As global economic center of gravity is shifting and the US is losing hegemony, China's re-emergence as a global power is tied to its participation in various international institutions

Since the end of the Cold War, China has sought to play an increasingly important role in global economic policy. This role is a subject of interest within the framework of global dialogue.

The most important feature of the current and foreseeable international geopolitical system is the geostrategic competition among great powers. According to the Military Balance of 2022, China's defense spending in 2022 accounted for 1.6 percent of its GDP and the US' defense spending was 3.45 percent of its GDP.

In other words, the US spent three times more on defense than China. On the other hand, in terms of GDP, the US reached $25.44 trillion, while China's GDP was $17.96 trillion in 2022, according to the International Monetary Fund. This means that China's GDP represents 70.5 percent of that of the US. The US ranks first while China is second globally in terms of GDP size.

Throughout history, there are few examples of what is currently happening in global geopolitics: the US, which has been the undisputed leader of the international power system for over 70 years, designing a world order to its advantage, is unilaterally relinquishing its global leadership without being deprived of its accumulated power by any other actor.

What history teaches us in such cases is that when a great power vacates geopolitical spaces of various kinds, these power vacuums are filled by rivals, who impose different values, criteria or geopolitical rules, establishing new regional or international power relations that are different and even contrary to the previous ones.

For instance, the US has refused to approve reforms to the IMF and the World Bank for more than nine years; it does not support peace negotiations in the Russia-Ukraine conflict; it withdrew from the Trans-Pacific Partnership; it opposes economic globalization; it supports Israel in its genocide against the Palestinian people, and vetoes any United Nations resolution to achieve peace in the region; it questions NATO's collective defense principle; and it withdrew from the 2015 Paris Agreement on climate change.

China's rise and its economic dynamism are first linked to achieving significant levels of autonomy, political-strategic strength and basic well-being in health and education as a result of the 1949 revolution. Then, with the reforms and opening-up starting in 1978, China attracted capital from its diaspora, absorbed the lower levels of Japanese outsourcing, developed significant communal and State economic frameworks, and later, absorbed large volumes of Western capital under its conditions, ultimately becoming the world's major industrial platform.

China and the Asia-Pacific region's growing role in the global sphere indicate a critical change in the world power map, with implications for Latin America and the Caribbean. This change reflects the crisis of a historical cycle of hegemony led by the US since World War II. Global order crises create new tactical and strategic margins for the emergence of processes of insubordination in the periphery, whose peoples seek to break, modify, or weaken dependency relations and undertake more autonomous development projects. Therefore, it is crucial to identify the underlying trends in China's rise, the Asia-Pacific region, and their impact on the current global and regional order.

Another central dimension to situate the proposed topic in the Latin American and Caribbean context is geopolitics. Despite not seeking conflict with the US, China has counterbalanced US power, taking advantage of strategic gaps and mistakes in its relations with the region. In strengthening China-LAC relations, it is worth mentioning the importance and support given to the Community of Latin American and Caribbean States. This was evident in the CELAC meeting in Chile in 2018, where the region renewed its commitment to the strategic initiative of the "New Silk Road" or Belt and Road Initiative, positioning China as a connector of the region through a global mega-project. Additionally, Beijing has promoted trade agreements with several LAC countries and groups. China's leadership role in the BRICS has opened new economic-financial relationship spaces for the region and supported new areas of cooperation.

Regarding financial matters, a key figure showing China's influence in the region is that its public banks have loaned more resources to LAC countries than the World Bank and the Inter-American Development Bank in this decade. Furthermore, as part of its strategy to internationalize the yuan and expand financial influence, China has signed currency swap agreements with Argentina and Brazil and established the first financial hub for the internationalization of the renminbi in Santiago, Chile.

China's economic projection not only challenges the US hegemony, now entering its terminal phase, but also questions Western imperialism and potentially threatens the very dominance of capitalism. At the same time, other factors are reconfiguring the new global economic order. These include hegemonic crisis and transition, as well as new actors and regions on the global stage.

We are witnessing a process of structural change or economic transition, marked by a shift in the global economic center of gravity from central powers to "emerging "economies, a technological transition to robotics, information and communications technology, artificial intelligence, and new materials, a political rise of Global South countries, a geopolitical shift from the Atlantic to the Pacific, and a cultural or civilizational transition seeded in the crisis of the modern Western values and ideas.

All of this manifests in the relative loss of US hegemony, the decline of developed countries' monopoly on advanced high-end production and high-value-added services, economic competition between China and the US, and the rise of new global actors. China's re-emergence as a global power is tied to its interest in, acceptance of, and participation in various international institutions. From this perspective, China can be considered a driver of positive change within the international system.

The author is vice-president of the Agency of Social and Humanistic Sciences at the Ministry of Science, Technology and Environment, the Republic of Cuba. The author contributed this article to China Watch, a think tank powered by China Daily.

The views do not necessarily reflect those of China Daily.

Contact the editor at editor@chinawatch.cn.