Is China's "rise" all it seems?(Asia)(Country overview)

CHINA'S RISE is one of the more exciting political and economic stories today. It has had explosive economic growth for two decades. Its glittering cities, like Shanghai, dazzle visitors and will cast China's spell over many more during the 2008 Olympics. China's trade and investment have a significant impact around the world, while the energy and dynamism of the Chinese people impress anyone who has dealings with them, as they always have. It is hugely in China's interests, and those of East Asia, that its "peaceful rise" should bring growing prosperity at home and contribute to East Asian and Pacific stability and welfare.

Yet its economic policies, and its heavy spending on defence and intelligence, have raised disquiet in various quarters in the West.

Most of the excitement, whether about China's trade or currency, or over security issues, is overdone. Behind the glitter, China faces serious challenges. It is not that China will necessarily fail to deal with them--though a failure to cope is by no means inconceivable. It is rather threefold. First, analysis of the challenges underlines the contention of senior Chinese officials that the overwhelming priorities for their central administration are domestic rather than foreign or strategic. Second, there are large and sometimes alarming trends which must have profound effects on every aspect of Chinese life and politics. Third, all that has important consequences for the way in which China conducts relations with the outside world.

To start with, the population has doubled, perhaps almost tripled, since 1945. This growth has produced an awed impression abroad, especially in business circles, of China's weight and greatness, not to mention its attraction as a market, target for investment, or source of cheap goods. But never before has any country tried to govern 1.3 billion people from a single centre or experienced such a population explosion without severe social stress.

Some of these stresses are easy to identify. The additional hundreds of millions need housing, food and work. That has fuelled domestic migration from the countryside to the cities. Western estimates suggest that 150 to 200 million folk have so far left the countryside to crowd into cities in search of work and a better life. Indeed, the government plans to re-house 400 million people into new urban centres. Meanwhile policies to limit numbers, especially through the one-child-per-family rules, have been enforced with considerable violence in places, especially in the countryside. Official methods have included forcing abortions and sterilisation.

Combined with the traditional Chinese preference for boys rather than girls, the policy has changed China's demographic balance. There are severe imbalances between males and females in younger age groups, and anywhere from 30 to 100 million younger men who have no hope of finding a wife. That is all too likely to lead to trouble. The inevitable cosseting of single children might also lead to large changes in the very structure of the family, traditionally the bedrock of Chinese society, which has for two and a half thousand years been based on Confucian ideas about obedience and hierarchy. It will also produce--indeed has already produced--a workforce of declining numbers, which will make productivity increases even more urgent and accentuate the problems of looking after the growing numbers who are living longer.

These developments, combined with the growth of industry, have produced a serious shortage of water. So much of it is being taken from rivers for the ravenous needs of cities and industry--whose use is massively wasteful and inefficient--that even the Yellow River, the very cradle of Chinese civilisation, sometimes now fails to reach the sea. Or there is the problem of Northern China and its 500 million or so people. Agriculture there is already dependent on underground aquifers for up to 75 per cent of its water. Recent estimates suggest that the water levels in some have dropped by twenty metres, in places even forty. (Subsidence is actually sinking cities like Shanghai.) Western experts have suggested that some aquifers could run dry by 2020 or so. What then? Most discernible solutions involve vast infrastructure investment, whether in water treatment and purification, in canal or pipeline systems, perhaps desalination. One partial solution is to draw more on the Yangzi, or more heavily on the Tibetan ice reserves. But drawing more on Tibet could reduce water flows not just for China's own south and east, but to South-East and South Asia, whose rivers rely equally on Tibet and the Himalayas and some of whose governments have already protested about reduced ...