New Realities in the US-China Relationship

New realities in US-China Relations

Recently, the United States welcomed the first state visit of a new Chinese leader at a time when the presidential election campaign in the country has started, and the US-China relationship is at an important inflection point. Nearly four decades after the normalization of relations between the two superpowers, new realities in China, the United States and the international community are changing the way Americans and Chinese view their bilateral relationship and forcing a re-examination of the principles that underpin their policies.

The global arena has changed dramatically in recent years. Today, there are few challenges that the United States or China could solve alone and few scenarios in which one country could succeed without the success of the other. Whereas only a decade ago, US-China relations were focused primarily on bilateral or even regional issues, but today the agenda is global. Each country’s ability to achieve its national objectives is threatened by the same set of international challenges. The future prosperity and security of the both superpowers is increasingly intertwined. The stakes for a cooperative and constructive bilateral relationship have never been so much higher.

At the same time, there are new realities that pull the two countries apart. China is now the world’s second largest economy and has accumulated significant influence on the global stage. Its new leader, Chinese President Xi Jinping, has charisma as well as confidence that have contributed to his ability to consolidate more power and reorient his country in a more ambitious direction than either of his two predecessors. But Xi is also more nationalistic, risk-tolerant and ideological than his predecessors, and his more active and muscular approach to foreign affairs can, at times, be at odds with US interests and reinforces the notion that what China decides to do with its newfound power, may not always align with America’s national objectives.

New realities in US-China Relations 1In the Asia-Pacific, for example, Xi is pursuing a dual-track strategy that on the one hand employs the ace in China’s deck — economic might — to convince neighbours that China’s continual rise will benefit them, and on the other hand involves a much more aggressive approach to strengthen China’s claims to disputed territorial and maritime features in adjacent waters, often through coercion and without due regard for international law. Both tracks are hugely ambitious — Xi’s ‘One Belt, One Road’ project, for example, aims to connect China to Europe by land routes traversing Russia and the Middle East and sea routes navigating through the Malacca Strait and the Gulf of Aden. Xi’s revanchism in the South China Sea, meanwhile, has recovered over 2,000 acres during the last 18 months — more than all other claimants combined and more than in the entire history of the region. 

This proactive foreign policy represents a major departure from the Chinese foreign policy principle “taoguangyanghui” which dictates that China should keep a low profile on the international stage and focus on its development efforts at home. Potentially more troubling, however, are the rising frictions in the US-China commercial relationship, exacerbated by accusations of cyber hacking, China’s use of industrial policy, and a slowing Chinese economy. The US business community has historically been an anchor of stability between the two countries, especially during inevitable periods of tension. Yet, growing concerns about protectionist tendencies that seem intended to close the door to foreign companies under the pretext of national security threaten to undermine the support of these reliable stakeholders. Civil society and human rights groups are also concerned with developments in China calling for a ban on Western textbooks, a crackdown on NGOs and the silencing of dissidents.

Thus, as China has emerged as a formidable economic and geopolitical competitor to the US, its differences with the latter have become more (not less) pronounced. What many Chinese are now calling China’s renaissance while welcomed by the United States, is different than what many in the West expected. Americans traditionally believed that China’s success was good for the US and are now beginning to question this assumption. And in these doubts, a debate has emerged over whether or not Washington has the right framework to respond to a rising China.

New realities in US-China Relations 2

Contours of the US policy debate on China

At the core of the US debate are questions about the strategic intentions of a rising China, the long-term sustainability of US primacy in the Asia-Pacific, and the roles of both nations in the region going forward. One side of the extreme argues that growing Chinese power is undermining US leadership in the Asia-Pacific. Without reassurances of sustained US predominance, countries on China’s borders will reorient their defence postures in ways that could lead to an intensified regional arms race and an environment where conflict is more likely. This argument supposes that China’s ultimate aims are not limited to pushing the United States out of Asia, but also include undermining the US-led international system and US global leadership. Thus, the US should move assertively to block China’s rise.

On the other side of the extreme are those who argue that Beijing’s aims are limited to strengthening its security and enhancing its regional influence, which the United States and its allies should not necessarily see as a threat. Washington should come to terms with the reality that US predominance in the region is unsustainable given China’s growing economic clout and military modernization, and attempting to preserve it would be dangerous and ultimately unsuccessful. In order to avoid conflict, this contingent argues that Washington should share power with China and further assist its integration into the current international order.

Both extremes are flawed and dangerous policy choices. If the US moves toward a balance of power with China, it will be based on a premature assumption that China’s continual rise to regional predominance is inevitable. China confronts enormous political, economic and social challenges at home and faces several major powers and nuclear states in the region, not to mention a US military that for the foreseeable future is expected to endure as the strongest in the world. Furthermore, it is not in the interests of the United States or those of its allies to have a G2 with China.

On the other hand, a zero-sum US-China relationship, a divided Asia and a greater likelihood of military conflicts would be much to the detriment of US interests and those of its allies. A containment policy could lead China to close its doors to cooperation and engagement with the United States. The interests of the US business community, which, despite recent concerns, wants to maintain strong trade ties with China and have access to its markets and investment, would be threatened. Additionally, growing Chinese investment in the United States would also be threatened.

A move by the United States to a more confrontational approach with China also ignores the fact that US allies and partners — all now larger trading partners with China than with the United States — are not looking to choose sides between the two countries. They want good relations with both. While on one hand they hope the US can serve as a useful counterbalance to China’s growing influence, on the other, they want to benefit from increasing trade and investment with China.

Also at risk would be the interests of nearly every other nation with a stake in trying to address common global challenges, from climate change to transnational terrorism. And a policy of blocking China’s rise would further confirm the widespread view in China that the US is out to contain it and lend credence to hardliners who want to take an even less accommodating approach toward the United States. Revisions to US policy toward China must account for Beijing’s likely reactions and the second — and third-order consequences.

How to advance relations amidst new realities?

New realities in US-China Relations 3The success of Washington’s engagement with China starts with an understanding of these new global realities shaping this bilateral relationship. Rather than moving toward extreme policy courses amidst these new challenges, the US strategy for advancing relations with China should begin with a comprehensive approach to the Asia-Pacific region and be guided by US leadership globally. The United States needs to get its approach to the region right, get its economy and political system working again, and project leadership and staying power on the regional and international stages. Only then will it be able to lead a much more deliberate effort to work with China where it has common interests, to pursue a more effective strategy to shape Chinese decision-making, and to invest adequately in current and future military capabilities.

The US’ ability to uphold regional rules and norms in the Asia-Pacific, strengthen institutions, lead the building and modernizing of trade and economic architectures, and modernize its strong alliance system is critical to a secure and peaceful region and constructive relations with China. Although a majority of Americans view Asia as the most important region to US interests, many question US political will, staying power and resources to implement its rebalancing policy in the region. The US needs to get its economy growing again, get its political system out of gridlock and keep its military funded and capable of meeting the challenges of the twenty-first century. America’s national security, global credibility and regional leadership rest on the foundation of its fiscal and economic health and the effectiveness of its policymakers and legislators.

When it comes to China, the United States should keep in mind several key principles that have guided a mix of competition and cooperation with China over the past four decades: where both countries have common interests, the former must find ways to work with the latter; where the two countries have differences, leaders need to manage and narrow them; and given the uncertainties of China’s trajectory, the US must maintain a hedging strategy and ensure its military is prepared and capable of defending US interests today, and in the future as well.

Recently, the United States has struggled with all three major components of its China policy. It has fallen short in its efforts to expand meaningful cooperation with China on addressing shared regional and global challenges. Washington and Beijing have been unable to effectively manage their differences — tensions in the South China Sea and the cyber realm have come to define the bilateral relationship and set it on a path toward confrontation. With few positive narratives or examples of tangible cooperation between the two countries, the military hedging strategies threaten to dominate front-page news.

As then Deputy Secretary of State Robert Zoellick stressed in an important speech in 2005, a more cooperative relationship with a China that is a major stakeholder on global security and economic issues will not only make it easier for the United States to handle the wide range of global challenges we face in the years ahead, but is also essential to sustaining the existing, open international system. While cooperation will not mean that both countries do not have serious differences and disagreements that they will need to manage, it will provide a broader framework for constructive engagement. If the US can find ways to enhance cooperation with China and change the narrative of this bilateral relationship among the publics of both countries by demonstrating that the US and China can be a positive force in the international community, then this will give them space to deal with some of the more challenging issues in this relationship.


While there are many challenges in the US-China relationship, Washington cannot lose sight of the fact that this is an important relationship — perhaps the most consequential one for the US in this century. Whether or not Washington gets this relationship right will determine whether or not the US is able to take advantage of the Asia-Pacific region’s growth, and make progress on addressing critical global challenges in ways that yield benefits to the citizens of both countries, their neighbours and the world. The US-China relationship has been and will continue to be composed of both cooperation and competition, but because of the new global realities of this relationship, both countries’ leadership must do a better job of balancing these two dimensions. If successful, their constructive cooperation will benefit not just the two countries but the entire international community.

Courtesy: Carnegie-Tsinghua Center for Global Policy.

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