For several years, Chinese officials have been talking about “changes unseen in a hundred years” without elaborating what they have in mind. Looking at the drastic changes to the world order since Donald Trump returned to the White House, one can only conclude that the Chinese have spoken with uncanny prescience.
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There have indeed been many changes to the international system in recent years, starting with a rapid deterioration of US-China relations since Trump’s first term as US president. A body of opinion was formed in political circles that China was taking advantage of America and embarking on a “hundred-year marathon” to supplant the US as a global leader.
To contain China’s rise, tariffs, chip export controls and the adoption of an Indo-Pacific strategy to cultivate regional counterweights to China became US policy.
In the West, some argue there is an imbalance in China’s economy, and that the country’s rise is a source of disruption or “distortion” of the global economy. An imbalance has arisen because China is producing too much and consuming too little. Some point to the fact that consumption constitutes less than 40 per cent of China’s economy, compared to about 70 per cent in the case of the US.
There are also concerns that China has an overcapacity in manufacturing. In 2024, China accounted for 31.6 per cent of global manufacturing output, almost double that of the US (15.9 per cent), far outstripping that of other industrial nations. A theme in many economic analyses of China is that it should have adopted more aggressive measures to boost consumption and enable its domestic market to absorb its excess production.
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Yet nothing beats Trump when it comes to disrupting the global economic, trade and financial systems since his return to power. The now-suspended “reciprocal” tariffs announced on “Liberation Day” are nothing short of “divide and conquer” tactics, in the words of Nobel economics prizewinner Joseph Stiglitz, designed to bulldoze the US’ trading partners into submission.