8 - The Power Game in Asia

Summary

China Versus the US Regional Powers

An objective of superpower grand strategy is to be seen as strong enough to win a major war, thus precluding the need to actually fight. To make such a policy credible in the eyes of rivals and challengers, the financial strength of the power needs to be solid enough to sustain a protracted war. This includes keeping trade routes open, as a superpower cannot rely over the long term on its domestic resources and production capacity alone. China and the United States have pursued grand strategies that are similar in purpose, but the economic structures, geography and financial constraints limit the global ambitions for each.

Economically, China is much more dependent on access to the global economy than the United States is. China cannot feed itself— the United States is a net exporter of food. China is the largest net importer of fossil fuel—in a couple of years the United States will be a net exporter. China's share of exports/imports to GDP is around 18 per cent—for the United States the figure is around 12–14 per cent (on account of the deficit in the balance of payments, the figure is higher for imports than for exports). According to the OECD, China's outward FDI stands at 14 per cent of GDP and its inward FDI at 21 per cent—the corresponding figures for the United States are 32 per cent and 36 per cent. The United States has been a global investor (outward and inward) for more than a hundred years—China has only participated in this for a couple of decades, which illustrates how quickly China has been building an international investment position.

Geography requires that continental and maritime superpowers react differently to this quandary. A continental superpower, like the former Soviet Union, relies on its neighbours for overland transport links— railways or trucks. A maritime superpower may operate independently of adjacent countries, but it must keep sea lanes open, doing so by naval power.

History does not have any examples of a successful continental superpower operating on a global scale. The closest would be the Roman Empire, extending from present-day Iraq to Portugal and North Africa to the lower Rhine in AD 117.