Valeriano Di Domenico

World News


Chinese President Comes to Davos

“Xi Jinping was the first Chinese president to come to Davos, and in January 2017, the first freight train from Yiwu to London became operational. This is staggering! We already speak of Eurasia. Things happen at amazingly rapid pace,” says Jean-Pierre Lehmann, emeritus professor of international economy, founder of Evian Group and visiting professor at Hong Kong University.

During his conference on the topic of the Silk Road delivered recently in Bucharest for academics and think-tanks, Lehmann depicted China’s position in today’s world, by suggesting that “the narrative of the 21st century will be written in Asia by the Asians. Above all, has been the emergence of China as regional and global power. China is already the main market for many countries, from Brazil to France…Look at the map of the String of Pearls and you’ll see the Chinese geopolitical and military influence. There are Chinese interests across the world, from Seattle to Djibouti…”

Lehmann reminded the audience of The Rise of the Great Powers, a 12-part documentary produced by CCTV, and called attention that all great powers have experienced wars and, except for Japan, were Western, while China, the rising power of the 21st century, seems to be the only great power able to conquer peacefully. An extraordinary ability, appreciated even more when you think that China had many turbulent moments in its history and maybe precisely that is the reason why it wanted a peaceful conquest of the world.

“The 19th century was humiliation, 1949 meant Liberation but still suffering from internal disputes…1949 changed China and 1979 changed the world,” believes Lehmann quoting Zheng Bijian who stated that “the most strategic choice China made was in 1979 to embrace economic globalization.” Lehmann noted that in 1979 Deng Xiaoping expressed the idea that China’s development was no longer possible in isolation and he adopted the opening policy towards global capitalism. three decades after, global capitalism cannot do without China. “The world depends on China and China depends on the world. In 1984, I saw China opening itself and a tremendous desire to acquire knowledge,” says Lehmann who has spent his last 20 years in China and South East Asia.

The question: “How do the Chinese view the world?” has the best illustrative answer in China’s pavilion at Shanghai Expo, believes Jean-Pierre Lehmann, as the pavilion was shaped “like an image of the reflective DNA of China’s position in the world. It’s interesting to note that only Admiral Zheng He in the 15th century went globally and made amazing trips to Arabia, Africa, India…after him, China looked continentally and it took it 500 years to start going globally again.”

China’s global dimension is already obvious: “The Asian Infrastructure Investment Bank, set up in 2016, attracted even US allies, Obama failed to prevent them from joining the AIIB. China already set up 110 economic zones in 50 countries. In Xi’an, the Summit of the Silk Road gathered 500 participants from 52 countries.”

Lehmann advises that “…China will become a high income economy, with strong harmonious relations and driven by creativity and power of ideas. Chinese economy was made by muscle but now it’s getting more with the brain, but many do not understand this! The Chinese recognize that they must learn much and fast, and they penetrate. 25% of the world’s economic growth comes from China. The streets in China are full of foreign entrepreneurs! China is a complex phenomenon difficult to characterize, you can say anything and the opposite about China! Look, it is possible to have a closed political system with an open economic system. Communism and politics go divergent.”

Lehmann calls attention that the Silk Road, the project involving $2.5 trillion and 1.75% surplus to the world’s GDP, goes through turbulent areas and faces risks, and if economic benefits can be reaped there, it’ll be great. One of the risks is the new-asset quality, as Fitch warned, China may go in deep debt because the project is incredibly huge. Social unrest in certain areas is also high.

In any case, we must also have in mind that although the land route and the maritime route do not bring much profit at the moment and “the train returns empty from Europe, it has a geopolitical reason. The Chinese say these routes will be developed as a hedge against each other,” according to Lehmann.

Another aspect that “cannot be predicted at this moment is the relationship China—Russia, as China is a rising power, and Russia is a declining power. Russia is lesser than the US as economic power. And Putin would put in more personality chemistry in this relation. China –US relation is also difficult to predict, especially when you make certain choices such as playing with Taiwan, which is very dangerous…Choices make accident happen,” forewarns Lehmann concluding that “there are many uncertainties at this moment.”

Jean-Pierre Lehmann sees the competition to work with China harsh: “Often, many countries seem to have the same competitive advantages but you should keep up the discussion and build relations for business with the Chinese.”

Whereas “China’s foreign policy could reshape a good part of the world’s economy,” thinks Jean-Pierre Lehmann, he suggests that “we should not have the logic that China wants to be the hegemon…I have the feeling that China sees itself as a Middle Kingdom but at the same time it does not want to play the role of the global power. There is going to be a multi-polarity or a-polarity.”

To place China’s position in today’s world, Lehmann told a symbolic anecdote: “when the Chinese PM wanted to meet the British Queen during his visit to the UK, the first reply was that the Queen can meet only heads of states, and when the Chinese PM refused to go, the UK changed the protocol and made the meeting possible.”