Tuesday, July 07, 2015

Is China Really Strong as Broadly Percieved?

The rise of China is one of the top issues among the students of international relations. At various international conferences, pundits from all over the world say that we must accept the ascendency of this emerging giant and its “Manifest Destiny” for greater leverage in global issues, regardless of their nationalities, whether Americans, Europeans, Asians, or Japanese. Some of them even argue so passively as to say that established powers like us accept the decline without resisting the trend of global power transition. It sounds very Buddhist to accept the impermanence of all things and whatever happens, whether desirable or undesirable. But in a Hobbesian world, when a state leader takes such self resigned attitude, his or her country will fall into at the mercy of an ambitious emerging power. We have to make a proper assessment of the power of the challenger, and think of the strategy to manage it.

After all, is China really strong, as many pundits and people say? There is no doubt that this country is a rising giant, which could have substantial impact on the world order and global security. But should we assume China an economic giant? For this question, we need to note ambivalence of its economy, extremely huge total size but disproportionately low per capita income. According to 2014 gross national income per capita ranking by the World Bank, China is merely 101st in the Atlas method, and 105th in purchasing power parity. Quite often, businessmen are so impressed with rapid economic growth and urban development that they are infatuated with a rising China like former Japanese Ambassador Uichiro Niwa who was the Chairman of C. Itoh & Co., before entering diplomatic service. The gross size of the Chinese economy is almost dependent on its huge population. A world economic power in poverty has been unprecedented in history, from Spain, the Netherlands, France, Britain, Germany, the United States, to Japan. That makes it extremely difficult to grade the real economic strength of China. After all, it is utterly absurd to assume that China is the foremost and a formidable economic rival to the United States. Actually, it has not overtaken Japan and major European powers. China is even far poorer than Russia. Is China surpassing the United States in the near future? But when?

I wonder why pundits from all over the world dismiss such a simple fact, regardless of their national, cultural, and career backgrounds. The danger of such mis-evaluation of the Chinese power is that the Beijing Communist Party can harness psychological illusion to suppress international norms, in order to win more advantageous positions. It seems to me that eminent people know so much in depth about China as to put aside the basic and simple fact that I mention here. The receptive attitude to the Asian Infrastructure Investment Bank is a typical case of “Buddhistic” appeasement to China’s pushy self claim for the apex great power in Asia. Besides concerns with social and environmental consideration, I can hardly imagine that China has any know how or expertise to manage a multilateral organization. This country has never led regional organization, nor security alliance. It has been isolated from the Western, the Soviet, and the Nonalignment blocs. There are not so many renowned Chinese economists to run a multilateral development bank. Furthermore, can a poor country afford to manage a multilateral bank virtually in a unilateral way? We must understand China’s aspiration to win respect from the United States, Japan, and the global community, but their competence to run a multilateral financial organization is questionable.

Another point that we must question is manufacturing. China is called the world factory, and their competitiveness in low value added products and consumer goods is indisputable. But when it comes to high tech products, China is not a top runner. PLA fighters are mostly copies of the Russian Air Force ones. For example, J-11 is from Su-27, and J-15 is from Su-33. Even China’s indigenous stealth fighter J-31 uses the same engine as that of MiG 29. Actually, Chinese engines are old and weak (“Why China’s Air Force Needs Russia's SU-35”; Diplomat; June 1, 2015). Though J-31 is supposed to be a hacking copy of American F-35, its performance at the Zuhai Air Show in 2014 was graded terribly (“Even Chinese Media Bashed Immaturity of the PLA’s Latest Stealth Fighter”; Iza Sankei Digital; December 17, 2014). However, imitation is no more than imitation, whether legitimate or illegitimate. An interesting example is a German technological transfer of Type 214 submarine to South Korea. Though Koreans were admitted license to build an advanced German submarine, they failed in it, because their bolt connection technology was not developed enough. In other words, technological imitation without a fundamental level of engineering is something like a layman’s cuisine simply dependent on a recipe written by a super cook. Therefore, whether by license or hacking, copied technology is not real technology.

In addition to fighter planes, China’s missiles are also dependent on Russian technology, either imported or copied. In advanced technology, China is so dependent on Russian and hacked American technology. This implies that China’s manufacturing base is extremely poor. In terms of the economy, China is not an irresistible rising power, and it is far from overtaking America, Japan, major European nations, and Russia. The vision of G2 is a daydream. Nor is China a military superpower. China is just a gigantic underdeveloped power. Quite a few people believe that China will make a “declining” Russia their junior partner. That is hardly foreseeable. Applying Susan Strange’s theory of structural power, I would argue that it is Russia that exerts the power to determine the vision of defense, not China. Dependence on Russian technology makes China’s defense system, accordingly. From this point of view, I am impressed with the final line in the article by Kenichi Ito, President of the Japan Forum on International Relations, “Nevertheless, Chinese President Xi Jinping came to such a ceremony, and I wonder whether it was good for China. I am quite doubtful of it”, regarding Xi’s visit to the 70th VE Day ceremony in Moscow (“Putin’s Rule and Russia’s Path to the Future”; JFIR Commentary; May 27, 2015).

Consequently, I would like to ask a question again. Why are pundits from all over the world so receptive to the rise of China, and tolerant to their “decline” in the global pecking order? Buddhistic self resignation is not an attitude of policy making. If there is something undesirable, we have to make it desirable. If there is something desirable, we have to make it more desirable. For this objective, we must make an assessment of the real strength of China, without fear or favor.