- GLOBAL RESEARCH - Prof. James Petras - APRIL 18, 2023 -
China and the United States are moving in polar opposite directions: Beijing is rapidly becoming the center of overseas investments in high tech industries, including robotics, nuclear energy and advanced machinery with collaboration from centers of technological excellence, like Germany.
In contrast, Washington is pursuing a predatory military pivot to the least productive regions with collaboration from its most barbaric allies, like Saudi Arabia.
China is advancing to global economic superiority by borrowing and innovating the most advance methods of production, while the US degrades and debases its past immense productive achievements to promote wars of destruction.
China’s growing prominence is the result of a cumulative process that advanced in a systematic way, combining step-by-step growth of productivity and innovation with sudden jumps up the ladder of cutting edge technology.
China’s Stages of Growth and Success
China has moved from a country, highly dependent on foreign investment in consumer industries for exports, to an economy, based on joint public-private investments in higher value exports.
China’s early growth was based on cheap labor, low taxes and few regulations on multi-national capital. Foreign capital and local billionaires stimulated growth, based on high rates of profit. As the economy grew, China’s economy shifted toward increasing its indigenous technological expertise and demanding greater ‘local content’ for manufactured goods.
By the beginning of the new millennium China was developing high-end industries, based on local patents and engineering skills, channeling a high percentage of investments into civilian infrastructure, transportation and education.
Massive apprenticeship programs created a skilled labor force that raised productive capacity. Massive enrollment in science, math, computer science and engineering universities provided a large influx of high-end innovators, many of whom had gained expertise in the advanced technology of overseas competitors.
China’s strategy has been based on the practice of borrowing, learning, upgrading and competing with the most advanced economics of Europe and the US.
By the end of the last decade of the 20th century, China was in a position to move overseas. The accumulation process provided China with the financial resources to capture dynamic overseas enterprises.
China was no longer confined to investing in overseas minerals and agriculture in Third World countries. China is looking to conquer high-end technological sectors in advanced economics.
By the second decade of the 21st century Chinese investors moved into Germany, Europe’s most advanced industrial giant. During the first 6 months of 2016 Chinese investors acquired 37 German companies, compared with 39 in all of 2015. China’s total investments in Germany for 2016 may double to over $22 billion dollars.
In 2016, China successfully bought out KOKA, Germany’s most innovative engineering company. China’s strategy is to gain superiority in the digital future of industry.
China is rapidly moving to automate its industries, with plans to double the robot density of the US by the year 2020.
Chinese and Austrian scientists successfully launched the first quantum-enabled satellite communication system which is reportedly ‘hack proof’, ensuring China’s communications security.
While China’s global investments proceed to dominate world markets, the US, England and Australia have been trying to impose investment barriers. By relying on phony ‘security threats’, Britain’s Prime Minister Theresa May blocked a multi-billion dollar Chinese investment-heavy nuclear plant (Hinckley Point C). The pretext was the spurious claim that China would use its stake to “engage in energy blackmail, threatening to turn off the power in the event of international crises”.
The US Committee on Foreign Investment has blocked several multi-billion dollar Chinese investments in high tech industries.