The Chinese have announced that they will be investing USD 124 billion dollars in the One Belt One Road project connecting Asia and Europe. Such huge spending seems to be now normal for China. How has China reached this stage in its economy?
It is the US which has made China into a powerful and second largest economic entity in the world. China has capitalized fantastically the various opportunities provided initially by the USA. Over the last two or more decades China has transformed itself from a culturally and financially bankrupt country into a global economic powerhouse. It is now flexing its muscles and behaving likea world power capable of even looking USA in the eye.
How has USA made China what it is today. In the 1970's USA was following a policy of containing Communism and had a running cold war with Russia. Its avowed aim was to weaken Russia and finish Communism. China too was Communist but a weak country. The Americans staged a major political coup with China with the famous Nixon-Kissinger strategy of engaging with China and developing relations with it. Post Mao China was almost emasculated with the disastrous Cultural Revolution and its economy was in a terrible shape. The olive branch of entering into economic ties with USA made Chinese supremo Deng come with the now famous observation that it does not matter what is the color of the mice as long as it was catching mice. Thus Communism was given a go by and capitalism was embraced by the Chinese though on paper they are even today a single party Communist run country.
The Americans encouraged investments into China to weaken the Communist fraternity and soon Gorbachov the Russian President moved his country away from Communism and the adjoining countries also got liberated from Russian control. A weak Russia and a failed Communist unity was a tremendous boost to the US.
However by now the Americans realized that goods coming from China were dirt cheap in prices but were of good quality. They liked it. The American industry quickly realized that moving manufacturing to China would give them quality products at much cheaper prices and make them highly competitive in the
Almost everyone now wanted to manufacture in China to take advantage of the low cost of production.The American industry had now deeply got entrenched in China and the Americans had got used to cheap but quality' Made in China' products.You name it and it was produced in China. Even replicas of Indian gods are now made in China.
Today China has nearly USD 3000 billion worth of foreign exchange reserves. It is the largest exporter of goods in the world. It is developing its capabilities to emerge as a world power in the near future. it is poised to play a very significant part in the politics and economies of the world. One has to pay a tribute to the Chinese leadership for transforming China into a giant in a period of about three decades since mid 1980s.The only weakness in their system is that they do not have democracy and its citizens do not enjoy democratic rights of many freedoms like freedom of speech etc. How long Chinese citizens will remain in a regimented set up is a important question.
It is therefore important to note that the USA while combating Russia has ended up building another adversary in China. Now they can target it and continue feeding its industial military complex.