Banyan column in The Economist.
The key point:
It's economy, for all its three-decades-long boom, still only accoiunts for 8% of global GDP in current dollars; domestic private consumption, though growing fast, remains a small part of national GDP by global standards (36%). This will grow as China reforms its economy to give a bigger share to household income, for example, by lifting wages for China's factory workers . . This "rebalancing," though, could take decades. In the short term the high-speed growth much of the rest of the world has enjoyed will moderate. Growth will not be measured against the worst of the slump; and faltering recovery in the G3 will dent exports, however well China does. The golden age is not here yet.
Basic message: there is no real leap-frogging of the West by China. It got to where it stands today largely because the West could absorb its exports. That is ending by necessity and by choice--and perhaps soon enough by emotion and fear to boot.
There is no singular rise in a world of interdependencies. China needs friends far more than its recent hubris and arrogance indicate.
The world needs a new type of leadership in China no less than it does in America.