FUTURES-DIAGNOSIS LTD

#463 China Works

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London SE1 7SJ

UNITED KINGDOM

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Fifteen years ago, many in China's political leadership were much less sanguine about China’s prospects than most Western commentators. The undoubtedly successful period since 1978 was nervously regarded as the exception rather than a new norm. After all, since the middle of the nineteenth century, China had only experienced humiliation and chaos.

 

But this has all changed. The key moment was the Financial Crisis of 2007-8. It was at this point that China’s leaders recognised that their economic success needed to be translated into political weight through the reorganisation of global institutions which no longer reflected the real balance of power in the world.  

 

The Belt and Road Initiative is a strategy to make China not only a regional but a global power and Xi Jinping’s enunciation of the ‘China Dream’ redefines the legitimacy of the party-state as a cocktail of Confucianism, a strong economy, and some welfare reform.

 

This is not to say that China does not have its own problems not least in the very shaky banking sector, an ageing population, and the real difficulty of embedding innovation and creativity in what is still a hierarchical and authoritarian society. China’s pre-eminence is by no means a foregone conclusion but national pride, not national shame is now the order of the day. Like it or not, China is going to have a huge impact on the global scene in the Twenty-First Century.

Understanding the dynamics underpinning China's resurgence is the first step towards future-proofing business strategies. What does this mean for businesses wanting to do business in, and/or trade with China? 

MISINTERPRETING CHINA

Bill Durodie writes about Lessons from the Huawei Debacle', published by the Institute for Policy Research at the University of Bath.

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