Monday, September 12, 2011

A Sinopolar world

Forget about G2, China could be G1 soon. Arvind Subramanian's wake-up call is a must read

An economist and this newspaper’s columnist, Arvind Subramanian, has written a provocative book announcing the potential arrival of China as the world’s “dominant” economic power sooner than widely imagined. Eclipse: Living in the Shadow of China’s Economic Dominance (Peterson Institute of International Economics, 2011) warns a complacent West (a distracted India must also pay attention) that “Chinese economic dominance is more imminent and more broad-based – encompassing output, trade, and currency – than is currently recognised”.

The nineties saw many books predicting the “coming collapse of China”, while more recently there has been a spate of books recognising China’s rise but adding the caveat that the United States is going to remain on the top for the foreseeable future.

Much has, of course, been written about the “power shift” from the West to the East, the decline of the G7 economies, and the rise of China. Till 2008, and well into 2009, many in the United States, led by Fred Bergsten, had assumed that China and the US could create a G2 and run a bipolar condominium.
The Chinese pooh-poohed the G2 idea, seeking to retain their status as a voice of the developing world and preferred the French view of a “multi-polar” or “polycentric” world, perhaps partly to assuage fears in Asia about the rise of an “assertive” China.

Full report here Business Standard

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