Zhang Yunling, a Chinese expert on international issues, is a member of the Chinese Academy of Social Sciences. He is the director of the Discipline Development Committee of the School of Northeast Asia Studies of Shandong University and the director of the Institute of International Studies at the university. Recognized as a “National Outstanding Expert” by the Chinese government, he is the author of several books, including China and the World since the Reform and Opening up and Building a Harmonious World: Theory and Practice.

A photo presents the front profile of Zhang Yunling.

Zhang Yunling

With the world undergoing profound changes, which are creating both challenges and opportunities, what is a way out of the chaos? Is globalization dead? Will there be a power shift in the global order? Zhang Yunling shares his analysis based on his study of China and the rest of the world.

CNS: Is globalization dead?

Zhang Yunling: Globalization is a typical feature of today’s world, and few countries can remain aloof from it. But in recent years, anti-globalization and reverse globalization voices, forces and actions have sprung up and some claim that globalization is dead. In my view, globalization is not dead, but has entered a new period of adjustment as there’s something wrong with it.

First, there’s regional imbalance and industrial structure imbalance. Interdependence, opening up, industrial chains and supply chains are conducive to division of labor and participation as well as economic growth. However, over-migration will lead to imbalance. For example, a large wave of out-migration will lead to the problem of industries “hollowing out”; that is, after an industrial out-migration, the original industrial belt will decline if there is no new industry to replace it. Industrial restructuring and transfer is necessary, but it needs to be supported by policies that will promote the development of new industries and fill the “hollow.” The Chicago area of the United States is the base of traditional industries. After the industrial transfer, there was no replacement and renewal, and it became a declining “rust belt,” where the voice of anti-globalization is loud.

Second, the security of development. According to the economic theory, the longer the supply chain, the better since a finer division of labor improves efficiency. But the outbreak of the COVID-19 pandemic created the problem of supply cuts. Industries with the most detailed industrial chains, such as the automobile industry and electronic products, bore the brunt of the disruptions.

In this situation, enterprises and governments began to rethink, fearing that they could not rely on external support in everything but needed to ensure the basic supply on their own. To this end, a series of measures and policies were introduced. The United States politicized development and security issues and tried to decouple China’s participation in supply chains and advanced technologies. This is a typical anti-globalization measure. All countries, governments, enterprises and individuals should undoubtedly pay attention to their own development security, but going to extremes is also harmful.

Third, the polarization of wealth. In an environment of open competition, it’s always the strong and the powerful who win. Therefore, wealth is concentrated among the strong and the powerful. The more globalized the world is, the more polarized wealth accumulation becomes. Therefore, there is skepticism and opposition toward globalization. In 2008, the subprime mortgage crisis in the U.S. led to a movement against Wall Street, which represents the gainers from globalization. There has also been a surge in anti-globalization sentiment in Europe and elsewhere.

Globalization thus has entered a period of adjustment, but openness, division of labor and the refinement of supply chains will not end, and new technologies will boost the development of new globalization.

CNS: How is globalization being adjusted?

Zhang Yunling: At the policy level, governments will pay more attention to the safe supply of basic necessities, reduce their external dependence on essential necessities, and support the return of industries. They will take measures to limit the outflow of core industries, such as core technologies, the key industries of the national economy and people’s livelihood, and strengthen the restrictions with more laws and regulations.

Many countries have begun to enact stricter foreign investment laws and restrict foreign investment in core technologies to prevent foreign investors from buying domestic companies at low prices in times of economic difficulty.

In this way, “national conservatism” based on economic, social and political security will exert greater impact. Still, no country, including the United States, is claiming to close its doors. The U.S. government is thinking more about politics and limiting the competitive power of its rivals. After all, it can maximize its own interests only by relying on the world market.

At the level of business strategies, enterprises will pay more attention to the security of their supply chains and the supply chains will be shortened for them to master the core technologies. Besides, to reduce operating costs, intelligent technologies such as robots will be used on a large scale. However, companies, especially the large ones, are paying more attention to opportunities in the international market and will not retreat to their domestic market. Instead, they will build large networks based on world markets and more enterprises will embrace the Internet of Things.

On the social level, citizens will require more from the government, demanding restrictions on the inflow of foreign capital and population for improving job security and social security. However, there will also be more people who will rely on a more open social, economic and political environment for greater and better employment and development space. Therefore, although the original liberalism will be out of power, the relationship between globalization and public interest will still be very close. Extreme xenophobic forces will not be able to win majority support.

CNS: What is the future of globalization?

Zhang Yunling: Globalization will become more “managed” or “limited.” Nonetheless, as an important part of the global economic and social functioning collective, it cannot simply be abandoned. As a process of development, globalization is adjustable, controllable and variable, but irreversible. No country, enterprise or social group can retreat into a closed so-called “tribal society.” For example, governments can support outgoing companies’ return, but they cannot force it happen. In reality, a large number of enterprises cannot go back, especially those that depend on the local market and factor resources to survive.

The COVID-19 pandemic will eventually end and the thinking, discussion, debate and adjustment of post-pandemic policies, business strategies and civic consciousness will continue for a long time. This is called the reflection and transformation of “post-liberalism.”

In the face of the global pandemic, sadness, pessimism and extreme emotions have tended to prevail, but once it ends and everything is back to normal, people will become more rational. From past historical experience, we know every major disaster provides lessons for us to become wiser and promote progress. COVID-19 is no exception.

In terms of the development of globalization, there is a new wave, namely, the construction of the Internet of Things. Driven by information, intelligent and digital technologies, it integrates various economic and social activities into it.

Globalization is not only an economic phenomenon, and the new kind of globalization will have three major features.

First, building the Internet of Things with artificial intelligence, big data and other technologies, breaking traditional national boundaries, integrating multiple factors, going beyond the existing supply chain model, and integrating small and medium-sized enterprises and individuals into the network system.

Second, market opening and balanced development will be better combined to change the “openness-only” mode led by liberalism. Developed countries pay more attention to not only the accumulation of international wealth but also the balance of domestic social economy under globalization, and other countries will also pay attention to the construction of the overall national security system, that is, to a more balanced globalization.

Third, the existing international institutions, cooperation mechanisms and platforms will be adjusted to meet the needs of actual development, especially to meet the needs of the new globalization by providing support and convenience for its development.

CNS: How will China cope with the future globalization?

Zhang Yunling: China is a beneficiary of globalization. The reform and opening up policy opened the door for China to participate in globalization, which led to rapid economic development. Therefore, China is also an active promoter and defender of globalization.

With protectionism, populism and political interventionism on the rise, China must adhere to deeper reform and opening up. For the first time since industrialization, China is leading in some respects. Both in terms of its own development needs and the world economy, China is now able to play an increasingly important role in opening up the world market and maintaining the trend of globalization.

CNS: What’s your take on the so-called power transition?

Zhang Yunling: In view of the general trend of world development, changes in power are bound to happen. Historically, power shifted from one great power to another. But today’s power transfer is different from the past, that is, the typical feature of power transfer is not power substitution, but the decomposition and dispersion of it.

When we talk about power transfer today, we mainly refer to the United States, the only superpower and hegemonic power in the world which dominates and controls the world. But will the power of the U.S. transfer to another country? I don’t think so.

With diversified development, no country can control the future alone. International and regional organizations such as the UN will play an important role in managing the world. With the increasing complexity of global affairs, the role of non-state actors such as enterprises, individuals and non-governmental organizations is becoming more and more important. In some areas, the state cannot dominate and has to rely on multinationals.

If the transfer of power is viewed from a new perspective, there would be no Thucydides Trap. A new discourse system in theory and public opinion needs to be established. In terms of international changes, it is impossible to blame everything on China-U.S. relations.

During the Cold War, the Soviet-American confrontation affected the world deeply as it created two power blocs, each with a leader. Now we have neither the blocs nor the leaders. Most countries do not want a confrontation between China and the United States. They do not want to be involved in any bloc as they have mutual interests with both the United States and China.

Therefore, if we still view the world from old theoretical perspectives and link all issues to China-U.S. relations, we will find no way out at all. Therefore, we must analyze the world from a multi-faceted, multi-layered and multi-directional perspective.

China, for its part, needs to consider the effects of its peaceful rise and increase the transparency and integration of its strategy and goals. To realize the Chinese dream of the rejuvenation of the Chinese nation, we must make it understandable and acceptable to others and avoid strategic misunderstandings and miscalculations.

As a resurgent power, China expects to take center stage in the world, but there will be others there, too. This is another prominent feature of the power shift in the new era.

(Interviewed by Yang Bing, Wen Longjie and Wang Jiaoni)