BEIJING -- Over the past decade and more, China has capitalized on critical transformations in the global landscape to forge new patterns of political and economic influence and significantly further its national interests. But in so doing, it has also become exposed to a growing matrix of risks to its capacity for continued international expansion. While this exposure has rendered China more vulnerable to external actors and threats, the greatest obstacles facing the country's future trajectory ultimately come from structural deficiencies in the domestic political economy.
In the international arena, although China's most recent gains have been impressive, much of that is due to the relative current economic ill-health of the U.S. and EU rather than the absolute attraction of Chinese investment. In fact, repeated attempts by Chinese majors to secure an "A-list" investment have been frustrated, such as Chinalco's failed $20 billion bid for a 9 percent stake in mining giant Rio Tinto. Instead, Chinese industrial flagships have had to be content with mopping up failing foreign outfits such as Volvo.
More generally, whether China will be able to maintain long-term relationships with foreign partners and develop genuine "soft power" is a cause for concern. Chinese diplomacy is founded on investment and technical assistance in infrastructure projects, but concern exists over the environmental and safety records of Chinese firms, along with a tendency to overstate their engineering capabilities.