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Thursday, September 02, 2010 20:26
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ECONOMY
The Dawn of the Chinese Century?
Emad Mekay
WASHINGTON, Feb 16 (IPS) - China is quickly overtaking the United States as the world's biggest consumer of global resources, energised by a dynamic economy that is growing at a record pace, says a Washington research group.
"China is no longer just a developing country. It is an emerging economic superpower, one that is writing economic history," said Lester Brown, founder of the Earth Policy Institute and author of Wednesday's report. "If the last century was the American century, this one looks to be the Chinese century."
The report points to China's increasing consumption patterns and expanding influence on the U.S. economy. Brown says these trends are an early warning that China's rapid growth could lead to a globally unsustainable use of resources.
"At one time it wouldn't have been credible even to ask these questions, but now that China has passed the U.S. in aggregate consumption and given the greater momentum for its growth, it sort of gives one licence to think about what if they reach U.S. consumption levels in per capita terms," Brown told IPS.
"What we are learning from China is this: the Western industrial development model is not going to work for China and therefore for the world - that is, a fossil fuel-based, automobile-centered, throwaway economy," Brown said.
For example, if paper use per person in China were to reach the U.S. level, China would need more paper than the entire world produces, he said.
"They have sort of done that on the national level for a lot of the key resources," he said. "But what if they do it per person, which means expanding consumption something like four-fold over what it is today?"
The report says that China is outpacing the United States in four of the five most important commodities: grain, meat, coal and steel. The fifth, oil, is still consumed in the United States at rates triple that of China, about 20.4 million barrels per day.
But while oil use in the United States rose by 15 percent from 1994 to 2004, use in the Asian giant more than doubled. China has now surpassed Japan as the world's second largest consumer of oil after the United States, said the report, titled "China Replacing United States as World's Biggest Consumer".
China also consumes about 800 million tonnes of another fossil fuel, coal, which meets nearly two-thirds of the country's energy demand.
"With its coal use far exceeding that of the United States and with its oil and natural gas use climbing fast, it is only a matter of time until China will also be the world's top emitter of carbon," says the report. "Soon the world may have two major climate disrupters."
Chinese consumption patterns are rising in other categories. It has opened a wide lead with grain: 382 million tonnes, compared to 278 million tonnes for the United States last year. Among the three big grains, the world's most populous country leads in the consumption of both wheat and rice, and trails the United States only in corn.
Among leading consumer products, China trails the United States only in automobiles. By 2003, it had 24 million motor vehicles, scarcely one-tenth of the 226 million on U.S. roads. But with car sales doubling over the last two years, China's fleet is quickly catching up.
Currently, China imports vast quantities of grain, soybeans, iron ore, aluminum, copper, platinum, phosphates, potash, oil and natural gas, forest products for lumber and paper, and the cotton needed for its world-dominating textile industry.
These massive imports have put China at the center of the raw materials economy. Its huge appetite for materials has driven up not only commodity prices but ocean shipping rates as well.
China's use of steel, a key indicator of industrial development, has also soared. Steel consumption is now more than twice that of the United States, driven by urban migration and the construction of thousands of factories and high-rise apartment and office buildings.
The United States still maintains a wide lead over China in terms of individual consumption patterns, mainly due to its much lower per capita income of 5,300 dollars - about one-seventh the 38,000 dollars of the United States.
However, the report predicted that as Chinese incomes rise at a record pace, use of foodstuffs, energy, raw materials, and sales of consumer goods would continue to climb.
The report also examines China's growing influence on the U.S. economy, which has become heavily dependent on Chinese capital to underwrite its fast-growing debt. If China ever decides to divert this capital surplus elsewhere, either to internal investment or to the development of oil, gas, and mineral resources elsewhere in the world, the U.S. economy will be in trouble, the report says.
China's record-high domestic savings and huge trade surplus with the United States are just two of the most visible manifestations of its economic strength. It is now China, along with Japan, that is buying the U.S. treasury securities that enable the United States to run the largest fiscal deficit in history.
"China's eclipse of the United States as a consumer nation should be seen as another milestone along the path of its evolution as a world economic leader," Brown said.
(END/2005)
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