Not quite the Chinese Century, according to Clyde Prestowitz
China has been the great story of the past quarter-century and still is a good one. But the miracle days are past. China has followed a growth strategy based on huge investment, sometimes in excess of 50 per cent of GDP. It has now hit a point of diminishing returns. Each new dollar of investment yields a bit less growth than the previous dollar. For a long time the key question has been whether China would get rich before it gets old. The answer increasingly appears to be no.
Perhaps Australia would do well to commission another white paper: Australia in the New American Century.
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The second US century
So you think America is in decline and China on the rise? Think again.
by Clyde Prestowitz
Source – The Age, published May 14, 2013
Conventional wisdom says that America is in decline, that the American century is over, and that the future belongs to the rest, especially the rest in Asia. Predictions that China’s gross domestic product will soon surpass that of the US to become the world’s largest economy are legion.
Prominent authors such as CNN commentator Fareed Zakaria and former diplomat Kishore Mahbubani have rushed to publish books predicting a historic shift in the global balance of power as a result of this change in relative share of global GDP. And the Australian government recently indicated its agreement with this thinking by moving to redeploy its resources and reorient its policies in response to a white paper on ”Australia in the Asian Century”.
Yet, there is growing evidence that all of this analysis may be a bit premature and that America is not only coming back but that this century may well wind up being another American century.
Please click here to read the full article at the Age.