China is in the midst of a monumental economic transition. The country found great success driving its manufacturing sector to the limit – and for decades, it worked.
The world absorbed Chinese exports at an astonishing rate, inciting an unprecedented expansion of China’s economy. This, however, could only last for so long. Prompted by the global financial crisis, Beijing began shifting its economic strategy from a manufacturing-driven model to one that is based upon high-quality, sustainable growth.
But while China’s economy progresses, its political system seems to be heading in the opposite direction. On March 11, the ruling Communist Party eradicated presidential term limits.
Consequently, instead of stepping down in 2023, China’s president, Xi Jinping, could remain in charge – and arguably one of the most powerful people in the world – for the rest of his days. In making this decision, China has made the unfortunate and oft-irreversible first step towards a dictatorship.
China has made the unfortunate and oft-irreversible first step towards a dictatorship
This isn’t just major news for the people of China; it also puts a spanner in the works for the global economy. Since the end of the Cold War, the West has strived to integrate China into the international framework, as demonstrated by Beijing’s admission to the World Trade Organisation (WTO) in 2001.
The intended outcome was a China that operated in accordance with free market principles. The hope was that, as its population became wealthier, the tenets of democracy would follow.
This ideal, however, seems increasingly unattainable. Aside from March’s constitution change, numerous other moves further enforce the notion of a superpower that not only marches to the beat of its own drum, but pushes its weight around too.
In the past, for example, China has cut off imports as a means of political retaliation – as was the case with Japan in 2010 and the Philippines in 2012. Meanwhile, its WTO membership has backfired.
A report presented to the US Congress in January stated: “It is now clear that the WTO rules are not sufficient to constrain China’s market-distorting behaviour.”
Given the West’s failed bet and China’s moves towards despotism, international players must now rethink their strategy. Taking a stronger stance against Beijing’s bullying tactics is perhaps the first port of call.