican Republic, for example.

Bddo1SDCUAEflLG.jpg_large Twitter: @veterantraveler

Second, if China becomes the number one power, this will bring with it a great deal of international pressure. The policy implications, Kai He argues, would be hugely significant, since “with great power comes great responsibility”. In 2005 Robert Zoellick (then Deputy Secretary of State) urged China to become a “responsible stakeholder”, a pressure from the US that continues to be maintained today. The international community will expect more from a China that is the biggest power in the world than from one which is catching up in second place.

The third fear is increasing nationalism. While well-controlled patriotism is of course beneficial for the Chinese Communist Party, Kai He says there is anxiety that if not controlled, this “potential burgeoning nationalism” could backfire on the government. He cites as an example Chinese netizens’ recent online criticism of the government over their handling of territorial disputes, including the South China Sea.

Although the government rejects the studies that suggest China will become the biggest economy in the world this year, they aren’t questioning that it will happen at some point. As the state media report stated, “China will become the no.1 economic power sooner or later, which is an irreversible trend.” The impact of this change on international relations, however, looks to be much harder to predict.

Sources: Eurasia Review, Xinhua JPGlobal Times, The Economist
Top image: ahenobarbus/Wikimedia