China has long sought to be an international player just like the United States, but it would be incredibly difficult for it to transition itself in the role if it fails to engage India, said Jim O’Neill, the former chairman of Goldman Sachs Asset Management and former UK treasury minister, in an exclusive interview with Business Today.
Jim O’Neill, a notable global economist and chair of UK think tank Chatham House, discussed China’s emergence on the world stage and its implications for the global power dynamics among other things during his special interaction with the said media organisation.
When asked how China would shape its policy to influence the global financial system and importantly, contribute more responsibly towards it, O’Neill said China has been steadfast in pursuing its goals and the policy that they have espoused has always jibed with the 5-year estimates suggested.
Neill, however, added that the outlook for China is not as favourable as it used to be. He cites two reasons for the current predicament facing Beijing. The first one being the crackdown initiated by Chinese Premier Xi Jinping, which is attributed to the desire for more equality and could disincentivize parts of domestic economic growth. According to O’Neill, such a policy decision poses incredible risks to growth at a time when the labour force has veritably peaked in China.
Another reason why O’Neill is unsure of China’s emergence on the global stage is Beijing’s inability to develop a credible policy on how they want to engage with the rest of the world. The former UK treasury minister said China’s complete lack of dialogue and involvement of India in its ambitious one-belt-one-road programme is a testament to Beijing’s failure in inspiring regional players to join its initiative.
“If China can’t truly engage in a constructive way with important neighbours in the region, it shows how difficult it is to be a bigger accepted global player the same way the US has been for the last 50 years. China will have to figure all these things out. It’s difficult for China to find a stable relationship with the rest of the world. Got to change how they engage,” said O’Neill, who coined the acronym BRICS 20-year-ago to portray the probable emergence of economies of Brazil, Russia, India and China.
Besides, O’Neill also weighed in on India’s growth prospects over the span of the next two decades. With favourable demographics, he said, India is poised in the next 15 years to be catapult itself as the 3rd largest economy in the world, surpassing Japan. The achievement of this feat will be contingent upon the Indian policies, said O’Neill, adding that in absence of a potent policy, global events will continue to exert influence on India’s growth like they have in the past several decades and it will experience much more erratic cycles of growth vulnerable to global forces. Even so, he said it is still possible for India to grow close to double digits in the next 15-20 years.
