US power advantage over China declines in wake of coronavirus pandemic: Lowy Institute
- America still on top of Asia power index, but drops in economic capability and diplomatic influence narrow gap with mainland
- Report sees US and Japan taking until 2024 and 2027, respectively, to recover to 2019 levels of economic activity
While retaining the top spot in the region, the US saw its relative power drop the most of any country in 2020, according to the annual index produced by the Lowy Institute, a Sydney-based think tank.
The US scored 81.6 in the index, a drop of three points from the previous year, with its position declining in all but one of eight measures of power.
The 2020 index, which is in its third year, ranked 26 countries in the region using 128 indicators across eight categories: economic resources and relationships, military capability and defence networks, diplomatic and cultural influence, and resilience and future resources.
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The superpower nonetheless retained the top spot in half of the categories measured: military capability, defence networks, resilience and cultural influence.
“The result is a powerful reminder that legitimacy and leadership on the world stage start with the capacity of leaders to govern well at home,” Lemahieu said in a report on the index’s findings. “It testifies in equal measure to the consequences of a failure in global leadership.”
Lemahieu said the long-term economic fallout of the pandemic would accelerate the country’s decline relative to China over the next decade.
“Uneven economic recoveries will alter the distribution of power between the leading global players well into the next decade,” he said. “Despite setbacks due to the pandemic, China’s economy has bounced back faster than any other major economy. It is forecast to grow in 2020, while advanced economies such as the United States and Japan will take until 2024 and 2027, respectively, to recover to 2019 levels of economic activity.”
The result is a powerful reminder that legitimacy and leadership on the world stage start with the capacity of leaders to govern well at home
“China’s power has stalled and its diplomatic standing diminished,” Lemahieu said. “But in conditions where most countries are less powerful than a year ago, China’s fast economic rebound from Covid-19 will widen the power differentials between itself and the rest of the region.”
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While seen as an overachiever, the East Asian power faces long-term decline, according to the report.
“A recession brought on by the Covid-19 pandemic will be compounded by the structural challenges posed by Japan’s demographic decline adversely impacting productivity,” Lemahieu said. “Japan’s eventual recovery to pre-Covid levels of economic output is on a far distant horizon, in around 2027.”
“On current trends, India will only reach 40 per cent of China’s economic output by the close of the decade – down from the 50 per cent forecast in the 2019 Asia Power Index,” Lemahieu said. “India needs to be understood on its own terms. Its rise as a superpower, if it happens, will be a multi-decade effort and is unlikely to be linear.”
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Among the top 10, Australia was the only country to see its ranking rise, leapfrogging South Korea into sixth place. The middle power country saw its biggest gains in cultural influence, economic relationships and diplomatic influence. South Korea, Singapore, Thailand and Malaysia made up the remainder of the top 10.
Apart from Australia, only Vietnam and Taiwan, ranked 12 and 14, respectively, saw a rise in their scores in 2020.
