China's Problems

| Fri Dec. 11, 2009 3:52 PM EST

Dan Drezner points to a piece in the New York Times about growing discontent with China in the developing world:

China has long claimed to be just another developing nation, even as its economic power far outstripped that of any other emerging country. Now, it is finding it harder to cast itself as a friendly alternative to an imperious American superpower. For many in Asia, it is the new colossus.

“China 10 years ago is totally different with China now,” said Ansari Bukhari, who oversees metals, machinery and other crucial sectors for Indonesia’s Ministry of Industry. “They are stronger and bigger than other countries. Why do we have to give them preference?”

To varying degrees, others are voicing the same complaint. Take the 10 Southeast Asian nations in the Association of Southeast Asian Nations, known as Asean, a regional economic bloc representing about 600 million people. After a decade of trade surpluses with Asean nations that ran as high as $20 billion, the surplus through October totaled a bare $535 million, according to Chinese customs figures, and appears headed toward a 10-year low. That is prompting some rethinking of the conventional wisdom that China’s rise is a windfall for the whole neighborhood.

Vietnam just devalued its currency by 5 percent, to keep it competitive with China. In Thailand, manufacturers are grousing openly about their inability to match Chinese prices. India has filed a sheaf of unfair-trade complaints against China this year covering everything from I-beams to coated paper.

I don't have any lengthy comment about this, other than the obvious: China looks scary to some people today because they project its current growth rates into the far future and then assume that everything else in the world will stay the same.  But as China becomes more highly developed, it's going to encounter the same problems maintaining growth that everyone else does.  What's more, it's going to start developing a lot more rivals, both overseas and nearby.  That's going to make its foreign policy way trickier than it is today.  They're already getting a taste of that in Copenhagen, where American representatives are getting occasional breathing spells from the usual attacks as climate activists bash China instead.  It's only going to get worse for them in the future.

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