So called “Peak China” is simply a Western campaign for China to commit economic suicide
Foreword:
China Environment News
A few days ago the European Union announced it would launch a subsidy investigation into Chinese wind turbine suppliers in several EU countries, as the bloc steps up trade protectionism against China’s new-energy industries – the fourth such “investigation” of Chinese industries by the EU within two months. The Global Times points out that these moves have the clear aim to target China’s green, new-energy manufacturers. The West’s claim of Chinese “overcapacity” in renewable energy is yet the latest example of fake news and attempts, led by the USA, to pressure China to commit “economic suicide” by adopting policies which will drastically slow China’s economy. The linked article by John Ross from Renmin University of China deals with this issue in depth.
Despite the fact that China’s economy continues to far outgrow all major Western economies, the Western media is energetically promoting a myth of “peak China”—i.e. that China’s economy either has or is about to drastically slow down.
But examination of such assertions shows that they are either:
- “Fake news”, claims which are factually false or are alleged to be about to occur due to completely unexplained processes, or,
- Are based on the hope that China will commit “economic suicide”—by adopting policies which will drastically slow China’s economy.
This article analyses the errors in both claims. This then allows well-known genuine issues which face China’s economy to be assessed in a balanced way—these are real, and must be dealt with, but unless major economic mistakes are made will not lead to a sharp slowdown and failure of China to achieve its economic goals.
The real facts of international economic performance
Starting with the current situation, the fundamental facts of China’s economic growth in terms of international comparisons in early 2024 are the following—the details were given in an earlier article, “China’s economy far outgrew the U.S in 2023—but the U.S. was world leader in creating ‘fake economic news’”.
In 2023 China’s economy grew more than twice as fast as the U.S. and around five times as fast as most G7 economies.
- In the period since the beginning of the pandemic China has far outgrown all other major economies—growing two and a half times as fast as the U.S., five times as fast as Canada, and around seven times as fast as the other G7 economies.
- China’s growth is on target to achieve its strategic goal of doubling GDP and per capital GDP between 2020 and 2035.
Evidently the facts of this economic growth situation have not only domestic but huge international strategic implications. If China’s and the U.S.’s present medium/long term GDP growth rates continue—China’s at around 5% a year and the U.S, at slightly over 2%—then between 2020 and 2035 China’s economy will grow by 100% and the U.S by approximately 40%. In that case, China will become both a high-income economy by World Bank international standard and by 2035 a significantly larger economy than the U.S.. For the U.S. capitalist class, which thinks of the world economy as zero-sum game in which the U.S. must maintain unilateral domination, such outcomes are completely unacceptable.
But, in dealing with this this peaceful economic competition, the U.S. has proved incapable of raising its own long-term growth. On the contrary, as Figure 1 shows, annual U.S. economic growth has been falling for seventy years, declining from 6.1% in 1953, to 4.4% by 1969, to 3.5% by 2002, and 2.1% by 2023. Therefore, as the U.S. has demonstrated inability to raise its own growth rate, the only way that it can outcompete China is by slowing China’s economy. This is, therefore, the purpose of the U.S. launching anti-China tariff wars, chip wars, the intense propaganda campaigns of “fake news” to attempt to dissuade foreign companies from investing in China etc. This U.S. response against China was predicted in advance in my book 一盘大棋:中国新命运解析.
Systematic international comparisons make clear that any balanced judgement shows that despite these real questions China’s economy is continuing to far outperform all other comparable, and in particular Western, economies. Any objective assessment of China’s economy must therefore start from this fact —which is why the U.S. is so keen to attempt to create “fake news” to attempt to conceal this reality.
- The above is a short extract from an excellent and detailed article by John Ross. We recommend reading his full article.
John Ross is an economist and a senior fellow at Chongyang Institute for Financial Studies, Renmin University of China.
The article in the Monthly Review Online is a shortened version of that which originally appeared in Chinese at Guancha.cn.
Source: Monthly Review Online, Apr 20, 2024. https://mronline.org/2024/04/20/so-called-peak-china-is-simply-a-western-campaign-for-china-to-commit-economic-suicide/