By Mirza Abdul Aleem Baig
China’s rise has been one of the most transformative developments in modern geopolitics. Over decades, the nation is transitioning from a developing country to a techno-economic power, reshaping the global balance of power.
Through rapid economic growth, sweeping domestic reforms, and strategic initiatives like the Belt and Road Initiative, China positioned itself as a key player in global commerce and diplomacy. However, there are signs that this remarkable ascent may have reached its peak, with far-reaching implications not only for China but for the global order.
Recently a significant shift has emerged, and if anything, it has been even more striking. Gradually at first and now almost universally, thought experts and specialists who follow China closely are asserting that China’s one-mighty growth engine is faltering and that the nation may no longer be on track to dominate the global stage in the coming decades.
China’s economic struggles are compounded by sluggish domestic consumption, high youth unemployment rates, rising debt levels are straining fiscal stability. Internationally, the relocation of manufacturing supply chains to countries like Vietnam and India is eroding China’s dominance as the world’s factory, further challenging its economic outlook.
For years, China defied expectations, leveraging abundant resources, favorable demographics, and a thriving global trade system to achieve unprecedented growth. These advantages, however, are now diminishing. The economy is burdened by inefficiencies, mounting debt, and resource shortages. Domestic confidence is waning, particularly among the youth, who face high unemployment and limited opportunities in what is being called the “lie-flat generation”. Wealthy individuals, meanwhile, are moving assets and families abroad, further eroding trust in China’s economic stability.
Natural resources, once a cornerstone of China’s growth, have become a major liability. Water scarcity, polluted farmland, and diminishing energy reserves have driven up costs, undermining the sustainability of the economy. Beijing now faces resource challenges comparable to those of water-scarce nations like Saudi Arabia and has become the world’s largest importer of food and energy, a stark reversal of its once-prized self-sufficiency.
At the same time, a demographic shift is intensifying these pressures. The population boom that fueled growth in the late 20th century has reversed, leaving an aging population and a shrinking workforce. Over the next decade, the number of retirees will soar while the working-age population declines dramatically, placing immense strain on social and economic systems.
China’s slowing growth has ripple effects far beyond its borders. Many countries, deeply integrated with China’s economy, are feeling the strain. Major exporters like Germany, South Korea, Brazil, and Australia, once reliant on China’s voracious appetite for goods and resources, are grappling with falling exports and declining commodity prices. Nations indebted to China through its ambitious lending programs are struggling to meet repayment demands.
Meanwhile, Beijing’s economic strategies, including flooding global markets with subsidized goods, are exacerbating tensions. These practices harm domestic industries in other countries, fostering resentment and fueling anti-China sentiment. Nations that once embraced economic ties with China are now distancing themselves due to its aggressive trade policies and geopolitical assertiveness.
The signs of a power at its peak are evident in Beijing’s domestic and international actions. Historically, countries that reach a plateau after rapid ascension often turn inward, intensifying social control, while outwardly adopting a more aggressive stance. Under Xi Jinping’s leadership, China has tightened its grip on society through surveillance and censorship. Internationally, China is expanding its military presence, asserting its dominance in contested regions like the South China Sea and the Taiwan Strait.
In response to economic stagnation, China has shifted its focus from growth to leverage, attempting to dominate critical sectors such as rare earth minerals, advanced manufacturing, and strategic trade routes. While this approach may provide short-term gains, it is isolating China further as trade partners seek alternatives. The resulting tensions with the United States and its allies have escalated into an increasingly adversarial relationship. While a cold war scenario remains likely, the risk of miscalculation and military escalation is real.
Despite these challenges, the possibility of a peaceful resolution remains. China’s future leadership may recognize the need to prioritize domestic stability and economic reform over aggressive geopolitical ambitions. Similarly, the United States and its allies must find ways to engage constructively with Beijing while maintaining clear boundaries. The global community faces the urgent task of navigating this complex and precarious period without sliding into open conflict.
China’s rise has redefined the world, but its trajectory is now shifting. The era of unchecked growth and straightforward economic partnerships has given way to a more challenging and uncertain phase. Whether this transition leads to cooperation or conflict depends on the decisions of global leaders. The next chapter of geopolitics will be shaped by the ability of nations to adapt to these realities with vision, restraint, and a commitment to shared stability.
Author: Mirza Abdul Aleem Baig – An independent observer of global dynamics, the intricacies of geopolitics and the interplay between international relations, foreign policy and strategic alliances that are shaping the new world order.
(The opinions expressed in this article are solely those of the author and do not necessarily reflect the views of World Geostrategic Insights).