All set for capitalism à la chinoise?
Photo by CHUTTERSNAP on Unsplash
It’s entirely possible that we will look back at the last week of September in the year 2025 as a hinge moment in history.
It’s the week China told the world it had a heart as well as a head and demonstrated this by despatching Premier Li Qiang to the United Nations General Assembly with a message: China will voluntarily give up its access to Special and Differential Treatment under ‘developing nation status’ (though it intends to keep its status as a developing nation).
That’s a pretty big deal. It means that China is voluntarily walking away from potentially sizeable trade benefits.
It helps that China is a $19 trillion economy and accounts for 20 per cent of global GDP but still…why did it do this? And why now?
Trade expert Dmitry Grozoubinski wrote in International Intrigue that it was a “smart” move because it “demonstrates significant symbolic willingness to sacrifice for the sake of the multilateral system, but comes at a very low price”.
This because there aren’t any negotiations underway at this point in time (nor any on the horizon), where the Chinese could leverage special treatment as a ‘developing country’. It’s a “PR coup”, Mr Grozoubinski noted, because it will be seen “as a magnanimous and constructive gesture”.
Add to that the timing of China’s announcement. It came around the time the US president was mocking the United Nations, telling
member states their countries were “going to hell” and complaining about the UN’s allegedly broken escalator and teleprompter.
Meanwhile, China was showing selflessness and winning praise from the World Trade Organisation’s Director General Ngozi Okonjo-Iweala.
The year as a whole has been rather good to China. Under Donald Trump, America is remaking capitalism with distinctly Chinese characteristics. As Thomas Klein recently wrote in a Luxembourg paper, Trump’s
America is swiftly approaching “a form of state capitalism à la chinoise”. He said, “it starts with state holdings in companies” and soon “once-independent institutions such as anti-trust authorities become levers for expanding presidential power”.
While it is “too early to declare ‘American-style socialism’”, it’s fair to say in one of the “motherlands of capitalism the market is increasingly retreating”.
