Mini Series: The Great Regime Shift From West to East
20th February, 2026
The Decline of Western Trade Dominance
Back in 1948, the U.S. controlled roughly 20% of global trade, while Western economies collectively held 48% (WTO, 2023). Today, U.S. share has dropped to 7.6%, with Western economies at just 22%.
This mirrors the erosion of unipolar dominance as manufacturing and trade shifted eastward.
China’s Historic Rise
China’s global export share grew from 0.5% in 1948 to nearly 15% in 2023, overtaking the U.S. by 2010. East Asia now accounts for 25.6% of global trade, driven by South Korea (2.8%) and Taiwan (1.9%).
Key driver: Deng Xiaoping’s 1978 reforms, which transformed China into a market-oriented, export-led economy.
Through initiatives like the Belt and Road Initiative, China is exporting its model of state capitalism, directly challenging the Western liberal order.
This growth has been historic:
Over 800 million people lifted out of poverty—a feat unmatched in modern history.
Life expectancy rose from 60 to nearly 80 years.
GDP per capita climbed from almost nothing to over $13,000 USD.
But Being a Near-Peer Doesn’t Make You the Leader
For context, U.S. GDP per capita is over $80,000 USD—more than six times China’s. That’s a massive gap to fill.
Demographics are also shifting in China’s favor less positively:
Working-age population is aging rapidly.
Youth unemployment exceeds 20%.
By contrast, the U.S. has a slower-aging population and far better youth employment numbers.
The Changing Growth Model
The cheap-labor manufacturing model that fueled China’s rise is no longer sufficient for this century. The next era will be defined by technology, artificial intelligence, and compute power.
To put it in perspective: by 2030, the U.S. is projected to invest $5–8 trillion in AI infrastructure, dwarfing China’s current annual AI spending of under $100 billion.
China also faces headwinds, including:
Trade restrictions on advanced chips
Rapidly aging workforce
Slower productivity gains in high-tech sectors
The advantage that powered China’s rise—cheap labor and mass manufacturing—will not be enough to propel it to global leadership in this new century.
The Bigger Picture
We are not witnessing the fall of an empire—we’re witnessing its evolution in a multipolar world.
Competition is fierce, stakes are high, and the balance of power is being tested like never before. The U.S. retains advantages in innovation, soft power, and military strength, while China continues to reshape global trade and state-led economic models.
This is not just a race between two nations—it’s a shift into a new, more competitive global regime.