Exactly forty years ago, Deng Xiaoping took China by the reins and led it on a path of mass economic reform, dismantling the agriculture sector and encouraging foreign investment, reviving an economic system that had been stagnating for nearly five centuries.
Of course, such a rapid growth was, in part, due to the cheap labour market that was on offer, making China synonymous with sweatshops. After several years, the Chinese turned towards mass globalisation, expanding their horizons and ensuring they covered every inch of international trade.
Decades later, China has become a pivotal player in all sectors of industry.
Looking at the year ahead for China, they are in optimal economic shape. Last year, analysts brought light to numerous obstacles standing in the way of continual prosperity, obstacles which haven’t gotten any smaller: an ageing and urbanising population, pollution, an accelerating capital outflow, threats of a Sino-American trade war, mounting debt, and an inflating property bubble.
Despite all these looming issues, China remains on track to achieve its target of doubling its GDP between 2010 and 2020. Last year GDP grew 6.9%; compare that to the US’ growth rate, which hovers around 2%, and one might assume that China’s economic output is set to continue multiplying ad infinitum.
However, since 2010, China has been witnessing a regression in annual growth – from 10.6% down to 6.7% in 2016. Juxtapose that with the early 90s when growth was over 10%, the Chinese economic organism is becoming more resistant to the anabolic steroids that we call fiscal policies.
So what now? Chinese officials have changed their course of action and from 2021 onwards, they will be primarily focused on quality, not quantity. In doing so, they are mapping out a long-term plan, one which could drive China to the forefront of the world stage by 2050.
Stepping up the ‘war on pollution’, China is making attempts to position itself as the world’s driving force for renewable energy, with investments for mass-scale projects in 2017 totalling $44 billion, up 27% from the previous year. With the United States in the process of withdrawing from the Paris Agreement, China’s ambition stands to reason
Though it may seem that China is trying to do a good deed for mother nature, there is a clear ulterior motive, particularly with regards to the future of the geopolitical scene. Many are predicting a significant year for renewables, particularly with regards to battery, solar and wind technologies – what is interesting is that these are the fields which China have been targeting.
Whilst we are still in the early stages of renewable technologies, those who dominate the market will carry the responsibility of directing development and the future of consumption, production and industry. With the popularity of renewable technology increasing, China is looking to invest in becoming the future of energy, whilst their main trade rival, the United States, returns to 1679 as if it were rediscovering its first coal deposit.
Beijing has also announced plans to construct a $2 billion AI research park as they look towards becoming a world leader in the artificial intelligence industry by 2025. The park is designed to house up to 400 businesses, and estimated to turnover 50 billion yuan (£5.6 billion) annually.
China’s rapid expansion in the AI industry is fuelled by the ongoing race between itself, Russia and the United States to explore the militarisation of artificial intelligence. Imagine the future of the US military lying in the hands of one of its rivals.
As with renewables, AI is another market of the future and those who scramble to sow their seed in the market now, will repeat the fruitful rewards for the many years to come. With this in mind, it’s no wonder that China is looking to increase its investment in the industry to 400 billion yuan (£45 billion) by 2025.
Of course, one cannot forget the Chinese Lunar Exploration Program (CLEP) and China’s ambition to land on the far side of the moon – something which its spacefaring rivals have yet to accomplish. If the Chinese can accomplish this revolutionary lunar mission and offer us a view of the radio universe without terrestrial interference, they will have reshaped the frontier for future space exploration and investigation.
So, whilst the Middle East bathes in its innumerable geopolitical issues, whilst the US fails to come to grips with its indecisiveness on both foreign and domestic policy, and whilst Europe is preoccupied by its migration crisis and the inevitability of Britain leaving the EU, China will continue to progress at an alarming rate – dominating the future market sectors and earning itself the international respect it deserves.