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  • The world is changing

  • with really remarkable speed.

  • If you look at the chart at the top here,

  • you'll see that in 2025,

  • these Goldman Sachs projections

  • suggest that the Chinese economy

  • will be almost the same size as the American economy.

  • And if you look at the chart

  • for 2050,

  • it's projected that the Chinese economy

  • will be twice the size of the American economy,

  • and the Indian economy will be almost the same size

  • as the American economy.

  • And we should bear in mind here

  • that these projections were drawn up

  • before the Western financial crisis.

  • A couple of weeks ago,

  • I was looking at the latest projection

  • by BNP Paribas

  • for when China

  • will have a larger economy

  • than the United States.

  • Goldman Sachs projected 2027.

  • The post-crisis projection

  • is 2020.

  • That's just a decade away.

  • China is going to change the world

  • in two fundamental respects.

  • First of all,

  • it's a huge developing country

  • with a population of 1.3 billion people,

  • which has been growing for over 30 years

  • at around 10 percent a year.

  • And within a decade,

  • it will have the largest economy in the world.

  • Never before in the modern era

  • has the largest economy in the world

  • been that of a developing country,

  • rather than a developed country.

  • Secondly,

  • for the first time in the modern era,

  • the dominant country in the world --

  • which I think is what China will become --

  • will be not from the West

  • and from very, very different civilizational roots.

  • Now, I know it's a widespread assumption in the West

  • that as countries modernize,

  • they also westernize.

  • This is an illusion.

  • It's an assumption that modernity

  • is a product simply of competition, markets and technology.

  • It is not. It is also shaped equally

  • by history and culture.

  • China is not like the West,

  • and it will not become like the West.

  • It will remain in very fundamental respects

  • very different.

  • Now the big question here is obviously,

  • how do we make sense of China?

  • How do we try to understand what China is?

  • And the problem we have in the West at the moment, by and large,

  • is that the conventional approach

  • is that we understand it really in Western terms,

  • using Western ideas.

  • We can't.

  • Now I want to offer you

  • three building blocks

  • for trying to understand what China is like,

  • just as a beginning.

  • The first is this:

  • that China is not really a nation-state.

  • Okay, it's called itself a nation-state

  • for the last hundred years,

  • but everyone who knows anything about China

  • knows it's a lot older than this.

  • This was what China looked like with the victory of the Qin Dynasty

  • in 221 B.C. at the end of the warring-state period --

  • the birth of modern China.

  • And you can see it against the boundaries of modern China.

  • Or immediately afterward, the Han Dynasty,

  • still 2,000 years ago.

  • And you can see already it occupies

  • most of what we now know as Eastern China,

  • which is where the vast majority of Chinese lived then

  • and live now.

  • Now what is extraordinary about this

  • is, what gives China its sense of being China,

  • what gives the Chinese

  • the sense of what it is to be Chinese,

  • comes not from the last hundred years,

  • not from the nation-state period,

  • which is what happened in the West,

  • but from the period, if you like,

  • of the civilization-state.

  • I'm thinking here, for example,

  • of customs like ancestral worship,

  • of a very distinctive notion of the state,

  • likewise, a very distinctive notion of the family,

  • social relationships like guanxi,

  • Confucian values and so on.

  • These are all things that come

  • from the period of the civilization-state.

  • In other words, China, unlike the Western states and most countries in the world,

  • is shaped by its sense of civilization,

  • its existence as a civilization-state,

  • rather than as a nation-state.

  • And there's one other thing to add to this, and that is this:

  • Of course we know China's big, huge,

  • demographically and geographically,

  • with a population of 1.3 billion people.

  • What we often aren't really aware of

  • is the fact

  • that China is extremely diverse

  • and very pluralistic,

  • and in many ways very decentralized.

  • You can't run a place on this scale simply from Beijing,

  • even though we think this to be the case.

  • It's never been the case.

  • So this is China, a civilization-state,

  • rather than a nation-state.

  • And what does it mean?

  • Well, I think it has all sorts of profound implications.

  • I'll give you two quick ones.

  • The first is that

  • the most important political value for the Chinese

  • is unity,

  • is the maintenance

  • of Chinese civilization.

  • You know, 2,000 years ago, Europe:

  • breakdown -- the fragmentation of the Holy Roman Empire.

  • It divided, and it's remained divided ever since.

  • China, over the same time period,

  • went in exactly the opposite direction,

  • very painfully holding this huge civilization,

  • civilization-state, together.

  • The second

  • is maybe more prosaic,

  • which is Hong Kong.

  • Do you remember the handover of Hong Kong

  • by Britain to China in 1997?

  • You may remember

  • what the Chinese constitutional proposition was.

  • One country, two systems.

  • And I'll lay a wager

  • that barely anyone in the West believed them.

  • "Window dressing.

  • When China gets its hands on Hong Kong,

  • that won't be the case."

  • Thirteen years on,

  • the political and legal system in Hong Kong

  • is as different now as it was in 1997.

  • We were wrong. Why were we wrong?

  • We were wrong because we thought, naturally enough,

  • in nation-state ways.

  • Think of German unification, 1990.

  • What happened?

  • Well, basically the East was swallowed by the West.

  • One nation, one system.

  • That is the nation-state mentality.

  • But you can't run a country like China,

  • a civilization-state,

  • on the basis of one civilization, one system.

  • It doesn't work.

  • So actually the response of China

  • to the question of Hong Kong --

  • as it will be to the question of Taiwan --

  • was a natural response:

  • one civilization, many systems.

  • Let me offer you another building block

  • to try and understand China --

  • maybe not sort of a comfortable one.

  • The Chinese have a very, very different

  • conception of race

  • to most other countries.

  • Do you know,

  • of the 1.3 billion Chinese,

  • over 90 percent of them

  • think they belong to the same race,

  • the Han?

  • Now, this is completely different

  • from the world's [other] most populous countries.

  • India, the United States,

  • Indonesia, Brazil --

  • all of them are multiracial.

  • The Chinese don't feel like that.

  • China is only multiracial

  • really at the margins.

  • So the question is, why?

  • Well the reason, I think, essentially

  • is, again, back to the civilization-state.

  • A history of at least 2,000 years,

  • a history of conquest, occupation,

  • absorption, assimilation and so on,

  • led to the process by which,

  • over time, this notion of the Han emerged --

  • of course, nurtured

  • by a growing and very powerful sense

  • of cultural identity.

  • Now the great advantage of this historical experience

  • has been that, without the Han,

  • China could never have held together.

  • The Han identity has been the cement

  • which has held this country together.

  • The great disadvantage of it

  • is that the Han have a very weak conception

  • of cultural difference.

  • They really believe

  • in their own superiority,

  • and they are disrespectful

  • of those who are not.

  • Hence their attitude, for example,

  • to the Uyghurs and to the Tibetans.

  • Or let me give you my third building block,

  • the Chinese state.

  • Now the relationship

  • between the state and society in China

  • is very different from that in the West.

  • Now we in the West

  • overwhelmingly seem to think -- in these days at least --

  • that the authority and legitimacy of the state

  • is a function of democracy.

  • The problem with this proposition

  • is that the Chinese state

  • enjoys more legitimacy

  • and more authority

  • amongst the Chinese

  • than is true

  • with any Western state.

  • And the reason for this

  • is because --

  • well, there are two reasons, I think.

  • And it's obviously got nothing to do with democracy,

  • because in our terms the Chinese certainly don't have a democracy.

  • And the reason for this is,

  • firstly, because the state in China

  • is given a very special --

  • it enjoys a very special significance

  • as the representative,

  • the embodiment and the guardian

  • of Chinese civilization,

  • of the civilization-state.

  • This is as close as China gets

  • to a kind of spiritual role.

  • And the second reason is because,

  • whereas in Europe

  • and North America,

  • the state's power is continuously challenged --

  • I mean in the European tradition,

  • historically against the church,

  • against other sectors of the aristocracy,

  • against merchants and so on --

  • for 1,000 years,

  • the power of the Chinese state

  • has not been challenged.

  • It's had no serious rivals.

  • So you can see

  • that the way in which power has been constructed in China

  • is very different from our experience

  • in Western history.

  • The result, by the way,

  • is that the Chinese have a very different view of the state.

  • Whereas we tend to view it as an intruder,

  • a stranger,

  • certainly an organ

  • whose powers need to be limited

  • or defined and constrained,

  • the Chinese don't see the state like that at all.

  • The Chinese view the state

  • as an intimate -- not just as an intimate actually,

  • as a member of the family --