Soft Power
The world's nations are often divided among the developed/developing, first/third world categories. If I were to grossly simplify things, it'd look like this:
First Tier Nations
* Has gone through industrial revolution/economic development
* Was at one time manufacturing powerhouse
* Leans toward service industry today
* Relatively wealthy & stable economy
* Relatively clean environment (polluting industries moved to 2nd tier)
* Provides economic/military aid and loans to Second-Tier countries
* Low savings rate, open access to credit
* High spending rate on credit - both citizens and government, resulting in high debts
* Defining moments in history: Protestant Reformation & acceptance of usury, industrial revolution
Second Tier Nations
* Going through industrial revolution/economic development
* Economy leans heavily toward manufacturing industry
* Dirty environment & pollution problems associated with manufacturing
* Depenent on trade with First-Tier nations
* Provides econoic/military aid and loans to Third-Tier countries
* Fast-growing economy, but not wealthy because the starting point is very low
* High savings rate from citizens, limited access to credit
* Defining moments in history: Decline of communism/centralized economic planning, rise of capitalism & world trade
Third Tier Nations
* Provider of raw natural resources to Second-Tier Nation's manufacturing
* Dependent on trade with Second-Tier nations
* High poverty rate with government corruption
* Citiens have little or no access to credit
* Government borrows heavily from richer nations, putting itself in perpetual debt
* Defining moments in history: era of colonization, when powerful nations defined borders and created 3rd-tier nation-states
There are some exceptions, i.e. small and rich oil-producing countries that are "petro welfare states".
I read yahoo news today and this article by R. Kiyosaki made an interesting observation:
One of the ways rich countries like the United States gain an economic advantage over weaker countries is by lending them money on the condition that the weaker country buy the rich country's products. Hot money, as it is sometimes called, enters the poorer economy and the economy booms, but then it later collapses when the country can't repay its debt.
On a more personal scale, many individuals fall prey to the lure of easy credit with credit cards, school loans, and mortgage debt. Once the lenders have you hooked on debt, they're assured of a steady stream of income for years, hoping you never pay it off. And if you default, they may force you into liquidating your assets.
As a "First Tier" country, the US can influence others with "hot money", that is, economic/military aid and loans. The recipent country becomes dependent on the first-tier nation's loans on credit, and the first-tier nation gains influence over the debt nation.
China today is a large 2nd tier country. It cannot compete easily against first tier countries like US/Japan/EU in gaining influence over other 2nd tier countries. BUT it can win against other 2nd tier countries in winning over influence on 3rd tier countries. A good example is the PRC-ROC diplomatic war, where ROC cannot compete against PRC's size. But the target, or "debt" countries tend to be small, weak, and poor 3rd-tier ones like Nigeria.
Can China be a regional power today? In economic "soft power" sense, yes, but only with 3rd tier nations, and some smaller 2nd tier ones. We've already seen the growing Chinese investments in Africa, and I believe they have the potential to do the same in SE Asia (Laos, Cambodia, Vietnam, etc.). But for other 2nd-tier countries that are firmly in first-tier country's sphere of influence, it'd be very difficult, unless if the first-tier countries over-extend itself and suffers a bubble burst/collapse and present an opportunity for China to step in.