China Quarterly of International Strategic Studies

Since the normalization of China-U.S. relations in 1979, there have been various disputes and friction between both countries. But their common interests far outweigh their differences and win-win cooperation has been the defining feature of the bilateral relationship. Over the past four decades, both countries have benefited enormously from their stable and healthy interactions, which contribute to peace, stability and prosperity of the world. However, the Trump administration has deliberated major shifts to the U.S.’ China policy, labeling China as a “revisionist power” and “strategic rival” while setting many barriers to trade, economic, technological, educational and cultural exchange and cooperation. Despite the ongoing transformation of the strategic relationship between both countries, China and the United States are unlikely to enter into a “de-coupling” or a new Cold War. Faced by growing strategic uncertainties, it is still possible for both countries to maintain a generally stable relationship based on their vast common interests. For China, it is important to exercise utmost strategic patience and stamina to ease friction and manage competition with the United States while also promoting the positive aspects of their bilateral relations.

With the rise of China and relative decline of the United States, the question of whether both countries will fall into the so-called “Thucydides’ Trap” — an analogy to the Peloponnesian War in ancient Greece — has triggered heated debate within international academia. By discussing the misunderstanding about the concept and conducting a three-level analysis of modern Sino-U.S. relations, this article identifies a few major flaws in making a simple analogy between the Athens-Sparta confrontation in ancient Greece and the Sino-U.S. relationship today. It concludes that a war between China and the United States is unlikely to take place thanks to the confines of the international system, the different nature of alliance networks from the ancient Greek period, the economic interdependence among countries, and the changing public attitude toward war. It also suggests both countries expand their economic, political, security and cultural cooperation, so as to ultimately overcome the “Thucydides’ Trap.”

With high growth rates during the past two decades and the largest trade surplus with the United States, China is the primary target of the U.S. trade war efforts. Tariffs are the first shot in bilateral tensions that are multilateralizing and injuring global economic integration, coupled with ever more intense technology competition. The evolving global scenarios of U.S.-China trade and technology conflicts are the outcome of an ever more anxious America forsaking its multilateral cooperative stances for primacy doctrines. In the worst case, these conflicts may escalate into a “decoupling” of both economies and cause lasting global recession and new geopolitical confrontation. This gloomy scenario has become viable with the exceptional use of executive power by the post-9/11 U.S. administrations. The Trump administration, in particular, is predicated on “imperial presidency” that relies on an emergency status quo, new campaign finance, and “big money,” which poses significant risks not only to U.S.-China relations, but also to American democracy and existing international order.

Although the intensified trade disputes between China and the United States accord with the basic theory of international political economy, they are unlikely to escalate into a trade war in a world characterized by the inexorable forces of globalization. What lies behind the Trump administration’s aggressive trade policy toward China is a bipartisan consensus on the growing need to reduce U.S. trade deficits, rein in China’s non-market economic forces, slow down China’s technological innovation and industrial upgrading, as well as to create political pressure on China to rectify its allegedly malign practices in global economic arenas. Motivation analysis suggests that the ongoing trade disputes are a product of the United States trying to coerce a potential challenger into adjusting its industrial development strategy and to prevent a determined rising power from pursuing national revival on its own terms. Lessons drawn from the trade conflicts between Japan and the United States in the 1980s suggest that Beijing may encounter even more trade frictions with Washington in the next few years. China must stand its ground under growing political and economic pressure, define trade disputes in strictly economic terms, and deal flexibly with their impacts. The lasting trade tensions between China and the United States has also exposed Beijing’s strategic shortcomings and forced China to enhance its innovation capacity while fostering independent intellectual property, so as to consolidate its comprehensive national power.

Since the 2008 global financial crisis, the landscape of South-South cooperation has greatly changed mainly due to the ongoing power shift from the North to the South. Rising economies like China and India are taking the lead in driving forward the institutional development of South-South cooperation despite lingering challenges that call for collective actions and mutual support among developing countries. Based on the principle of achieving shared benefits through consultation and collaboration, China’s Belt and Road Initiative (BRI) has presented a good opportunity for reinvigorating South-South cooperation and drawing concerted efforts from the international community to reduce the global deficits in peace, development and governance. In the long run, the BRI is expected to facilitate a new round of economic globalization and help shape a more balanced and efficient system of global economic governance, which will serve as the basis for jointly building a “community of shared future for mankind” proposed by the Chinese government.

As China projects itself as an emerging donor of development aid, its development cooperation with Africa has garnered unprecedented attention from the world. While China is faced with many challenges in aid practices in Africa despite its remarkable achievements over the past decades, both developed countries and African countries set high expectations for China’s potential contribution. Against this backdrop, it is crucial for China to enhance trilateral cooperation with developed donors and share experience with them on how to manage aid programs. Based on successful cooperation in the past, China-U.S.-Africa trilateral cooperation will not only strengthen China-U.S. bilateral ties, but also improve China’s overall aid effectiveness to Africa. In the future, China should initiate more development cooperation programs and work to create a coordinating mechanism with the United States in areas of their common understanding and interests; it should also go beyond traditional means of assistance and try to get involved in the U.S.-led public-private partnership (PPP) projects.

Intended as a pilot flagship project under the Chinese-led Belt and Road Initiative (BRI), the China-Pakistan Economic Corridor (CPEC) has received relatively positive responses from actors in and outside the South Asian region. Islamabad, New Delhi, and Washington have offered their support to the project to varying degrees, because the financial commitments made by Beijing can help narrow the substantial funding gap for regional infrastructure connectivity. Nevertheless, enduring animosity and mistrust between India and Pakistan and growing strategic competition between Beijing and Washington present the biggest challenges to the project’s sustainable progress. Although the unfolding U.S.-China competition has not tangibly affected regional cooperation, as Washington’s enthusiasm for and investment in the U.S.-led Indo-Pacific Economic Corridor (IPEC) remain low compared with China’s down payment, the potential change in the balance of power in South Asia has triggered increasing concern from and collaboration between the United States and India. By highlighting the positive-sum logic of improved infrastructure interconnection as well as greater economic integration, and contributing to a more stable geopolitical environment in South Asia, Beijing can help alleviate the longstanding enmity between India and Pakistan and assuage Washington’s and New Delhi’s skepticism about its strategic intentions.

Although the Bangladesh-China-India-Myanmar Economic Corridor (BCIM-EC) has the potential to enhance economic and geo-strategic benefits of the four participating countries in the long run, its building process has often been stagnated due to India’s lingering concern about the implications of the Corridor for its national security and, more importantly, to the growing competition among major countries including China, the United States and India. Moreover, there remains ethnic insurgency in Northeast India and Myanmar as well as the Rohingya issue between Bangladesh and Myanmar, which poses lasting security threats to the building of the Corridor. By analyzing the nature of those challenges, this article shows that the emerging Indo-U.S. strategic coalition for checking China’s influence and India’s reluctant stance in building the BCIM-EC are the biggest challenges, whereas neither the ethnic insurgency nor the Rohingya issue can affect BCIM-EC building substantially. Therefore, it is concluded that the BCIM-EC cannot succeed unless China and India can both fully commit to the building process while enhancing all-round cooperation based on their mutual strategic trust.