China's Approach to “Reset” System of Global Economic Governance in the Context of Structural Power Theory

Abstract

Globalization, which contributed to the maintenance of the neoliberal world order, slowed down after the Asian Financial Crisis in 1998 and the World Financial Crisis of 2008, when the existing system of global economic governance was unable to support developing countries, strengthening the trend towards regionalization and localization. China, acting as a rising power in the process of “power transition,” has focused its efforts on transforming the system of global governance that has so far provided US hegemony. While initially successfully using globalization for integration into the world economy, China has changed its role in the system of global governance and has become empowered to establish and maintain new global governance structures. China adopted a strategy of expanding its activities in traditional international institutions (UN, WB, IMF) and establishing parallel international institutions (BRI, AIIB) to push forward its perspective of the world order. The US adopted a strategy of decoupling to limit Chinese capabilities in its sphere of influence in response to China's economic rise. On the one hand, this led to the emergence of trade and techno-economic blocs, but on the other hand, China's approach preserved the possibility of participation in its institutions for countries which are considered to be the “core” of the existing economic order (G7, G20, OECD). The author concludes that in the present context China adheres to a non-conflict asymmetric approach to reforming the system of global governance in the economic sphere, which implies global distribution of norms through the UN, G20 and BRICS and re-globalization of global trade through intensification of regional cooperation with Asian, African and Latin American countries within the framework of the BRI, forums for cooperation between regional organizations and China, and integration of developing countries into parallel financial institutions.