Abstract
Whereas many know about China’s economic growth in recent years, the most people have little understanding regarding how the country’s historical roots and political structure have contributed to development. Through an analysis of relevant literature, this article examines China’s historical roots and political structure as they affect its foreign policy decisions that have contributed to shaping the country’s national development. It is suggested that a deeper understanding of this relationship will help Western nations interpret China’s current and future policy decisions in order to forecast the potential significance of its global influence over the next decade.
Highlights
With the world’s largest population and the second largest economy, the People’s Republic of China’s industrial activity over the last few decades has made a strong impression on the global community
Russia’s state capitalism is different from that of China’s in that the latter has “a direct interest in commercial development which is lacking in Russia” because “China extracts rents from commerce, while Russia does it from resources (Schweinberger, 2014, p. 172)
China has a distinctly different historical context than the nations that make up North America and Europe, the government’s policy change towards a system of state capitalism has greatly improved China’s compatibility with the global economy
Summary
With the world’s largest population and the second largest economy, the People’s Republic of China’s industrial activity over the last few decades has made a strong impression on the global community. In the span of only three decades from 1979 to 2014, China’s annual real GDP growth averaged approximately 10%, and it has become the world’s largest manufacturer, exporter, and holder of foreign currency reserves (Morrison, 2015) This growth, which has drawn the attention of many, Western nations, compares favorably against the average annual growth in real GDP of their regional rivals, Japan (7.7%) and South Korea (9.1%) from 1950 to 1980 (OECD, 2009). While many in North America and Western Europe know about China’s tremendous growth, they have little understanding regarding how the country’s historical roots and political structure have contributed to its development. China’s state capitalism, which is a historical and political byproduct, is a prime example of what Westerners have little clear understanding. It is proposed that an understanding of this relationship will help Western nations interpret China’s current and future foreign policy decisions in order to forecast the potential significance of its global influence over the decade
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