The guiding theme of this book is that East Asia’s reemergence as a semi-autonomous core of the world economy constitutes one of the most significant structural changes in world politics since the Industrial Revolution and Eurocentric globalization in the nineteenth century. Thanks to a regional developmental dynamic of remarkable intensity, duration and spatial scope, which spread from Japan to the rest of the region, East Asia is gradually regaining the position in the world economy that it enjoyed prior to the great East-West and North-South divergence, commensurate with its demographic weight.
Over the past four decades the region’s share of world Gross Domestic Product (GDP), in purchasing power parity (PPP), has risen from less than 10 percent to 30 percent, a ratio that should rise by 2030 to just over 40 percent. China has become the world’s second-largest economy in current exchange rates (the largest in PPP). Since 1980 its share of world GDP (PPP) has risen from 2% to over 16%. Though growth has recently slowed due to the global contraction that followed the 2008 financial crisis, China remains on an ascending trajectory: average per capita GDP (PPP) has risen from $250 in 1980 to $9,800 and is expected to reach $16,000 by 2020. Assuming steady but slower growth going forward, per capita GDP should reach current Japanese or European levels by the mid-21st century.
China has simultaneously become the gravitational center of new transcontinental South-South trade and investment linkages, supplanting the United States, Europe and Japan as the leading trade partner of most East Asian countries, and becoming a crucial actor in South American, African and South Asian trade. Over the past twenty years South-South trade has expanded more rapidly than global trade, currently accounting for 25 percent of the total, 21 percent of manufacturing exports, and 25 percent of exports of manufactures with medium and high technological intensity. In many cases, notably in East Asia itself, this has been accompanied by industrial upgrading: the “developing” world’s share of manufacturing value-added has risen from less than 10 to nearly 30 percent.
The politics of postcolonial reemergence have lagged behind economics but a gradual political reordering is apparent in the growing voice of the South in international organizations and new institution-building efforts bypassing traditional centers of power and authority. In 2013, Brazil, Russia, India, China and South Africa set up the New Development Bank (NDB), headquartered in Shanghai, which will combine investment and monetary functions, serving as a lending institution for infrastructure development projects as well as a reserve facility dealing with balance of payments problems. In 2014, China founded the Asian Infrastructure Investment Bank (AIIB). The creation of a distinct institutional system separate from the Bretton Woods institutions that have underpinned world capitalism since 1945 has major implications: from now on rules and regimes will no longer be exclusively set in the historic North.
The East Asian economic revolution, in short, is reshaping the global landscape. Though “revolution” has always been a problematic concept to describe the cumulative effects of technological, economic and social change, I use it not only to denote the relatively sudden, considerable and sustained increases in the rate of growth that the region has experienced, but also and more broadly its systemically transformative effects. Like the European Industrial Revolution, the East Asian one is gradually changing the order of the world. As the United Nations Development Programme (UNDP) emphasizes: “The world is witnessing an epochal global rebalancing. The rise of the South reverses the huge shift that saw Europe and North America eclipse the rest of the world, beginning with the industrial revolution, through the colonial era to two World Wars in the twentieth century. Now another tectonic shift has put developing countries on an upward curve”.
The book explores the sources of that shift and interrogates its implications for understandings of globalization and capitalist development. Using a historical sociological approach to the study of world politics, it weaves together social theory and historical narrative to analyze the structural and contingent factors that gave rise, during distinct but interconnected moments of world history, to the East Asian development dynamic.
Moving from present to past and past to present the book examines the early modern European-Asian encounter, the imperial collisions of the nineteenth century, ‘Pax Americana’ and the post-war constitution of authoritarian capitalist developmental states, and China’s state-capitalist turn in the late twentieth century. The focus is on the ways in which imperialism, war and revolution shaped modern nation and state building efforts—the international interactions that generated state forms in the nineteenth and twentieth centuries which, to varying degrees, have proved able to harness transnational forces to national institutions and purposes, and to successfully alter national positions in the global economic hierarchy.
Major challenges lie ahead. For observers concerned with the problem of international inequality, such as this author, global rebalancing is normatively desirable. But because it implies intensified competition for resources, capital, status and voice it carries not insignificant political and economic risks. At the same time capitalist development has generated new social fractures and environmental problems. These problems need to be addressed to create the conditions for a sustainable and peaceful future.