Transitioning Power through Geo-economics: The Rise of China and Challenges to the United States Economic Hegemony

Abstract

The ‘Rise of China’ is considered the most significant development of the 21^st century. It has changed the nature of power transition in international politics. Unlike previous changes in the global distribution of power and prestige through violent means, China is adopting peaceful options to materialize the change in its favour. The ‘tides of history’ concept propagated by Charles Duran is happening to benefit China.  Two strategies are crucial for China in this regard. Firstly, the concept ‘Tianxia (All Under Heaven)’ creates prospects for a positive-sum game. Secondly, the adoption of geoeconomics to propagate its national interest by application of economic aspects instead of destructive geostrategic approaches. However, the transition which is happening at both regional and global levels creating challenges for the economic hegemony of the United States as well. For example, the creation of ‘The Asian Infrastructure Investment Bank (AIIB) is successfully challenging the United States (US) backed ‘International Monetary Fund (IMF), and the initiation of ‘One Belt One Road (OBOR) is creating China’s hard and soft power prospects along traditional ‘Silk Roads’, the horn of Africa, Southeast Asia, South Asia and Latin America. Due to all these changes at regional and global levels, the world seems to enter a new ‘geoeconomic order’ led by China to reshape the global economy, patterns of interactions and the existence of an American-dominated ‘rule-based order’.