Hi everyone, I'd like to start by thanking the organizers

for this excellent venue, for a very important discussion.

It is my great pleasure to share with all of you

some of my thoughts on the future of China.

I wish I could say the same thing as what Kevin Rudd said,

"I'm here to help."

But somehow, predicting the future is a very difficult task.

First, social scientists are not very well equipped to predict the future,

as we've seen in the collapse of the Soviet Union,

the financial crisis in East Asia, and so on and so forth.

Another reason is that black swans actually show up, so it's very difficult.

Particularly, when it comes down to China, the future of China,

the challenge is much more daunting,

and I have to talk about it in just 15 minutes.

So I'll try my best to give some answers.

These are the two cartoons that I adopted

from South China Morning Post early this year.

As you can see, in the cartoon on the right side,

Chinese officials are trying very hard

to maintain the growth rate of 7% or higher.

And then, on the left side, this cartoon says

there are three new think tanks starting up in China.

And then the guy sitting at the desk says we don't need any more think tanks,

we need "know" tanks because they give me some answers.

I hope I can give you answers by the end of this 15-minute presentation

but even if I cannot, please bear with me.

Let me first introduce one book.

This book came out in 2006

from a publisher called Rowman & Littlefield,

and this book grew out of an international conference

that took place in 2004.

In this book, I put together eight internationally renowned experts

to chart China's future from what we had back in 2004.

In that book, we laid out eight possible scenarios for future China.

If you look at the column on the left, these are the three scenarios

that I'd like to take off from the list at this point.

Although we considered these three possibilities back in 2006,

but I think these three scenarios are no longer plausible or applicable

to the future of China

from the vantage point of 2015 which is now.

Yugoslavia doesn't exist anymore, it's completely disintegrated;

you cannot find it on the map.

Now you can refer to Serbia, Bosnia, Herzegovina, and so on.

It's gone.

So I don't think this will be the future for China.

Indonesia, back in 2004, when we were actually doing research for this book,

Indonesia was economically very backward,

politically it was not a democratic system,

and it didn't really have

a very strong diplomatic or strategic presence at all.

So we didn't think China's future will go down the path of Indonesia,

so it's off the list as well.

Latin America: a lot of people compare high Gini coefficient,

that means income inequalities, in China to those of Latin America.

That might be true.

But Latin America's diplomatic strategic presence is not felt.

Differently, China is now rising and is making its imprints everywhere

so I think the Latin America model is also off the list.

If you look at the column in the middle, there are three models.

Indian model, back in 2004, India's economy was not that great.

Of course it's doing a great job now.

But even so, India's presence,

particularly from the viewpoint of Northeast Asia,

is not being felt very strongly.

Of course, there is still a possibility

that China's path might actually resemble that of India in the future.

So there is a possibility for these three models in the middle,

but not really high, I would say.

Soviet Union: as you all know what happened to Soviet Union,

now it's Russia, it's now still a semi-global power,

although its global reach has been constricted considerably.

But there is still a possibility

that China might go down actually the path of the Soviet Union,

but the possibility as I see it is not that high.

Finally, the French model: France is a global power,

but France cannot make international rules and norms by itself.

But France actually makes its imprints

by vetoing what others are willing to do, particularly the United States.

So it's a global veto power.

Will China resemble the path of France?

It remains to be seen.

So these three possibilities in the middle column still remain,

but I'd say the likelihood is not very great.

If you want me to bet, my bet would be on the column on the right,

either the Chinese model or the American model.

What does the Chinese model mean?

It means an authoritarian political system

with a highly competitive market-based economic system.

China has been successful in sustaining this particular model.

If China really should prove successful in the future as well, and I think

that will have enormous implications scholarly, as well as policy-wise.

The American model: that is market-based, highly competitive, efficient system

as well as a politically democratic system.

Will China eventually go down this path?

I don't know, but if you want me to bet, among these eight models,

probably China will go down either the Chinese model

or in the long run, the American model.

We'll see.

I think, down the road, probably the easiest task

that China can accomplish is economic development.

When will China overtake the US in GDP terms?

Already my colleagues from China have talked about it,

but I'd like to lay out a couple of important predictions

made by "think" tanks not know-tanks.

Goldman Sachs provided two estimates.

In 2003, they said that China would surpass

the United States in GDP terms by 2050.

And then six years later, in 2009,

Goldman Sachs revised their figures, to 2027.

And then the Economist, the magazine based in London,

gave out the prediction for 2019.

And Japan's Cabinet Research Office came out with an estimate of 2025.

And China's own Academy of Sciences came out with an estimate of 2019.

So what does this tell us?

I think this seems to suggest that between 2019 and 2025,

China's GDP is very likely to surpass that of the United States.

So I think accomplishing the economic takeover

is probably the easiest and I think it's going to happen very soon.

Maybe, at the latest, within 10 years, the fastest, probably within 5 years.

Particularly given what my colleagues from China and New Zealand

have said about One Belt One Road;

if that should prove successful,

I think it will give an enormous impetus for China's economic development.

Don't forget that America's rise was based in significant part

on the gold rush toward California

because it expanded the spatial as well as the time dimension

for development, by 50 to 100 years.

So if that One Belt One Road initiative should become successful,

then, I think, it would be an enormous variable for China's future.

So economic dimension:

I think there is very little debate on what China will become in 2025.

I think more debatable is China's military power.

Let me introduce two books here.

The one on the left is the Task Force Report

which came out in 2003

by the Council on Foreign Relations in the United States.

And this Task Force Report was chaired by Mr. Harold Brown,

the former Secretary of Defense.

And he put together more than 20 experts, security and military experts in America

and the findings, the conclusion of this Task Force Report

is that as of 2003, the publication date of that report,

as of 2003, China's military power was lagging behind the US by 20 years.

So if we take that conclusion at face value, that means, by 2023,

China's military power will most likely equal that of the US.

Now, let me introduce the book on the right.

This is the book I edited, and it will be forthcoming in two months,

in early October this year by Macmillan.

I put together 13 internationally renowned scholars;

among them three were military experts.

They contributed three chapters to the book.

One on conventional military power, a second on nuclear weapon power,

and a third one on cyber and space power.

They all agreed to one fact

that is, by 2025, China is not going to be a match for the US on a global theater.

So globally, China is not going to be a match for the US.

However, they added a footnote.

That is in the regional setting, particularly East Asia,

China will be a peer competitor.

Particularly given the technological leapfrogging

China has been making in the last 10 years or so,

including the anti-ship ballistic missiles,

supersonic weapons, and so forth;

I think this is real.

So, on the global setting, China is no match even by 2025,

but the conclusion might be quite different in regional settings.

So, economically, China will be number one by 2025,

but militarily China will still be limited to a regional competitor.

Globally, the US will still be the hegemon.

Then I think we have to think

what will be the final game?

The final game will be basically something about perception:

how the US will view China, and how China will view the US.

And most importantly, how the international community

and regional states will view the United States and China.

In other words, which of the two will be considered

as a more benign and friendly power.

I think that with perception, competition will be very important.

Now, given the limited time,

I'll just focus on the perceptions between the US and China.

These are the summary statistics based upon PEW Global Research

between 2008 to2014.

And these are American perceptions and Chinese perceptions of the future,

whether or not China will surpass the United States.

If you look at the third column from the left,

about 10% of both Americans and Chinese think

that China already surpassed the US.

10% of the Americans and Chinese think China already surpassed the United States.

That's not correct, that is not the reality,

but people are already thinking that China already surpassed the US.

If you look at the second column, the percentage of Americans and Chinese

who think China will eventually surpass the US is increasing by the year.

So if you look at 2014, 39% of Americans, nearly 40%,

and nearly 50% of Chinese are thinking

the so called power transition is inevitable.

If you look at the fourth column,

the percentage of Americans and Chinese who think

China will never surpass the US is actually decreasing.

So what does this tell us?

Increasing number of Chinese and Americans are thinking

that power transition is going to happen.

More importantly, the next slide,

these are the summary statistics based upon Gallup polls in the US

between 2001 and 2014.

Which country constitutes the biggest enemy in the eyes of America?

If you look at 2001, China was number two.

But since then, until 2011, China never made top two.

It was always Iran, Iraq, and North Korea.

But after 2010, the year when we all think

China began to make some assertive diplomacy,

American perception of China began to change.

So in 2011, China made it to number two biggest enemy

in the minds of the Americans, and in 2012, China remained number two,

but in 2014, China finally became number one enemy of the US.

Of course, public perceptions change.

Public opinions are very fickle.

However, given the fact that America is a democratic system,

public opinions do matter.

It may have an enormous influence on policy making.

So this is not very good news.

However, probably that is why our colleagues and Kevin Rudd

were talking about constructive realism.

Thus far I've talked only about China.

I haven't talked much about the US.

But I think, in order to talk about the future of China,

we have to talk about the US.

Why? Because it's a game of relativity.

If China grows richer and stronger, but the US stagnates here,

then power transition would definitely take place.