Why The 2025 Power Map Hides More Than It Reveals
Lowy Institute's annual ranking: exercise in nostalgia
The annual Lowy Power Index is less a confession than an annual preachment from Australia’s political clergy to a converted congregation. The priest mounts the pulpit, opens the sacred text (the weighted categories below1), and intones to all that the American emperor remains magnificently robed. Meanwhile the congregation, glancing sideways, sees the Imperial hem fraying and its fabric thinning in the light from the east. Every year since 2018, Lowy has moved the goalposts and re-weighted the categories to make Washington’s number go up, but this week its efforts to boost America’s standing became ridiculous. Here are the category rankings with my comments
Economic Capability
China 86.0, USA 87.8. China’s economy, adjusted for purchasing power, is fifty to one-hundred and fifty percent larger than America’s–and growing three times faster.
Military Capability
China 70.6, USA 88.9. The US trails China by a vast margin in technology, men, materiel, manufacturing, morale and money.
Resilience
China 70.0, USA 84.3. China, after 4000 years, is the unchallenged master of resilience. The USA has yet to endure its first national catastrophe.
Future Resources
China 73.9, USA 77.3 . China’s human resources are many times America’s.
Economic Relationships
China 95.6, USA 56.8. True enough.
Defence Networks
China 18.9, USA 81.4. China and its allies control 70% of global warship construction and its ships patrol the Pacific, Atlantic, Polar and Black Seas.
Diplomatic Influence
China 97.7, USA 82.7 The gap has widened almost every day since Lowy conducted
its survey.
Cultural Influence
China 58.7, USA 84.2 Hollywood and Taylor Swift still count for something, apparently, but social media and millions of visa-free young visitors make a longer-lasting, deeper impact.
A difficult truth
By every metric that decides who shapes the twenty-first century, China has either overtaken the United States or is breathing down its neck. The only categories Washington still dominates are the ones that measure yesterday’s world: raw military expenditure and the number of countries willing to host American bases. In the categories that measure tomorrow, economic relationships, diplomatic reach, future resources, China is already the pacesetter. Lowy’s trick, of course, is to give those yesterday categories wildly disproportionate weight.
Defence Networks alone is worth almost as much as Economic Relationships and Diplomatic Influence combined. They have turned the index into a nostalgia exercise: how much longer can the United States bribe, bully, or guilt-trip the rest of the planet into pretending it is still 1995?The mask slipped most spectacularly in Economic Relationships. China scored 95.6 because literally no country on Earth can now afford to decouple from its factories, ports, and wallets. The United States scored 56.8 because half the planet has spent the last decade looking for workarounds to the dollar, to American sanctions, to American lectures.
When your closest allies (Japan, South Korea, Australia itself) quietly shift more trade to China every year, your “relationships” score is a polite fiction.Diplomatic Influence at 97.7 for China is not an accident. It is the sound of the Global South finally voting with its feet. From the Pacific Islands to Africa to Latin America, leaders now fly to Beijing first and Washington second, if at all. The Belt and Road is not charity; it is infrastructure with Chinese characteristics, and it works. The Americans offer sermons and sanctions. Guess which one gets the contracts.Even the residual American lead in Military Capability is shrinking faster than Lowy dares to admit.
Money Sire, money, and more money*
The raw dollar spend still looks impressive, but China’s defence budget now buys more ships, more missiles, more drones, and more hypersonic weapons than the equivalent U.S. dollars, because Beijing doesn’t have to pay San Diego rent or Raytheon profit margins. And while Washington scatters its forces across 800 foreign bases, China concentrates overwhelming power within the First Island Chain. In the Western Pacific, the military balance has already flipped; Lowy just hasn’t caught up with the calendar.The most delicious irony? The very categories where America still “wins” are the ones that are actively eroding its position. Defence Networks built on coercion breed resentment. Cultural Influence built on Hollywood and pop music is being crowded out by TikTok, K-pop, and Bollywood in the markets that matter. The United States is living off inherited capital; China is generating new capital every day.So let us translate Lowy’s 2025 index into plain English:The United States remains the world’s most formidable military spender and treaty collector.
China is already the world’s economic superpower, diplomatic superpower, and the country best positioned for the future.In other words, China has won the only parts of the contest that will decide who writes the rules of the twenty-first century. The United States has won the beauty pageant for the twentieth.Australia’s foreign-policy establishment will, of course, keep reciting the Lowy liturgy because admitting the truth would force Canberra to choose between its history and its geography. But the numbers no longer lie, no matter how creatively you weight them.The dragon has not merely awakened. It has already taken the chessboard. The West is still arguing about who gets to move the pawns.
*“Three things are necessary for war, Majesty: money, money, and more money,” Field marshal Raimondo Montecuccoli,17th-century.
“These authoritative weightings reflect the collective judgement of Lowy Institute experts based on relevant academic literature and consultations with policymakers from the region. They take into account the dimensions of power considered most advantageous to countries given the current geopolitical landscape of the region”:
Economic capability 17.5%
Military capability 17.5%
Resilience 10.0%
Future resources 10.0%
Economic relationships 15.0%
Defence networks 10.0%
Diplomatic influence10.0%
Cultural influence10.0%.
The Index’s measures and sub-measures seek to capture the diverse qualities that enable countries to pursue favourable geopolitical outcomes, as well as to shape and respond to their external environment: Corporate giants, Global reserve currency, International currency share, Official reserves, Export credit agencies, Sovereign wealth funds
TECHNOLOGY
High-tech exports, Productivity, Human resources in R&D, R&D spending (% of GDP), Nobel prizes (sciences), Supercomputers, Satellites launched, Renewable energy
CONNECTIVITY
Global exports, Global imports, Global investment outflows, Global investment inflows, Merchant fleet, Global travel connectivity