The US should counter China’s dominance in the Global South with trade, not more arms

The US still has distinct advantages, including, critically, a growing population. But it must ease off sanctions and its single-minded focus on security
Instead, it must present the developing world with more broad-based economic cooperation and a return to globalisation

Mohamed Zeeshan

Published: 7:30pm, 15 Sep 2023

Why you can trust SCMP

Brics, the bloc compromising Brazil, Russia, India, China and South Africa, has long been accused of geopolitical incoherence and irrelevance. The five countries differ among themselves on several global questions and have varied equations with the West, ranging from friend to foe.

Yet, that incoherence has not dimmed the developing world’s interest in joining them. Last month at the Johannesburg summit, the grouping inducted six new nations from Asia, Africa and Latin America. Over 40 countries across the Global South had expressed interest in membership in recent years.

Much of this momentum might reasonably be credited to China’s growing global footprint. China enjoys almost unrivalled clout in the developing world. The induction of Iran and Saudi Arabia, for instance, had been preceded by a monumental thaw brokered by Beijing.

Meanwhile, Russia, long a security player in Africa and the Middle East, has been considerably weakened by the Ukraine war. In recent months, it has staved off an attempted rebellion in Moscow and is witnessing turmoil within the influential private militia, Wagner Group, an important player in Africa and Ukraine.

At first glance, India, which hosted the G20 summit last weekend, seems to be doing much better. But New Delhi, too, is increasingly beset by internal security problems, some of which are testing its ability to counterbalance China militarily and economically. Following ethnic conflict in the northeastern state of Manipur this year, India had to divert troops away from its contentious border with China to deal with that crisis.

India also remains far behind China on almost all economic parameters and lacks a framework to rival China’s role in the Belt and Road Initiative and Asian Infrastructure Investment Bank.

06:32

China’s Belt and Road, 10 years on

If there is one country still in a position to compete with China’s influence in the developing world, it’s the United States. America still enjoys distinct advantages over China.

Perhaps the most important one is demographics. Driven by sustained immigration flows, America’s population is expected to keep growing in the decades ahead, even as China, Europe and India start ageing and declining. A new Bloomberg forecast suggests that China’s gross domestic product may not overtake America’s until the mid-2040s, and even then, the lead will be marginal before “falling back behind”.

So far, America has not leveraged these advantages sufficiently. China’s burgeoning influence in the developing world increasingly stems from it being the only major power able or willing to present economic cooperation. And Beijing’s refusal to indulge in value judgments on political and social issues make it an attractive partner to many.

By contrast, America’s vision increasingly feels less economic and more militaristic. Trade protectionism in US politics has been a sore challenge. The much-vaunted Indo-Pacific Economic Framework was criticised for not going far enough in terms of providing greater access to the US market. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership, originally an Obama initiative, remains a non-American affair.

11:11

CPTPP could become game changer and supplant 'out-of-date' WTO, after mainland China, Taiwan apply

In 2019, America suffered a further strategic blow when India – a country that Washington counts on to counterbalance China – chose to sit out of the Regional Comprehensive Economic Partnership. The trade bloc comprised much of the Asia-Pacific, and China looms incomparably large within it – almost five times as populous as the second largest member, Indonesia, and four times as large an economy as the second biggest, Japan.

So Beijing’s economic influence in Asia remains largely uncontested.

Washington has instead focused on Taiwan and bolstering security ties with allies such as India, Japan and the Philippines. But that has only made many countries in the region more anxious as they try to balance ties between China and the US.

The ubiquity of sanctions in US policy has also been divided the developing world. According to the US Treasury Department, by 2021, Washington had imposed more than 9,000 sanctions. That year, Biden added 765 more. US-sanctioned countries make up over one-fifth of global GDP.

How sanctions on Russia risk mass destruction of the global economy

America’s widespread use of sanctions has inadvertently added to China’s attractiveness as an economic partner to the Global South. Part of the allure of Brics stems from a desire to reduce dependence on the dollar. Earlier this year, Brazil’s President Luiz Inacio Lula da Silva asked why all countries must base their trade on the dollar. India has begun to shift several parts of its trade away from the dollar.

There are legitimate reasons the US has prioritised military goals over economic ones. Domestic politics is a key factor. In the wake of sustained trade protectionism and rising anti-immigration sentiment, Washington has found itself unable to champion a more open and globalist economic vision for the world.

But that has meant a single-minded focus on security matters, which has made the defence industry the key driving force behind US engagement with the world. In its last fiscal, US arms exports surged by a 49 per cent.

For many countries in the developing world, that feels like a mismatch in priorities. To compete with China, America should instead present them with opportunities for more broad-based economic cooperation and a return to globalisation.

Mohamed Zeeshan is a foreign affairs columnist and the author of Flying Blind: India’s Quest for Global Leadership