China's Grand Strategy and Money Muscle: The Potentialities and Pratfalls of China's Sovereign Wealth Fund and Renminbi Policies

China’s grand strategy consists of the mix of internal and external political, military, economic, technological, and socio-cultural strategies that it uses to advance its security interests, given its resources and the international context.1 Despite the richness of the term, specialists concentrating on Chinese security interests have hijacked and narrowly conceptualized it in terms of China’s military modernization, increasingly ambitious defence strategies, and efforts to warm relations with diverse countries such as Russia.2 This myopia is ill-advised, as China has long made use of and is using economic instruments to advance its security interests (properly understood).3 Moreover, Chinese strategic thinkers are clearly reflecting on the geopolitical implications (political, economic, and prestige) of their country’s economic rise and the commensurate relative economic decline of the United States.4 Finally, China has impressive intrinsic economic capabilities; e.g. it is the world’s second largest economy, largest exporter, and a major creditor nation.5