The economic divide between the United States and China is projected to widen to US$11 trillion by the end of the decade, yet escalating geopolitics – specifically the war in Iran and the ongoing Strait of Hormuz crisis – could inadvertently act as a stabilising force for bilateral ties, according to a prominent global strategist.
Kishore Mahbubani, former president of the UN Security Council and once a top diplomat from Singapore, has forecast that the gross-domestic-product disparity between the world’s two largest economies may become more pronounced, and that anyone who believes the US is weakening “ought to have his head examined”.
“The US still remains the most powerful economy. Even in the 2000s and 2010s, when China grew much faster, the gap in size has not diminished,” Mahbubani said, speaking on Tuesday at the China Conference hosted by the American Chamber of Commerce in Hong Kong.
“[The gap] has actually grown. In 2020, US GDP was US$21 trillion, China’s was US$15 trillion – US$6 trillion gap,” he explained. “In 2030, US GDP is expected to reach US$37.6 trillion and China US$26 trillion – the gap will go from 6 trillion to 11 trillion.”
But in a similar vein, he said those saying China may be losing out should also have their heads checked.
“China’s emergence has been the single largest transformation in world history ... The size and scale of China’s resurgence in such a short space of time is beyond amazing,” Mahbubani told an audience that included Julie Eadeh, US consul-general in Hong Kong, and Cui Jianchun, commissioner of China’s Ministry of Foreign Affairs.
With US President Donald Trump expected to embark on a high-stakes visit to China next month, Mahbubani stressed that managing the relationship would require a “tremendous amount” of wisdom and cooperation.
Pointing to the US-Israeli war on Iran, having just entered its third month, and the associated stalemate in the Strait of Hormuz, choking global shipping, the former diplomat said crises like these may yield a “positive impact”.
“It’s possible for some of these conflicts to have a positive impact on US-China relations,” he argued, citing the historical precedent of how North Korea once brought the two superpowers closer. “Things were very difficult between the US and North Korea two decades ago. The US was looking for ways to manage North Korea, and [Washington] suddenly found that talking to Beijing helped. So, the North Korean problem, at that time, helped to improve understanding between the US and China.
“Now, the [shipping] blockage in the Strait of Hormuz is hurting China, Asia, the US.”
Washington is under pressure to find a solution, Mahbubani assessed, adding that, “if there’s one country that can talk to all the parties, it’s China”.
“So, if you want to find a solution and someone who can talk to everyone [involved in the war], I would say China is the one that can do that,” he said.
Underscoring the significance of the “3Ps” – people, profit and planet – as a stabilising backstop, Mahbubani also lamented how some business cooperation was being “killed politically”, citing Ford’s failed efforts to form a joint venture with Chinese battery companies.
He further suggested that there remained many realms in which both could work together, like how China could help the US modernise its outmoded infrastructure, if geopolitical tensions do not get in the way.
“When you look at the US, the infrastructure there could do with a lot more investment,” Mahbubani said. “When you fly from a Chinese airport to airports in the US, you can see the difference ... China has first-world airports, while the US doesn’t.
“These are examples of areas where they can collaborate and use the strengths of each other.” -- SOUTH CHINA MORNING POST
