The growing appeal of China's model of authoritarian capitalism, and how it threatens the West
Niv Horesh says the West is blind not just to the draw of China's system, but also the faults of its own
Under President Xi Jinping , China is succeeding in creating an alternative vision for global leadership designed to challenge Western, and in particular American, dominance. Momentum is gathering behind the Asian Infrastructure Investment Bank, a US$100 billion initiative officially launched by China last month, in the face of US opposition, to finance Asia's infrastructure needs. It is the first time the US is without a role in what will be a leading financial institution in the world.
The rise of the AIIB comes months after the British government became the first in the Western world to issue a sovereign bond in renminbi, reigniting the debate over whether the renminbi can eventually supplant the US dollar as the leading global reserve currency. And the extent of China's programme to build artificial islands in disputed waters in the South China Sea has been revealed; the latest in a long series of assertive Chinese moves to counteract US influence in the region.
Meanwhile, China's economic rise is seen as incrementally undermining US global leadership.
The message from China is clear: it is supremely confident in its own governance model and is committed to pursuing an alternative path of development to Western-led neo-liberalism.
Until now, the Chinese brand of authoritarian capitalism has remained largely unpersuasive to the majority, although it has gained traction in developing economies like Vietnam and Venezuela. But the West needs to recognise the growing appeal of the China model in the eyes of the developing world, especially as Western economies struggle to recover from the global financial crisis.
When developing countries look to the West, they see growing disillusionment among its electorates, austerity and rising inequality. The West's uncertainty about its own future serves to magnify, even glorify, the Chinese success story for developing economies in Asia, Africa and Latin America. It will not come as a surprise if more turn to China for lessons in economic development.
