As a growing power on the economic and diplomatic stage, China has certain tools at their disposal. According to the Economist (March 31, special report, p4), nations achieve their goals using some combination of three things: guns, money and ideas. But unless you spend most of your time in neo-conservative circles, you probably don’t hear much about China’s military. The neo-cons aren’t completely crazy; China is building up its military capability, but during my recent visit there, it’s clear that both the government officials and citizens with whom I spoke valued one of their favorite philosophical buzzwords: harmony.
Government officials claimed they must grow while respecting harmony of the people and environment. A Chinese colleague told me that the Chinese wish to live in harmony with their neighbors around the world and military action would surely disturb that balance. Indeed, China has chosen harmony with its neighbors through economic leadership and trade over military coercion. China’s membership in the World Trade Organization has focused on economics rather than the flexing of muscles.
Meanwhile, media reports in the west warn constantly of China’s emerging power and rave about the market opportunity there. Beijing, for example, is a beautiful, mostly clean, modern city. There is so much rapid growth, that everyone who leaves for a couple of weeks, can barely find their address with all the new tall buildings sprung up in the way.
In reality, China today is still a numbers game. True, many are growing rich, but there are many more still supplying the cheap labor that keeps our athletic shoes and Wal*Mart’s inventory so affordable. Marketing to China is like an experiment in long-tail economics, where one can find success even on the fringes of society, so long as their are enough folks around. As their economy grows, more of those providing cheap labor are gaining the economic muscle to actually buy products made in their country. China too, is producing more than cheap toys and knock-offs. Now-a-days, they’re making more complex products like cell phones and computers. So, while cheap labor slowly dwindles and prices steadily rise, so too does competition on the very items that companies like the United States still excel at producing.
Change is frightening and China’s rise must keep the United States and other economies on their toes. So far, China is focusing on money and ideas as opposed to guns, but, after all, China is ruled by people and sometimes people get strange ideas what they can do with their power. Just ask George Bush. Still, fear of change aside, China is returning to what they believe is their rightful place as a world power and with a fifth of the world’s population, why shouldn’t they be a fifth of the world’s economy? The rest of us better get used to it!