Does China's rise signal a new economic superpower, or an old one?
By James Melik
Business reporter, BBC World Service
Some people say economic power is shifting towards the East, but is that a new development?
Goldman Sachs believes that the four largest economies in the world will be China, India, the US and Japan by 2015.
That three of the four largest economies in the world might be Asian suggests that the old world order is re-establishing itself, according to Dr Kishore Mahbuani at the Lee Kuan Yew School of Public Policy at the National University of Singapore.
"From the year one to the year 1820, the two largest economies of the world were consistently China and India," he says.
"In the 19th and 20th Century, first Europe took off and then North America," he says. "But the last 200 years were historical aberrations."
Just as Genghis Khan once established an empire that covered more than one fifth of the Earth's surface, stretching from Japan to Eastern Europe, many people feel that China and India are creating Asian world powers once again.
Dr Mahbuani maintains that Asian countries are becoming more confident about their future and that the "Asian Century" is coming.
"This crisis has had an enormous impact on Asian minds," he says. "The West was telling us they knew how to run the world, telling us how to create the best economies in the world. How can you believe that any more?"
The US model of capitalism has delivered substantial benefits, however, not least in Asian economies. When China and South Korea copied Western ways of thinking and marketing, their economies took off.
Dr Mahbuani believes that one of the fundamental things Asians have learnt from the West, is the virtues of free market economics.
"It is a question of pragmatism," he says. "Asian states are rising because they have finally understood, absorbed, and implemented the best practices."
There has been a fundamental shift, with the G8 group of leading industrialised nations becoming the G20 earlier this year as India and China join the ranks of the economic elite.
The new world order includes companies such as Embraer, the Brazilian aircraft maker, and Tata, the Indian conglomerate into everything from steel to hotels to finance.
Genghis Khan's Mongol empire was twice as large as Rome's
"There is a vibrancy to companies in these new economies," says Arindam Bhattacharya of the Boston Consulting Group.
He asserts that these companies are from large countries which are essentially poor and, because they are poor, they have an extremely competitive DNA which is different from the Western markets.
Mr Bhattacharya believes companies in the emerging countries are more open to partners, open to acquisitions, and open to learn very quickly. "One of the defensive strategies of Western companies is to buy up these competitors," he observes.
Furthermore, he thinks Asian companies can change the game rather than mimic their Western counterparts.
"Tata came out with the Nano," Mr Bhattacharya says. "Every automotive company in the world said that would not be possible but they did it."
Likewise, Embraer came up with their innovative double-bubble jet which led them to become leader in the region.
"Companies are innovating with ingenuity," he says. "They do not have a patent pipeline, nor [do they] invest billions of dollars into research and development. But they are very ingenious in bringing new products into the market."
The counter-view is that Asian countries like South Korea, and China in particular, have become prosperous by manufacturing cheaply and exporting the fruit of their labours to the US and Europe.
But now that Westerners are not consuming voraciously those Asian manufacturers no longer have a market for their goods.
There is also a view that the Asian economies may not emerge that well out of this recession because many of them have built themselves as exporters and not consumers.
"Asian countries have to try and find ways to crank up domestic consumption," says Ajay Chibber, assistant secretary-general of the United Nations.
"Governments have to spend more on government consumption, government infrastructure, and government social spending in the short term."
Having just announced a large health insurance package, he believes China is moving in that direction.
"One of the reasons why Asians do not consume so much is because they do not have institutionalised social protection systems," Mr Chibber says.
"If Asian countries can use this crisis to put in place the kind of social systems that people take for granted in the West, then people will start consuming more."
He believes that if Asian leaders take the right decisions in the way they rebalance their economic structure, then Asia will become as it was 400 or 500 years ago - the centre of world power.
When the US comes out of this crisis it is not going to be consuming to the same level that it was in the last four or five years.
Any rebalancing therefore, must take place in Asia and, if they get it right, history will repeat itself and a new wave of Asian empires will become a reality.
"In the previous crisis Asia needed to look to the West for solutions. In this crisis Asia needs to find its own solutions," Mr Chibber says.