China's growth since the reforms of Deng Xiaoping has been incredible, writes Robert B. Zoellick in Australia's Financial Review. "Yet the internal challenges of the transformation remain tremendous, as President Xi Jinping's new structural reforms and push to revitalise the Communist Party have highlighted."

The Obama administration’s negative response to China’s proposed Asian Infrastructure Investment Bank was a strategic mistake. Though some Chinese moves might be destabilising and require US resistance, this initiative should have been welcomed.

The US should be careful about opposing ventures that are popular and likely to proceed. Losing fights does not build confidence. Moreover, the new bank’s purpose — to develop infrastructure in Asia — is a good goal. The world economy needs more growth. Many emerging markets are eager to boost productivity and growth by lowering costs of transportation, improving energy availability, enhancing communications networks, and distributing clean water.

The AIIB offers an opportunity to strengthen the very international economic system that the US created and sustained. The AIIB’s designated leader, Jin Liqun, a former vice-president of the Asian Development Bank, sought advice in Washington. He engaged an American lawyer who was the World Bank’s leading specialist on governance. He also reached out to another American who had served as World Bank country director for China and then worked with the US embassy.

If the AIIB was indeed threatening the American-led multilateral economic order, as its opponents seemed to believe, then its Chinese founders chose a curiously open and co-operative way of doing so.

Belfer Center Senior Fellow Robert Zoellick, chairman of Goldman Sachs' International Advisors, was the lead U.S. Negotiator in the Two Plus Four process for Germany’s unification, serving under Secretary of State James Baker. The German government awarded Zoellick the Knight Commanders Cross for his work on unification. In this Q&A with Belfer Center Director of Communications Josh Burek, Zoellick shares lessons from the fall of the wall 25 years ago and the crucial diplomacy that followed.

When President Obama assumed office, he wanted to reverse what he perceived as President Bush's overreach in foreign policy, writes Robert B. Zoellick. "He determined on withdrawal from wars in Iraq and Afghanistan, despite the risks of unraveling that we are witnessing today. Then his administration failed to offset retrenchment with a strategic initiative. In contrast, as America retreated from Vietnam, President Richard Nixon and his adviser Henry Kissinger seized the strategic initiative by opening relations with China and resetting the geopolitical chessboard to U.S. advantage."

Robert Zoellick, senior fellow with Harvard Kennedy School’s Belfer Center and former head of the World Bank, spoke to a crowd of about 150 as part of the Harvard University Center for the Environment’s (HUCE) “China 2035: Energy, Climate, Development” lecture series. As reported in the Harvard Gazette, “HUCE Director Daniel Schrag, the Sturgis Hooper Professor of Geology and professor of environmental science and engineering, introduced the event, saying that it’s important to understand China because it looms so large on the world stage.”

"Twenty years ago Zhu Rongji, China’s former premier, shrewdly used negotiations over his country’s accession to the World Trade Organisation to open its domestic markets to greater competition and import international standards into its legal system," writes Robert Zoellick. "This produced more than a decade of strong growth, and gave China a greater stake in global trade."

This week, U.S. President Barack Obama will travel to Mexico, where he will meet with his North American counterparts, Canadian Prime Minister Stephen Harper and Mexican President Enrique Peña-Nieto. David Petraeus and Robert Zoellick writ: "The summit points to a great strategic opportunity: 20 years after the North American Free Trade Agreement entered into force, all three countries have the chance to forge a new forward-looking agenda for North American competitiveness and integration and thereby increase the economic growth and global influence of each."

America's commitment to free trade will be tested in 2014. After years of indifference to trade policy, the Obama administration now has an agenda. Congress must decide whether the U.S. will lead in opening markets and creating fair rules for free enterprise in a new international economy. Where will Republicans stand?

Over the past five years, developing economies have been responsible for over two-thirds of global economic growth. Over the past decade, the share of developed-country exports bought by their developing partners has increased to almost 50% from 25%. In recent years China alone has consumed about half the world's cement, iron ore, steel, coal and lead, lifting commodity prices.

The upcoming Annenberg summit between Presidents Barack Obama of the US and Xi Jinping of China could define the strategic relationship between the two most powerful countries in the world for years to come. Mr Xi has called for a “new type of great power relationship”. Tom Donilon, the US national security adviser, has suggested a “new model of relations between an existing power and an emerging one”.