The future of China's economic growth: domestic and international perspectives

• Author: Barbara Materi
• Pages: 29-45

Abstract

The aim of this nal paper is to analyse China’s international relations between

the other countries, especially the ones that form BRICS, and to give an answer

to an actual and recurring question: is China going to predominate the global

scene?

Key Words

China; BRICS; Economic growth; International relations

Resumo

O objetivo deste TCC é analisar as relações internacionais entre a China e

os outros países, especialmente aqueles que formam o BRICS, e de fornecer

uma resposta a uma pergunta atual e recorrente: a China irá predominar no

cenário global?

Palavras-chave

China; BRICS; Desenvolvimento econômico; Relações internacionais

Introduction

China’s international relations is a very current subject, since as the world’s sec-

ond largest economy after USA, China is constantly growing and widening its in-

uence around the globe. In addition, a new study by PriceWaterhouse Coopers

forecasted that China’s economy will be bigger than America’s before 2030.1

To understand and give an answer to the question “where is China going in

the future?”, I opted to start talking about BRICS, analysing the main achieve-

ments of this country in relation to other world’s economies, and concluding

with the New Silk Road plan presented in May 14th 2017.

THE FUTURE OF CHINA’S ECONOMIC GROWTH: DOMESTIC

AND INTERNATIONAL PERSPECTIVES

BArBArA MAteri

30 REVISTA DO PROGRAMA DE DIREITO DA UNIÃO EUROPEIA

1. China and BRICS

It’s been just over a decade since it appeared, for the rst time, a bizarre term on

the international economic scene, the “BRIC”. The idea of this term — that, in fact,

is an acronym formed by the initial letter of four distinct words — is referred to

Jim O’Neill, chief economist for the Goldman Sachs Investment Bank who, in 2001,

in a technical report called “The World Needs Better Economic BRICs”, identied

four countries whose economies were rapidly rising candidates, in the near future,

to dominate the world market. O’Neill speculated in this regard, that in a few years

the gross domestic product (GDP) of these countries, in as a whole, would have

grown to the point of reaching that one of the economic powers expressed in G6

(US, Japan, UK, Germany, France, Italy). These countries are Brazil, Russia, India

and China (hence, in fact, the “BRIC” acronym). By now, the BRIC entered strong-

ly into the statistics of the strongest competitors in the international arena, leav-

ing behind, just saying, the condition of “emerging economies”. More recently, the

quartet has added a new power, the South Africa, so the BRIC became BRICS.

At present, the geo-economic weight of the BRICS is impressive: they oc-

cupy 30% of the land, they have 43% of the world’s population and 21% of the

GDP of the planet. Their agricultural output is 45% of the total, while goods and

services represent 17.3% and 12.7%.2 Their aggregate GDP exceeds $ 32 trillion

and has increased by 60% compared to the time of their establishment.3 They

are constantly growing, despite the inevitable reverberations of the Western

crisis, speculative bubbles and the many “unconventional monetary policies”

put in place by central banks.4

The BRICS supporting structure was initially formed by the Asian triangle

formed by India, China and, above all, Russia, which in 2002 promoted co-

operation between these countries. When it was evident that the limited range

of action of a fundamentally Asian alliance was unable to expand its inuence

and its attractiveness to alternate poles in western hegemony and, in particular,

in the United States, it required the aggregation of other powers of other con-

tinents. The rst was Brazil, which was the largest power of the Latin American

continent, and the fourth emerging world economy, followed by South Africa,

under pressure from China, which had in the meantime achieved strong eco-

nomic and diplomatic penetration in Africa.

The BRICS strategy for achieving the economic objective, characterized

by the lack of territorial contiguity, promotes and combines intersectoral and

variable geometry initiatives across the world. Among the goals: the creation

of a new monetary system, the realization of major development projects, and

the strengthening of its role in international organizations.

All this has allowed the group to gain greater geographical representative-

ness, accentuating its dynamic and multipolar character, but it would not be