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Andrew Sheng

In 2004, Joshua Cooper Ramo, now co-CEO of Kissinger Associates, coined the term “Beijing Consensus” as an alternative to the Washington Consensus, the neoliberal framework of economic policies devised in the 1980s by the International Monetary Fund, World Bank and US Treasury.
China had just joined the World Trade Organization and, within the country, there was considerable scepticism that a Beijing Consensus existed.
Come 2007, and as the global financial crisis broke out – first with the US subprime and then the European debt crises – the world looked to China, which stepped up with the famous 4 trillion yuan (US$564 billion) stimulus package.
That stimulus unleashed a decade of massive investment in infrastructure, but also an ensuing decade of dealing with a real estate debacle. From 2017, Donald Trump’s first US presidential term signalled a new era of intense geopolitical rivalry.
Since the 1997 Asian financial crisis, the Global South has had growing doubts over the Washington Consensus, which advocated free trade, free flow of capital, rule of law and democracy as the preferred model for development. After the 2007 crisis, even advanced economies raised doubts.
In 2011, Germany launched the Industry 4.0 initiative as part of its High Tech 2020 Strategy. Beijing followed in 2015 with its Made in China 2025 strategy, sparking a global race in industrial policy to match China’s growing prowess.


With mounting signs of protectionism, Chinese discourse on industrial policy shifted towards a dual circulation strategy and high-quality development, including focusing on artificial intelligence (AI), robotics and advanced manufacturing, especially alternative energy, batteries and electric vehicles.
Over four decades, China lifted 800 million people out of poverty and its green and net zero efforts are beginning to pay off; its carbon emissions are levelling off and may even decline.
Meanwhile, Global South countries have struggled since 2007 to find a new development model; they cannot raise enough funding for long-term infrastructure investments, and even less to tackle climate warming. The carbon market, touted as the market solution to pricing carbon emissions, remains largely in Europe and America, with developing countries struggling to access carbon credits.
As “Make America Great Again” tariffs, sanctions and dollar weaponisation grew, the Global South woke up to the reality that China may offer a more realistic and pragmatic development model.
The UN Sustainable Development Goals, launched in 2015 to achieve 17 sustainability, inclusivity and human well-being targets by 2030, seemed the right path in terms of inclusive green growth. But a decade on, only 18 per cent of the 169 SDG targets are on track. As Trump’s tariffs hurt export markets, the Global South has become more receptive to China’s call for a new development paradigm and international order.


At a recent international conference on the global implications of China’s 15th five-year plan in Hong Kong, it became obvious that China’s new development model is entering a different phase.
China is concentrating on being the next electricity-driven economy, augmented by AI and robotics to compensate for its ageing labour force, and moving towards high-quality development, self-reliance amid external threats, and a green-energy-powered industrial base connected to the world through the Belt and Road Initiative.
China remains open to global trade and investment, since the new phase of going out will be driven less by its state-owned enterprises and instead mostly by its private sector.
Mainland experts on the 15th plan are confident China will be able to achieve roughly 4-4.5 per cent gross domestic growth in the period to 2035, given AI is only just spreading throughout the economy and the urbanisation rate is still around 67 per cent, considerably below advanced economies’ levels of about 80 per cent.
China is slowing down, but from a larger economic base. Hence, being able to grow at double the speed of advanced economies means it will become not just a formidable economic giant, but also a growing financial powerhouse.


As advanced countries ramp up their rhetoric on China as a threat, external pressures will unite Chinese domestic opinion around a new Beijing Consensus. Consensus is formed from hard realities and experience. If mature markets are increasingly fencing themselves in with tariffs, China must find alternative paths. Coincidentally, the Global South desperately needs new markets, sources of investment and funding, and to learn from hard experience on developmental challenges.
This is a match made out of mutual necessity, where the Global South, with its young population, large natural resources and ambitions of moving to middle income, finds a fit in a China freshly moving out of middle income into the advanced level.
As China shifts towards higher consumption and domestically driven growth, demand for imports of raw materials and cheap goods from the Global South will grow. As the Global South also needs jobs, China will be shifting its cheap labour manufacturing into new markets, enabling everyone to move up the value chain.
This is less a Beijing Consensus and more a “Global South Consensus” on finding practical ways forward amid a global order being dismantled by the Trump administration.
The Global South wants a voice in forming rules for the new global order, not to be left to the law of the jungle. The UN’s SDGs are not wrong in their aspirations but execution has been poor. Thus, the new consensus is less over ideology and theory, and more about the practicalities of how to survive and thrive in a more complex world.


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As the Global South seeks a better development model and China looks for alternatives to mature markets, a match made out of mutual need is emerging


As the Global South seeks a better development model and China looks for alternatives to mature markets, a match made out of mutual need is emerging.


Global South

Made in China 2025

World Bank Group

International Monetary Fund (IMF)

Global Financial Crisis of 2007-2008

China trade

China's economic recovery

Infrastructure

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Banking & finance

World Trade Organization (WTO)

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Made in China 2025: All stories

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China’s economic stimulus

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Expresses the views, ideas and conclusions of the author. (Eg. Enough of Crazy Rich Asians, think of crazy poor Hongkongers.)


The rise of a Beijing-led ‘Global South Consensus’

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}As the Global South seeks a better development model and China looks for alternatives to mature markets, a match made out of mutual need is emerging

As the Global South seeks a better development model and China looks for alternatives to mature markets, a match made out of mutual need is emerging