‘If China sneezes, the world catches a cold’

China’s once in a decade power transition has led the world to focus on the emerging power’s global ambitions. Despite fears of Beijing’s military and political designs, analysts say China’s economic rise will play a key part in the new world order.

With Xi Jinping set to take the reins from outgoing President Hu Jintao on Thursday, analysts have speculated how the reform-minded leader will keep China on its forward trajectory.

China’s ascendency has for the past decade been contingent on blistering economic growth, a trend that Professor Joseph Cheng from Hong Kong City University believes will continue despite the lingering economic downturn.

“China now aims at an annual growth rate of 7 percent, plus or minus one in the coming five to ten years. This should be manageable, mainly because the high growth rate areas of China have been moving from the coastal areas to the interior provinces,” Cheng told RT.  

These projected levels of growth should leave China on track to overtake the US economy within the next four years says James Corbett, editor of the Corbett report. Corbett told RT that “a lot of players” have a vested interest in China’s economic rise, as a significant downturn would reverberate far beyond the country’s borders.

“If it was true in past years, that if the US sneezed the rest of the world  catches a cold, I think it’s now becoming true in a Chinese situation.  So I think even if China is not able to maintain its blistering pace of growth, it is still going to continue to grow, because there are a lot of investments simply hinging on that idea,” he argues.

The military component of China’s ascendency is not merely a reaction to the United States so-called Asian pivot, as any great power would need the means to “defend its territory and overseas interests,” Cheng believes.

Double digit growth in military expenditure reflects China’s shift from being an advanced weapons importer to an advanced weapons developer, as evidenced by the growth in the country’s research and development budget.

Other factors driving the country’s defense spending include the exorbitant outlays needed for remuneration, which “has been absorbing a very large portion of the military budget,” as well as a need to catch up in vital areas like the country’s vastly underdeveloped naval capabilities, Cheng says.

Corbett believes that while Beijing does one day hope to rival American military dominance in the region, economic and financial interests between the two states will likely nullify the potential of a direct confrontation in the near future.

But with China playing an excessively aggressive role in the region at a time when economic decline is pushing Washington to institute across the board cuts to its military budget, some form of conflict “may potentially develop some ways down the road.”