Chinese Economic Miracle

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This overview is an attempt to provide a more balanced look at modern China, exploring its economic, technological, and social advancements while addressing common misconceptions.

China: Key Facts

• Capital: Beijing
• Largest city: Shanghai (million)
• Population: 25 million (2025)
• Official language: Standard Chinese
• GDP (ppp): 40.7 trillion (IMF 2025)
• GDP rank (ppp): 1
• GDP per capita (ppp): 28,978 USD
• GDP per capita rank: 72
• Export partners: USA 13%, Hong Kong 8%, Japan 5%, Germany 5%, S. Korea 4% (2023)
• Import partners: S. Korea 7%, USA 7%, Japan 6%, Australia 6%, Russia 6% (2023)

Economic and Industrial Power

China is currently the world's leading economy by GDP purchasing power parity (ppp), although it is still widely cited as the second-largest in nominal terms. The country remains the world's largest manufacturer, shifting toward high-value-added production while maintaining its strength in traditional industries. The decision by many companies, including Apple, to manufacture in China is not due to low labour costs, but rather the availability of a large and highly skilled workforce, especially in advanced tooling. This manufacturing power also contributes to China's large carbon footprint, though much of this pollution comes from producing goods primarily for export to world markets.

China is a major player in the Electric Vehicle (EV) market, with prominent companies such as BYD, Nio, and Xpeng expanding into European markets. These brands face challenges in North America due to trade restrictions. Additionally, Chinese smartphone brands like Huawei, Xiaomi, Oppo, and Vivo hold significant market share, particularly in Asia, Africa, and parts of Europe, though they face Western sanctions and restrictions.

Technological and Scientific Advancement

China has one of the world's largest and most advanced 5G networks, with continued development alongside other Asian tech leaders like South Korea. The country is rapidly emerging as a global leader in AI research and development, as well as in its application across sectors such as healthcare and finance. China is also a global leader in renewable energy technologies, including solar panels and wind turbines. 

In recent years, China has surpassed the U.S. in total R&D spending In ppp terms, though the U.S. still leads in per capita expenditure. The country has also taken the lead in scientific output, as measured by the number of published papers. It has the world's largest high-speed rail network, with trains like the Fuxing series reaching speeds of up to 350 km/h, comparable to Japan's Shinkansen.

While China is accelerating its semiconductor chip production, high-end self-sufficiency remains a goal, partly due to U.S. export controls on cutting-edge chip technology. Other areas of significant growth include biotechnology, robotics, quantum computing, space exploration, and medicine.

Society and Urbanization

China has a growing middle class, leading to increased spending power, but the country is also grappling with rising social inequality and a widening wealth gap. Many Chinese cities have undergone rapid modernization with advanced infrastructure and skylines that rival those of major global cities. The implementation of Smart City technologies aims to improve urban management and quality of life. While China's mass surveillance is often cited as evidence of an authoritarian nature, Western countries are not necessarily any less advanced or pervasive in that regard. Similarly, the Chinese Social Credit System is frequently misrepresented as a single, national program when it is, in fact, a fragmented mix of local and corporate pilot projects.

Many Westerners lack first-hand experience of China, but awareness of its urban development is increasing. However, some still find it difficult to accept that major Chinese cities now surpass Western cities in several key respects. For example, Western cities like Vancouver and Philadelphia are grappling with growing issues of homelessness and drug addiction, which are less visible in China, where the home ownership rate is among the highest in the world.

Global Presence and Diplomacy

China is actively expanding its diplomatic influence, particularly in Africa and Southeast Asia, through ambitious projects like the Belt and Road Initiative (BRI). Chinese projects in Africa are often depicted in Western media as debt traps. This view, however, overlooks the agency of African nations in negotiating these deals and the potential benefits of improved infrastructure. Many Africans have a different perspective, often viewing Chinese engagement as pragmatic and focused on tangible results. A common saying illustrates this point: "Each time the Chinese come, we get a hospital; each time the Westerners come, we get a lecture!"

In terms of military, China has made significant advancements in drone, missile, and military space technology, though the U.S. currently maintains its lead in the latter. It has an increasing naval presence in the South China Sea. Military modernization and expansion efforts are, in part, a response to the presence of U.S. and allied military bases in the Asia-Pacific region. Most Westerners tend to overlook that Western-aligned military forces are positioned near China, while Chinese forces are not located near Western cities, a fact that contributes to military tensions.

Conclusion

China’s rise is neither an anomaly nor a fleeting trend but part of a broader shift toward a multipolar world. Its economic strength, technological innovation, and global engagement challenge older hierarchies and force a reassessment of long-standing assumptions. The West, which once championed free trade and market-driven growth when it was advantageous, now often criticizes China for employing the same strategies. Understanding this transformation requires moving beyond outdated narratives and placing it within the larger cycle of global power transitions, a perspective explored in a classic text by A.F.K. Organski titled The Stages of Political Development: A New Theory of the Rise and Fall of Great Powers (1984).

Video

A look into the rapid urbanization and economic transformation of China [2h 5m 15s]

The documentary delves into how China's swift urbanization, spurred by massive government investment, has transformed the country's landscape, economy, and society. It highlights the creation of new cities, the modernization of old ones, and the immense construction boom, showcasing projects like the Shanghai Tower. The documentary also examines the social and environmental costs of this rapid development, and explores how the country is innovating to find sustainable solutions and redefine its global role.

Bonus content: Apple CEO Tim Cook talks about the Chinese human capital in 2017: https://www.youtube.com/watch?v=L9f5SQQKr5o

Discussion

1. Discuss the concept of economic miracle as it applies to China's development. What criteria should be used to evaluate whether a nation's economic transformation constitutes a genuine miracle versus expected growth patterns? Consider both quantitative metrics and qualitative changes in society and governance.

2. Debate the implications of China surpassing the U.S. in total R&D spending and scientific output. What does this mean for global leadership in technology and innovation, and how might it influence future economic competition?

Critical Thinking

1. Analyze the framing of China's technological advancement as either legitimate development or unfair competition. What assumptions about free markets, state intervention, and international economic rules inform these different interpretations?

2. Investigate the assumption that economic growth necessarily leads to political liberalization. What historical and theoretical foundations underlie this expectation, and how might different political economy frameworks challenge or support this assumption?

Further Investigation

1. Compare and contrast the economic development strategies employed by China with those of other major economies during their periods of rapid growth, such as Japan in the 1960s-80s or South Korea in the 1980s-90s. What similarities and differences emerge in their approaches to industrialization, technology transfer, and global market integration?

2. Investigate the historical patterns of global power transitions and examine how China's rise compares to previous shifts in international hierarchy. What factors have historically determined the success or failure of rising powers, and how might these patterns apply to contemporary geopolitics?

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