China is Ready for the Era of Great Rivalry

【This is our translated version of Professor Jin Canrong’s original speech delivered in Shanghai.】

Hello everyone, I am very honored to be here and share my thoughts on what I call “China and the World in ‘An Era in Great Rivalry’”.

Firstly, let’s discuss what “An Era in Great Rivalry” means.

There is much happening worldwide: the Russia-Ukraine war is still ongoing, the Israel-Palestine conflict is escalating, and the world is overall in a confrontational state. There are clashes between India and Pakistan in Kashmir, the U.S. bombed Syria on October 26, 2023, and conflicts keep arising one after another.

Meanwhile, China is engaged in our own “battle” – the “e-commerce war” unfolding on China’s internet. Our netizens summed it up well: “We do not live in a peaceful era, but we are fortunate to live in a peaceful country.”

In my opinion, amid the generally chaotic world order, the ongoing Russia-Ukraine conflict is the most dangerous one. Ukraine is a proxy and puppet of the United States, and American politicians and media openly refer to the Russia-Ukraine conflict as a “Proxy War.” Of the 193 United Nations member states and over 200 countries and regions on Earth, only China, the U.S., and Russia truly possess strategic autonomy and the capability to completely destroy each other.

Two of them are currently in a state of military confrontation. The U.S. is heavily involved in the Russia-Ukraine conflict. Although there is no direct deployment of troops, the intelligence in Ukraine is provided by the U.S., and some Ukrainian troops are directly trained by the U.S. This is why the Russia-Ukraine conflict is particularly dangerous- it is in essence as a Russia-US conflict involving military confrontation.

Apart from war, there is too much uncertainty existing in the world economy as well. The World Bank and the International Monetary Fund have both lowered the projections for economic growth rates in recent years, and international trade is currently facing challenges. Climate change is accelerating, with natural disasters occurring more frequently than before, such as droughts and floods. This is the situation humanity is facing – major powers are not cooperating, middle powers lack order, as President Xi Jinping stated, “The world today is undergoing major changes unseen in a century.”

Another interpretation of “major changes unseen in a century” would be “The world has entered an era of great rivalry.”

“An Era of Great Rivalry” should not be unfamiliar to those familiar with the Chinese history. Historically, the term has been used to describe two situations in the Chinese history: the first one being the Spring and Autumn period with the ensuing Warring States period. During the early Spring and Autumn period, the vast lands of China were filled with numerous states, which were later reduced to seven warring states, eventually consolidating into one dominant power. People at the time lived in tragic circumstances. Confucius said, “there were no righteous wars in the Spring and Autumn period.” Another situation is the change of dynasties. When an old dynasty collapsed, and a new one was not established, the resulting power vacuum often led to continuous conflicts and widespread devastation.

The common feature of these two situations is that they were both transitional periods when the disintegrating old order is giving way to a nascent new one that had yet to fully form. We can now apply this concept in understanding the world today.

I believe that the world today has entered “An Era of Great Rivalry”: we are once in a transitional period where the old Western-dominated order is disintegrating, but a new order has not yet been established. What we are witnessing now is a global version of the Spring and Autumn period and the Warring States period.

The past 40 years have been relatively peaceful, with major powers focusing on trade competition instead of wars. States saw financial disputes because they were more focused on making money than going to war.

Personally, I believe that trade wars indicate positive relations between two countries – North Korea and the U.S. will never have a trade war because they have no relationship whatsoever. China and the U.S. would never have a trade war if they didn’t have a close economic tie. Trade wars in the past actually reflected positive international relations, but that is not the case today.

The United States and Russia are now in a state of military confrontation, with the entire Western world aligning against Russia. The risk of a conflict between China and the United States is also on the rise. The U.S. is treating China as a major competitor, suppressing China comprehensively, and playing the very dangerous card of Taiwan. The U.S. is also increasingly losing confidence in itself and resorting to rearming Japan and inciting India to provoke China.

Therefore, China is now placed a more dangerous world that has entered “An Era of Great Rivalry.” The possibility of major power conflicts is looming.

President Xi Jinping summarizes the world today as “undergoing major changes unseen in a century”. What does this “major changes unseen in a century” refer to? I suggest interpreting it through the lens of four new phenomena:

The first is the emergence of a new international order; the second is the establishment of a new model of modernization; the third is the arrival of a new industrial revolution; and the fourth is a new global governance framework represented by the “Belt and Road Initiative.”

Since the opening of the Mombasa-Nairobi Railway constructed by Chinese enterprises, it has provided a significant number of new job opportunities for the people of Kenya.

The new international order refers to the shifting power dynamics among nations, especially among major powers. In reality, the country with the most power dominates the international order. The West has undeniably dominated the world for the past 500 years. As Mr. Liang Qichao has put it, modern human history has been defined by Western hegemony. Why has the West been able to dominate for 500 years? There are two reasons: geographical discoveries and the industrial revolution—through geographical discoveries over 500 years ago, the West surpassed us; and through the industrial revolution over 300 years ago, the West crushed us.

Why, then, do we say that a new order is emerging now? As we enter this century, the trend of “the East rises, the West declines” in the global order has become evident. The rise in the East begins with China’s undeniable ascent, followed by India. Under Modi’s leadership, India’s economy has been developing well, particularly noteworthy are Modi’s measures-his use of Hinduism to reorganize the Bharatiya Janata Party (BJP), implementing poverty alleviation programs for millions and his emphasis on nationalism.

India has quite an impact on the Global South. I have visited developing countries where they believe they can learn from India, which represents a unique form of influence for India.

Under Modi’s leadership, India’s GDP has surpassed Canada, Italy, and France in just 8 years, officially exceeding the UK last year and ranking as the world’s fifth-largest economy, providing them with a great morale boost. This New Year’s Day, Modi announced plans to surpass Germany and Japan within 5 years. Most likely starting in 2027, the world’s GDP will be ranked in the following order: China, the United States, and India.

The IMF predicts that by 2027, India’s economy will surpass that of the United Kingdom by 20%.

Another region on the rise is ASEAN. In 2000, ASEAN’s GDP was less than $600 billion, but it has now reached over $3 trillion. Kishore Mahbubani, a Singaporean scholar of Indian descent, coined the term “CIA era,” where CIA stands for China, India, and ASEAN. The CIA era signifies the rise of the East.

Having discussed the “Eastern rise,” let’s consider the “Western decline.” The decline in the West refers to Europe and Japan.

When we talk about the West, what exactly do we mean? The West consists of the United States, Europe, and Japan as the major players, with Canada, Australia, New Zealand, and Israel as minor participants forming a closed circle that excludes other nations. The real decision-makers within the group are the three major powers: the U.S., Europe, and Japan. The current situation is as follows: the U.S. still possesses advanced comprehensive strength, but its allies, Europe and Japan, are truly struggling.

Firstly, Europe is faltering. When the European Union was established in 1992, it comprised 15 countries and was the world’s largest economy at the time. By 2022, the EU had expanded to 27 countries, yet its GDP now ranks third, falling behind China. In addition to the decline in economic output, Europe faces a significant challenge in keeping up with new technologies.

One focal point of competition among major powers is artificial intelligence. For instance, one cutting-edge technology in artificial intelligence is the ChatGPT—a large language model developed by the United States, with China also catching up. No European company has been able to compete in this field, and some European governments even prohibit its use. Italy, for example, fines users €20,000 for using such technologies, reflecting a very typical “closed-door” policy.

Europe’s most competitive industry is traditional internal combustion engine cars. Most drivers acknowledge that European cars, especially high-end models, are excellent. However, China and the U.S. have overtaken them by focusing on electric vehicles, causing Europe to lose its traditional advantage. I believe it’s only a matter of time before electric vehicles replace traditional combustion engine cars. In fact, Europe’s industrial development was thriving post-World War II, especially in areas such as new energy sources like solar, wind, biomass, hydro, and nuclear energy. For a long time, Europe was the leader in these fields, but over the past 20 years, China has surpassed them in every aspect. Europe is losing its edge—both in terms of overall economic output and technological advancement.

Japan, once the weakest among the U.S., Europe, and Japan, has now further declined. Firstly, its overall economic output is disappointing. In 2021, Japan’s GDP was ¥51 trillion, while China’s was ¥170 trillion—more than three times that of Japan. By 2023, the Japanese yen significantly depreciated, shrinking to ¥42.3 trillion, while China’s GDP reached ¥180 trillion, making it nearly four and a half times that of Japan. This year, Japan is expected to drop to fourth place in terms of GDP rankings, and the gap between China and Japan may slightly widen on this four and a half times basis.

Next, Japan’s competitive industries has lost two-trillion-dollar market as result of their two serious strategic misjudgments.

First and foremost is the smartphone industry. Those who are a bit older may remember that during the era of analog phones, Japanese phones were the best. In the early stages of smartphones, Japan held the most patents and had the best technological reserves. However, due to strategic errors, Japan hesitated to enter the smartphone market and was eventually overtaken by competitors like Samsung, Apple, and a group of Chinese smartphone companies. By the time Japan realized its mistake, it had already lost its competitive edge , with other companies dominating the market.

Another industry is new energy vehicles. Japan was an early player in this field, but it chose the wrong technological path. While hydrogen energy projects have less pollution and lower energy consumption, the technology itself is extremely challenging. On the other hand, the lithium battery route pursued by China, the U.S., and Europe proved to be successful. Japan, however, remained stubborn and continued down its own path. On January 27th of this year, Toyota’s chairman admitted that their chosen technology was not feasible, realizing they had missed the opportunity. These two technological missteps within a mere 20 years exemplify Japan’s poor strategic capabilities.

The shift in power dynamics from East to West has impacted the global landscape, marking the end of Western dominance over the past 500 years. This is what “major changes unseen in a century” or “An Era of Great Rivalry” refers to.

As the balance of physical power changes, so does the mindset of the West. The dominance of the West in the past 500 years cultivated a sense of arrogance. They believed that modernization had only one path – the Western model, and those who deviated from this model needed to be “fixed”. However, over the last decade, their psychological superiority has been shattered. The West now acknowledges China’s rise , though it views it as a threat, and recognizes that China’s development path differs from its own. This shift has broken down the Western superiority complex, challenging the uniqueness, absoluteness, and exclusivity of the Western model. This significant psychological shift is also a key aspect of the current global transformation.

Humanity is moving towards the fourth industrial revolution, which I believe will be one of the greatest events in human history. Unlike the previous three revolutions where China made minimal contributions, China will undoubtedly play a decisive role  in the fourth revolution. This also marks a monumental change unseen in centuries.

The essence of modern history lies in industrialization. Only through industrial revolutions that advance productivity can human civilization experience overall progress. Our social revolutions, ideological revolutions, institutional revolutions, management revolutions, and artistic revolutions are all products of this industrial progress. The Anglo-Saxon nations, who predominantly led two and a half of the three industrial revolutions, have wielded significant global influence.

Today, they form the “Five Eyes Alliance,” led by the United States, holding political hegemony, including control over organizations like the United Nations, and dominating international trade, where 90% of trade occurs via the oceans – whoever controls the seas controls the world, currently under U.S. military dominance. Additionally, the U.S. possesses economic supremacy through the dollar and technological dominance, with a majority of Nobel Prizes in the field of technology awarded to Americans.

In terms of soft power, the ideology of Anglo-American liberalism holds sway over most discourse in media and social sciences. This extends to disciplines such as law, political science, international relations, sociology, demography, education, journalism, psychology, where mainstream theories align with Anglo-American ideologies. This is the reality we face today.

China’s modern history began in 1840, enduring a century of national humiliation from 1840 to 1949, followed by a period of national rejuvenation since 1949. In the 74 years since 1949, People’s Republic of China successfully achieved in three quarters of a century what the West took 300 years to accomplish in industrialization. The greatest achievement of PRC in these 74 years is transforming from an agrarian society to an industrial powerhouse, becoming one of the few countries with a comprehensive industrial system. The advanced productive technologies that China possess now are the foundation for China’s dream of the great rejuvenation of the Chinese nation.

According to a World Bank report released last October, of the 233 countries and regions on Earth, only 30 have achieved industrialization. Of these, 28 did so before World War II, with South Korea and China achieving industrialization post-WWII. South Korea was a semi-colony of the U.S., with its industrialization facilitated by American support, while China forged its path independently.

After missing out on the first two industrial revolutions, China caught up during the third industrial revolution phase. In the race towards the fourth industrial revolution in the fields of artificial intelligence, life sciences, industrial materials, and new energy, the major competitors are China and the U.S., with Japan mostly lagging behind, Europe gradually withdrawing, India awakening, and Russia preoccupied elsewhere.

In conclusion, the future of the fourth industrial revolution will undoubtedly be shaped by the contributions of China and the U.S., and this is a monumental change unseen in centuries. The world ushered in globalization after the geographical discoveries connected humanity as a whole. With globalization naturally comes the issue of global governance and the West has been dominating the world since then. Since the 18th National Congress of the Communist Party of China. China has stepped up its involvement in global governance significantly, transitioning from “standing up” “getting rich” to “becoming strong”. A strong China must participate in global governance, shifting global governance from Western dominance to shared governance between East and West, marking the final aspect of the great changes unseen in a century, the essence of “An Era of Great Rivalry”.

In summary, the four new phenomena in the“Era in Great Rivalry” are all interconnected with China, making China the most significant variable in this era. The world is at an inflection point unparalleled in the past 500 years, surpassing the profundity and magnitude of the First and Second World Wars. While the two world wars reflected internal conflicts within the West, we are now witnessing a complete reversal in the East-West relationship, the most profound change in the past 500 years. Consequently, numerous conflicts are bound to arise, particularly the tensions between China and the U.S. There is no magic formula to navigate this. The key lies in steadfastly focusing on economic development, prioritizing domestic economic growth, striving for high-quality development, achieving breakthroughs in industries, emphasizing internal circulation while promoting external circulation. Pursuing economic strategic independence and seizing the initiative in the China-U.S. power play is paramount. This, ultimately, is my conclusion.