While China’s rank as the second economy in the world means little in material terms, it has an important psychological effect on its international affairs, tells Arthur Kroeber in the Wall Street Journal:
But Arthur Kroeber, managing director of GaveKal Dragonomics Research in Beijing, said the No. 2 ranking may have an important psychological effect in China, where many continue to view the country as poor and believe it bears little responsibility for international affairs. In trade negotiations and international financial summitry, for instance, China often plays a peripheral role. The U.S. and Western Europe generally continue to set the global agenda. “When you’re the No. 2 country in the world, you can’t make the argument any longer” that China can be a follower, Mr. Kroeber said.”From an economic diplomacy standpoint, there’s no place to hide.”
More and more, China is asserting its economic power, he noted, by agreeing to finance infrastructure and other projects in Africa, Latin America and Central Asia in exchange for a secure stream of oil, food and coal.