China gained on America in 2020 and hopes to pass us by 2028
By Ernest Istook, Frontiers of Freedom
China gained on the United States in 2020 and hopes to build on that momentum to gain more in 2021.
Once China pursued a “Great Leap Forward.” Now they have three plans: military expansion, “Made in China 2025,” and their Belt and Road Initiative (BRI). Each involves more than a trillion-dollar commitment to lead the world in key sectors.
A new year-end report from Britain’s Centre for Economics and Business Research predicts the size of China’s economy will exceed that of the US by 2028. That’s five years sooner than the Centre projected when 2020 began.
In its study of 193 countries, the Centre reported that China was the only major global economy to expand in 2020, bouncing back from COVID-19 to grow by 2%.
Another report, from the Council for Foreign Relations, condemns Made in China 2025, which is the plan to lead the world in manufacturing, especially in high-tech. The CFR report discusses how the plan is based upon “China’s disregard for intellectual property, discrimination against foreign firms, and use of preferential industrial policies to unfairly bolster Chinese firms.” It adds, “China’s intention through Made in China 2025 is not so much to join the ranks of hi-tech economies like Germany, the United States, South Korea, and Japan, as much as replace them altogether.”
But it’s not all about high-tech and stolen ideas. The plans also involve two old-fashioned and timeless methods—infrastructure and logistics, focused both within and outside of China’s borders.
China has internal controls that limit how businesses from other nations can participate in its growth, requiring them to sacrifice both intellectual property and certain human rights commitments. But the determination to control matters outside its borders as well is nowhere more evident than China’s effort to control the seas commercially and militarily.
Building military bases in the South China Sea and limiting passage is one attention-grabber. So is the October report from the Congressional Research Service which warns Congress that China’s fast-growing navy is now “a major challenge to the U.S. Navy . . . in the Western Pacific — the first such challenge the U.S. Navy has faced since the end of the Cold War.”
Less-noticed is China’s expanding chokehold on cargo shipments worldwide, important because 90% of global trade travels by ship. This involves another trillion-dollar-plus Chinese effort, its Belt and Road Initiative (BRI) that has given China a foothold in transportation and logistics facilities in over 100 countries. The Australian conglomerate BHP calculates that the BRI is seven times larger than the Marshall Plan that America funded to rebuild Europe’s infrastructure after World War Two.
China buys control from whoever is willing to sell it. As Forbes puts it, China has been on a “seaport shopping spree” buying control of major port facilities worldwide, and on every continent except Antarctica. It uses the Chinese method of blurring the lines between business and the military. A recent Department of Defense report says the BRI is “leveraging civilian construction for military purposes; and . . . logistics . . . for military purposes.”
Thanks to funding by its government, China is building over a third of the world’s ocean-going merchant ships, producing 96 percent of the world’s shipping containers, and it controls the largest port and logistics company in the world. This serves both its economy and its People’s Liberation Army, all according to the 2020 assessment by the Center for Strategic and International Studies.
There is one area where China’s maritime dominance cannot extend, however. Unlike in other places, China cannot be part of the internal trade within the United States that carries goods by water, on American rivers and intracoastal canals, and between U.S. ports. That is blocked by the Jones Act, a law that turned 100 years old in 2020. It requires vessels involved in internal trade within American waters to be American-built, American-owned and American-crewed.
Yet some U.S. interests want 2021 to be the year this safeguard is removed. They seek to repeal the Jones Act, arguing that it would be cheaper for us to let other countries handle our internal shipping. What they ignore is that the real issue is not money; it’s power. Whoever controls the seas can control the world’s trade.
If China’s economy might surpass the American economy, then repeal of the Jones Act would only hasten that event. America must be strong to protect and promote our values, especially when confronted by a country that too often stands for the opposite.
2021 will be decisive on whether we let China succeed by undercutting our values. America’s media focuses on our left vs. right squabbles and the insults constantly exchanged on Twitter. Instead, they should pay attention on China’s effort to push the United States aside on the global stage.
Former Congressman Ernest Istook is a distinguished fellow at the Frontiers of Freedom.