Access to this page has been denied because we believe you are using automation tools to browse the website. Before the crisis Giovanni Arrighi argued in Adam Smith in Beijing that the dominance of the US is unravelling and that China has begun to replace it as the driving force of commercial and economic expansion in Asia and beyond. 2 That China will overtake the US to become the world’s largest economy is a foregone conclusion in some quarters and speculating about the date has become the favourite pastime of some economists. China’s increased integration with global capitalism, particularly from the early 1990s onwards, has been a mike ward forex capital markets source of its meteoric growth.
At the same time, however, its exposure to the world system in general and its symbiotic relationship with the US in underwriting its debt in particular mean that China is increasingly dependent on and vulnerable to the vagaries of the world economy. De Gaulle was soon to be proved wrong. The Chinese economy was treated in an equally dismissive way until relatively recently, but its impact on the global economy today is considerably greater than Japan’s four decades ago. In 2009 China overtook Germany as the world’s biggest exporter and surpassed the US to become the world’s largest consumer of energy. 9 The following year it leapfrogged Japan to become the world’s second largest economy. Claims that these stellar rates of growth cannot continue indefinitely have come from disparate quarters.
Chris Harman and prominent neoliberal commentator Martin Wolf have questioned the sustainability of the Chinese model. China’s model of accumulation After 1949 the foundation of modern industry was built under Mao Zedong by 25 years of state capitalist primitive accumulation, whereby millions of peasants were transformed into urban wage workers. The post-Mao period saw moves towards market-based reforms, including the dismantling of rural collectives, price liberalisation and opening up to foreign capital in designated Special Economic Zones on the southeastern seaboard. A loosening of state controls and prices led to a huge increase in agricultural output and the creation of surpluses that were then invested in town and village enterprises. This gave rise to a new model of capitalist accumulation, which combined the high level of exploitation and repression of the old state capitalist model with growth predicated on exporting to global markets. Competitiveness in the export market was also underpinned by devaluation of the renminbi against the dollar.