V. The Emergence of China and Russia as New Great Powers





Note of the Editorial Board: The following Chapter contains several figures. For technical reasons these can only be viewed in the pdf version of the book which can be downloaded here.





This historic decline of the old capitalist powers and the resulting massive economic shift led to the creation of new imperialist powers (China and Russia) and, inextricably associated, to the acceleration of the rivalry between the Great Powers.




Production and Trade




As we have demonstrated in a number of studies, China has become the most important challenger of the U.S. as the hegemonic imperialist power. [1] When we look at the basis of capitalist value production – global industrial production – we see that the US’s share decreased from 25.1% (2000) to 17.7% (2015), Western Europe’s share also declined from 12.1% to 9.2%, while China’s share grew from 6.5% (2000) to 23.6% (2015). (See Figure 15) Likewise, while the U.S.’s share in world trade declined from 15.1% (2001) to 11.4% (2016), China’s share rose in this period from 4.0% to 11.5%. (See Figure 16)




Figure 15. Global Industrial Production, US, Western Europe and China 1970-2015 (in Current Prices) [2]



Figure 16. Share of the US and China in World Trade, 2001-2016 [3]




According to the latest statistics published by the World Trade Organization, China’s share in merchandise trade in 2017 was 11.5% while the US was 11.1%. [4]


In Table 5 and 6 we show figures which demonstrate the long-term development of world merchandise exports and imports since the end of World War II. They reflect, among others, the decline of the old imperialist powers and the rise of China – particularly since the beginning of the century. Since the restoration of capitalism in the former Stalinist states (the figures provided are for 1993), the share of the U.S. in world merchandise exports declined from 12.6% to 9.0% in 2017. There has been the same tendency in other Western countries (Japan: from 9.8% to 4.1%, Germany: from 10.3% to 8.4%, France: from 6.0% to 3.1%, UK: from 4.9% to 2.6%). In the same period China’s share rose from 2.5% to 13.2% and Russia’s from 1.7% to 3.0%. The same development has taken place in world merchandise imports.




Table 5. Share of World Merchandise Exports by Region and Selected Economy, 1953-2017 (Percentage) [5]


Country                                                 1953       1963       1973       1983       1993       2003       2017


USA                                                       14.6        14.3        12.2        11.2        12.6        9.8          9.0


Germany                                              5.3          9.3          11.7        9.2          10.3        10.2        8.4


France                                                   4.8          5.2          6.3          5.2          6.0          5.3          3.1


United Kingdom                               9.0          7.8          5.1          5.0          4.9          4.1          2.6


China                                                    1.2          1.3          1.0          1.2          2.5          5.9          13.2


Japan                                                     1.5          3.5          6.4          8.0          9.8          6.4          4.1


India                                                      1.3          1.0          0.5          0.5          0.6          0.8          1.7


CIS (Russia & ex-USSR)                  -               -               -               -               1.7          2.6          3.0


South Africa                                        1.6          1.5          1.0          1.0          0.7          0.5          0.5




Table 6. Share of World Merchandise Imports by Region and Selected Economy, 1953-2017 (Percentage) [6]


Country                                                 1953       1963       1973       1983       1993       2003       2017


USA                                                       13.9        11.4        12.4        14.3        15.9        16.9        13.7


Germany                                              4.5          8.0          9.2          8.1          9.0          7.9          6.6


United Kingdom                               11.0        8.5          6.5          5.3          5.5          5.2          3.7


France                                                   4.9          5.3          6.4          5.6          5.7          5.2          3.6


China                                                    1.6          0.9          0.9          1.1          2.7          5.4          10.5


Japan                                                     2.8          4.1          6.5          6.7          6.4          5.0          3.8


India                                                      1.4          1.5          0.5          0.7          0.6          0.9          2.5


CIS (Russia & ex-USSR)                  -               -               -               -               1.5          1.7          2.3


South Africa                                        1.5          1.1          0.9          0.8          0.5          0.5          0.6






Monopolies and Billionaires




Such a decline of the old Western imperialist powers and the emergence of China as a new challenger can be observed not only within the scope of capitalist value production and trade. We see the same development when we analyze the national composition of the leading capitalist monopolies. Comparing the Forbes Global 2000 list – a list the world’s 2000 largest corporations – of the year 2003 with the year 2017, we see that while the US remains the strongest power, its share has declined substantially from 776 corporations (38.8%) to 565 (28.2%). At the same time, China’s share grew dramatically and it has now become the number two among the Great Powers. (See Table 7)




Table 7. National Composition of the World’s 2000 Largest Corporations, 2003 and 2017 (Forbes Global 2000 List) [7]


2003                                                                       2017


Number                 Share                                     Number                 Share


USA                                                       776                         38.8%                                    565                         28.2%


China                                                    13                           0.6%                                       263                         13.1%


Japan                                                     331                         16.5%                                    229                         11.4%


United Kingdom                               132                         6.6%                                       91                           4.5%


France                                                   67                           3.3%                                       59                           2.9%


Canada                                                 50                           2.5%                                       58                           2.9%


Germany                                              64                           3.2%                                       51                           2.5%




We see the same picture when we compare the regional composition of the world’s Top 5000 companies (by market capitalization) for the years 2000 and 2016. (See Table 8) Given the larger number of monopolies, this statistic is even more representative for the dramatic change which has taken place in the relation of forces between the imperialist rivals. In this table China’s rise as an imperialist power is confirmed again. In 2000, it’s share among this list of leading corporations was 402 (8%). In 2016, this share has already grown to 1,085 (21.7%). At the same time did North America’s share decline from 1,958 (39.2%) to 1519 (30.4), Europe’s share from 1346 (26.9%) to 876 (17.5%) and Japan’s share from 659 (13.2%) to 437 (8.7%).




Table 8. Regional Composition of World’s Top 5000 Companies 2000 and 2016 [8]


                                North America                    Europe                   Japan                     China                     Others


2000                       1956                                       1346                       659                         402                         635


2016                       1519                                       876                         437                         1085                       1083






Another study, published by UNCTAD, also confirms China’s rise amongst the biggest global monopolies. It reports that China’s share among the largest 2,000 Transnational Corporations (TNC) has grown so massively in the past two decades so that by 2015 they took 17% of all profits of these top monopolies. The UNCTAD report adds: “Interestingly however, the share of Chinese financial TNCs in top TNCs profit expanded rapidly to more than 10 per cent to total top TNCs profits, exceeding those of United States financial top TNCs in 2015.[9]


These figures prove beyond doubt that China’s rise (and the West’s decline) is not limited to production and trade. As we will see later, various revisionist deniers of China’s imperialist character claim that the Middle Kingdom would still be the global workbench. But as we have argued in various works and as the figures above confirm, this is no longer true – at least not since one decade! China does not only produce and trade a significant share of the global capitalist value product but it also owns a large share of it. This is reflected in the substantial share of Chinese corporations among the world’s top monopolies as well as their profits (both in the industrial and the financial sector). In other words, the Chinese corporations (even if they are formally state-owned) are not a kind of “socialist” mega-enterprises but undoubtedly capitalist monopolies.


Another example, telling a lot about China’s “socialism”, is the rise of the billionaires. As we have shown in other studies, China has become home to the largest number of billionaires, or the second largest – depending on which list one takes – in the world. According to the 2017 issue of the Hurun Global Rich List, 609 billionaires are Chinese and 552 are US citizens. Together they account for half of the billionaires worldwide. [10] The Forbes Billionaire List, which is US-based while Hurun is China-based, sees the U.S. still ahead. According to Forbes: “The U.S. continues to have more billionaires than any other nation, with a record 565, up from 540 a year ago. China is catching up with 319. (Hong Kong has another 67, and Macau 1.) Germany has the third most with 114 and India, with 101, the first time it has had more than 100, is fourth.“ [11] While the detailed figures vary in the different reports, the trend in all available studies is the same: the weight of China’s monopoly capitalists is increasing.


A very similar result emerges from the latest edition of the annual Billionaires Insights report published in October 2018 by the Swiss Bank UBS, jointly with Britain’s PwC. [12] According to this report there are 2,158 billionaires in the world, of these have 373 their home in China. This figure rises to 475 if we add the billionaires living in Hong Kong, Macao (both of them are part of the Chinese state) as well as Taiwan. This means that about one fifth of the global super-rich – i.e. the monopoly capitalists – are living in China! This figure is not much below the number of billionaires living in the U.S. (585) and above the figures for Japan as well as the combined figure for all imperialist powers in Western Europe (414). Furthermore, of all countries it was the Chinese billionaires which experienced the fastest growth of their wealth in 2017 (+39%). Billionaires in other countries had much lower growth rates (the global average growth was 12%). China is also the country with the highest number of new billionaires. 106 people became billionaires in 2017 (although a number dropped off the list from 2016). That comes out to roughly one new billionaire every three days. [13]


It is evident, that the Chinese capitalist class experienced the fastest growth in the world in the past decade. The UBS/PwC report comments: “Twelve years ago, the world’s most populous country was home to only 16 billionaires. Today, as the ‘Chinese Century’ progresses, they number 373, nearly one in five of the global total.


It is important to recognize that China’s capitalism is based not only on a tiny minority of super-rich (in contrast to countries like India or Saudi Arabia) but rather on a broader stratum of small and middle capitalists. As we show in Table 9, China is number two in all categories of millionaires – only behind the U.S. and ahead of all other imperialist Great Powers like Japan, Germany, France and Britain.




Table 9. The Rich and the Super-Rich by Country, 2018 [14]


Country                                                                                Wealth Range (in Million US-Dollar)


                                                1-5m                      5–10m                   10–50m                                50–100m              100–500m            500+m


United States                      14,520,885           1,855,679              902,736                 50,144                   19,253                   1,144


China                                    3,094,768              235,858                 132,701                 10,113                   5,690                      708


Japan                                    2,627,845              125,377                 51,947                   2,478                      1,027                      71


United Kingdom               2,247,529              124,244                 56,535                   3,125                      1,422                      117


Germany                             1,985,627              127,157                 63,678                   4,078                      2,042                      203


France                                   2,002,967              99,252                   42,117                   2,087                      886                         64




Another indicator to measure China’s rise is, what Chinese economists call net social wealth. This is the total of non-financial assets and net foreign assets. A recently published report, which was released by the China-based National Institution for Finance & Development, calculates that China's net social wealth reached 437 trillion yuan ($63.66 trillion) at the end of 2016, equal to about 70% of the US total and ahead of all other Great Powers. [15]




Capital Export and Military Spending




The next two tables demonstrate that China and Russia (to a lesser degree) are increasingly becoming major foreign investors. In Table 10 we reproduce the latest figure for the capital export of the Great Powers. As we can see China had already become number three in Foreign Direct Investment Outflows in 2017 – ahead of all European powers. Russia’s figure is lower, slightly less than half of Germany’s FDI.




Table 10. Foreign Direct Investment Outflows by Country in 2017 (in Millions of $US and as Share of Global FDI Outflows) [16]




Country                                                2017                                       Share of the Global FDI Outflows


Total                                                       1,429,972                              100%


USA                                                       342,269                                 23.9%


Japan                                                      160,449                                 11.2%


Britain                                                   99,614                                   7%


Germany                                                82,336                                   5.6%


France                                                    58,116                                   4.1%


China                                                     124,630                                 8.7%


Russia                                                    36,032                                   2.5%




When we look at the accumulated stock of FDI’s outflows (by 2017) it is interesting to see the rapid catch-up process particularly of China. Despite the fact that China only became an imperialist power about a decade ago, its FDI Outward stock already equals the figures of all other Great Powers (except the U.S. (see Table 11).




Table 11. Foreign Direct Investment Outward Stock by Country in 2017 (in Millions of $US and as Share of Global FDI Outward Stock) [17]




Country                                                2017                                                       Share of the Global FDI Outflows


Total                                                       30,837,927                                           100%


USA                                                       7,799,045                                              25.3%


Japan                                                      1,519,983                                              4.9%


Britain                                                   1,531,683                                              5%


Germany                                                1,607,380                                              5.2%


France                                                    1,451,663                                              4.7%


China                                                     1,482,020                                              4.8%


Russia                                                    382,278                                                 1.2%




We can observe a similar development in the field of investment in modern technologies. As Figure 17 shows, the U.S. remains the world’s leading country in terms of spending for Research & Development. However, China is catching up rapidly. Beijing’s current five year plan calls for increasing research and design spending to 2.5% of GDP, up from 2.1% in 2011-2015. As a result, it has become the second-placed country in the past decade.




Figure 17. Top Ten Countries by Spending for Research & Development, 2000-2015 [18]




While Russia is weaker on an economic level, it still plays an important role given its military and political weight. In addition to important monopolies like Gazprom or Rosneft, Russia has a huge military-industrial complex making it the second largest military power behind the U.S. and ahead of all other imperialist states. (See Table 12 and 13) [19]




Table 12. World Nuclear Forces, 2018 [20]


Country                                Deployed Warheads          Other Warheads                Total Inventory


USA                                       1,750                                      4,700                                      6,450


Russia                                   1,600                                      5,250                                      6,850


France                                   280                                         20                                           300


China                                                                                 280                                         280


UK                                          120                                         95                                           215




Table 13. The World’s 10 Top Exporters of Weapons, 2016 [21]


Exporter                               Global Share (%)


1 USA                                    33


2 Russia                               23


3 China                                 6.2


4 France                                6.0


5 Germany                          5.6


6 UK                                      4.6


7 Spain                                 2.8


8 Italy                                    2.7


9 Ukraine                             2.6


10 Israel                                2.3




Furthermore, it is essential to point out that the Russian state has only a relatively small amount of foreign debt. [22] At the same time, the Russia’s corporate debt is much higher and its total external debt at current point is around 30% of GDP. However, accelerating rivalry between imperialists states is pushing Russian corporation to sell its debt, which resulted in record payment of around 130 billion US Dollars in 2018. [23] Such high currency debt is connected with Russia’s orientation to export commodities in order to gain foreign currency. Nevertheless, high debt payments do not automatically mean that Russia would be a "semi-colonial" state. There was a similar pattern in Tsarist Russia when French and German banks played a major role in the economy. Nevertheless, its military apparatus and its colonial expansion, combined with increasing foreign investments in Asian nations, gave Russia its imperialist character.


Today, modern Russia’s imperialist ambitions are more far-reaching than those of the old Empire. For example, Russia is becoming a dominating force in Latin America states like Venezuela [24] and Cuba [25]. It is also expanding its presence in the Middle East in Syria, Libya, Iran and Egypt. In Africa Russia already deploys more UN "peacekeeping" troops than other nations. [26] There is also some presence of Russian financial capital in Nigeria. [27] The Russian government uses different means to achieve its foreign political goals: military aid, loans, foreign investments, etc.


Understanding the imperialist character of Russia requires viewing the state not only from an economic but from a political-economic point of view. Usually economistic-minded pseudo-Marxists tend to have a linear interpretation of the relationship between basis and superstructure and view politics as always directly following the economy. Engels repeatedly emphasized the "relative independence of the super-structure" and that the economy is the decisive determinant only in "final analysis". [28] Thus, political actions of the bourgeoisie sometimes can take place prior to changes and achievements in economy. In fact, this is the case with Russia. If we look at the political actions of Russian state and later its foreign policy in the Middle East, we can observe how its successful intervention in Syria created a very prestigious position for Russian monopolies in the region. For instance, Rosatom achieved a number of deals with Egypt and Turkey, the military-industrial complex acquired new contracts with several states and some forms of new partnerships with traditional US-allies like Saudi Arabia and Israel are on the horizon.


[1] On the RCIT’s analysis of China as an emerging imperialist power see the literature mentioned in the special sub-section on our website: https://www.thecommunists.net/theory/china-russia-as-imperialist-powers/. In particular we refer readers to Michael Pröbsting: The China-India Conflict: Its Causes and Consequences. What are the background and the nature of the tensions between China and India in the Sikkim border region? What should be the tactical conclusions for Socialists and Activists of the Liberation Movements? 18 August 2017, Revolutionary Communism No. 71, https://www.thecommunists.net/theory/china-india-rivalry/; Michael Pröbsting: The China Question and the Marxist Theory of Imperialism, December 2014, https://www.thecommunists.net/theory/reply-to-csr-pco-on-china/; Michael Pröbsting: China‘s transformation into an imperialist power. A study of the economic, political and military aspects of China as a Great Power, in: Revolutionary Communism No. 4, http://www.thecommunists.net/publications/revcom-number-4.

[2] Hong Kong Trade Development Council: Changing Global Production Landscape and Asia’s Flourishing Supply Chain, 3 October 2017, p.1

[3] Hong Kong Trade Development Council: Changing Global Production Landscape and Asia’s Flourishing Supply Chain, 3 October 2017, p.4

[4] WTO: World Trade Statistical Review 2018, p. 23

[5] WTO: World Trade Statistical Review 2018, p. 122. We would also like to draw attention to the fact that the U.S. and Britain import substantially more commodities than they export, i.e. the live above their means. They are definitely the most rotten, parasitic old imperialist powers. No wonder that the U.S. has become the world’s biggest debtor.

[6] WTO: World Trade Statistical Review 2018, p. 123

[8] Tomohiro Omura: The Maturity of Emerging Economies and New Developments in the Global Economy, Mitsui Global Strategic Studies Institute Monthly Report, April 2017, p. 4

[9] UNCTAD: Trade and Development Report 2018, New York and Geneva, 2018, p. 58

[10] Hurun Global Rich List 2017, http://www.hurun.net/EN/HuList/Index?num=8407ACFCBC85; see also Zhu Wenqian: Beijing listed as billionaire capital of world once again, China Daily, 2017-03-08, http://www.chinadaily.com.cn/business/2017-03/08/content_28470987.htm; Michael Pröbsting: China’s “Socialist“ Billionaires, 16.11.2015, http://www.thecommunists.net/worldwide/asia/china-s-billionaires

[12] UBS/PwC: New visionaries and the Chinese Century. Billionaires insights 2018; A media release of the publishers which summarizes the results, can be viewed here: UBS/PwC Billionaires Report 2018: Total billionaire wealth grows 19 percent to a record USD 8.9 trillion, 26 October 2018, https://www.ubs.com/global/en/ubs-news/r-news-display-ndp/en-20181026-billionaires-report-2018.html

[13] See also our article on this report: Michael Pröbsting China: A Paradise for Billionaires. The latest UBS/PwC Report about the Global Super-Rich Delivers another Crushing Blow to the Stalinist Myth of China’s “Socialism”, 27.10.2018, https://www.thecommunists.net/worldwide/asia/china-is-a-paradise-for-billionaires/; see also Michael Pröbsting: The Global Super-Rich Get Even Richer. UBS/PwC Publish their latest Report about the World’s Billionaires, 27.10.2018, https://www.thecommunists.net/worldwide/global/the-global-super-rich-get-even-richer/

[14] Credit Suisse Research Institute: Global Wealth Databook 2018, October 2018, p. 125

[15] Xie Jun: China’s social net wealth second highest, while imbalances need attention, Global Times, 2018/12/27 http://www.globaltimes.cn/content/1133892.shtml

[16] UNCTAD: World Investment Report 2018, pp. 184-187

[17] UNCTAD: World Investment Report 2018, pp. 188-191

[18] Pentagon: Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States, Report to President Donald J. Trump by the Interagency Task Force in Fulfillment of Executive Order 13806, September 2018, p. 39

[19] On the RCIT’s analysis of Russia as an imperialist power see the literature mentioned in the special sub-section on our website: https://www.thecommunists.net/theory/china-russia-as-imperialist-powers/. In particular we refer readers to Michael Pröbsting: Lenin’s Theory of Imperialism and the Rise of Russia as a Great Power. On the Understanding and Misunderstanding of Today’s Inter-Imperialist Rivalry in the Light of Lenin’s Theory of Imperialism, August 2014, http://www.thecommunists.net/theory/imperialism-theory-and-russia/; Michael Pröbsting: Russia as a Great Imperialist Power. The formation of Russian Monopoly Capital and its Empire – A Reply to our Critics, 18 March 2014, Special Issue of Revolutionary Communism No. 21 (March 2014), https://www.thecommunists.net/theory/imperialist-russia/.

[20] SIPRI Yearbook 2018, Armaments, Disarmament and International Security, p. 236

[21] SIPRI Yearbook 2017 (Summary), p. 15

[22] See e.g. Russia Total External Debt, https://tradingeconomics.com/russia/external-debt

[23] See e.g. ING: Russia intensifies net foreign debt redemption in 3Q, 11.10.2018, https://think.ing.com/snaps/russia-intensifies-foreign-debt-redemption-in-3q/

[24] See e.g. Anthony Faiola and Karen DeYoung: In Venezuela, Russia pockets key energy assets in exchange for cash bailouts, Washington Post, December 24, 2018, https://www.washingtonpost.com/world/national-security/in-venezuela-russia-pockets-key-energy-assets-in-exchange-for-cash-bailouts/2018/12/20/da458db6-f403-11e8-80d0-f7e1948d55f4_story.html?noredirect=on&utm_term=.4c57edeb1009

[25] See e.g. Russia to develop production facilities in Cuba, 21 Jun, 2016, Russia Today, https://www.rt.com/business/347586-russia-cuba-facilities-development/

[26] See e.g. South China Morning Post: How Russia is boosting its role in Africa with weapons, investment and ‘instructors’, 14 August, 2018, https://www.scmp.com/news/world/africa/article/2159622/how-russia-boosting-its-role-africa-weapons-investment-and

[27] See e.g. Financial Times: Fortunes of Nigeria’s banks tied to the oil price, 20.11.2018, https://www.ft.com/content/370057c8-c71f-11e8-86e6-19f5b7134d1c

[28] See e.g.: „According to the materialistic conception of history, the production and reproduction of real life constitutes in the last instance the determining factor of history. Neither Marx nor I ever maintained more. Now when someone comes along and distorts this to mean that the economic factor is the sole determining factor, he is converting the former proposition into a meaningless, abstract and absurd phrase. The economic situation is the basis but the various factors of the superstructure – the political forms of the class struggles and its results – constitutions, etc., established by victorious classes after hard-won battles – legal forms, and even the reflexes of all these real struggles in the brain of the participants, political, jural, philosophical theories, religious conceptions and their further development into systematic dogmas – all these exercize an influence upon the course of historical struggles, and in many cases determine for the most part their form. There is a reciprocity between all these factors in which, finally, through the endless array of contingencies (i.e., of things and events whose inner connection with one another is so remote, or so incapable of proof, that we may neglect it, regarding it as nonexistent) the economic movement asserts itself as necessary. Were this not the case, the application of the history to any given historical period would be easier than the solution of a simple equation of the first degree. We ourselves make our own history, but, first of all, under very definite presuppositions and conditions. Among these are the economic, which are finally decisive. But there are also the political, etc.“ (Friedrich Engels: Letter to Joseph Bloch (1890); in: MECW 49, pp. 34-35)