This chapter examines the evolution of China’s outward-looking political-economy model that has defined the purpose of and receptivity to GSCs in recent decades. It first provides significant empirical evidence for the past contribution of Western-linked GSCs -- specially through forward participation -- to China’s economic growth, employment and earnings, expanding middle class, urbanization, and its development of technological capabilities. We then turn to limiting bottlenecks and emerging challenges, identifying three stylized responses among China’s leaders: “GSC preservers,” “GSC reformers,” and “GSC replacers.” The costs and risks of more extreme decoupling from Western GSCs may explain why radical inward-looking options may have been overpowered by their alternatives until recently. However, Covid-19 introduced starker dilemmas into an already charged geopolitical relationship. While the battle over the emerging GSC landscape will continue to be fought primarily within China, the Trump shocks have dealt a heavy political blow to “GSC preservers.” As the effects of Covid-19 are overlaid on geopolitical tensions, the odds that mutually beneficial outcomes -- including the survival of GSCs as we knew them -- can still reemerge out of the current conundrum, remain unclear.

As all chapters were being readied for submission, Covid-19 erupted furiously in early 2020, compelling the effort to incorporate the pandemic’s initial effects on GSCs, the trade and technology war, and international relations within East Asia, in real time. Chapter 13 is, therefore, a postscript distilling findings from Parts I and II prior to Covid-19 while addressing the latter’s early effects on the chapters’ respective arguments. It then analyzes the strategies GSCs have embarked on in response to both geopolitical and pandemic shocks, building largely on preliminary 2020 survey data. Covid-19 accelerated the cumulative impact of geopolitical shocks and rising inward-oriented hyper-nationalist models, making GSCs more vulnerable than at any time since their initial expansion in the 1990s. Their ongoing restructuring and efforts to reduce overreliance on China suggest a potential decline in China’s status as factory of the world relative to the past, but hardly its demise. Migration out of China and reshoring remain more the anomaly than the norm for now. There is still uncertainty, however, as to whether geopolitics, technological competition, and the legacy of Covid-19 could unleash even more sizable disruptions in the global geography of production.

Chapter 1 introduces the broader framework for the volume and its place in the broader literature on the relationship between economic interdependence and international cooperation and conflict. It draws attention to the deeper political origins of GSCs in the grand strategies of outward-oriented political survival models and identifies some of the pivotal questions regarding the broader role of GSCs in the international relations of East Asia. A focus on GSCs is especially pertinent to our world time as East Asia faces the most complex bundle of geopolitical and geo-economic threats in decades. This provides a natural experiment of sorts for gauging the extent to which GSCs may provide a more resilient foundation for interstate cooperation than older forms of interdependence have at various historical junctures or, alternatively, whether they amount to equally vulnerable targets of nationalistic and autarkic ambitions, inward-looking turns in the US and China, the trade and technology war, and other geopolitical shocks from within the region. Finally, the chapter introduces the rest of the volume, with different chapters addressing various dimensions of the relationship between GSCs and changing features of East Asian and Asia-Pacific international relations.