Four Potential Scenarios For Medium-to-Long-Term Development Of US-China Relations – Analysis

By He Jun

In the recent visit of the U.S. Secretary of State Antony Blinken to China, the Chinese raised a viewpoint: whether the U.S. and China are to be partners or rivals, so as to fasten the “first button” for the relationship to develop stably. However, the answers have long been known. The U.S. National Security Strategy clearly states that China is a long-term strategic competitor, and the core of its national security is to contain the challenges posed by China.

In a February interview on the CBS program 60 Minutes, U.S. Ambassador to China Nicholas Burns admitted frankly about the relationship: China is an “adversary” stronger than the Soviet Union, and the relationship between the U.S. and China is that of competition, and that Americans do not want to live in a world “where the Chinese are the dominant country”. This view should represent the deep-seated thoughts of the U.S. government, politicians, and elites, and is the basis for the decision-making of the current Congress and government.

The current U.S.-China relationship has solidified strategically and is in a state of sustained, somewhat tense opposition. However, there is still room for improvement and communication in terms of technology, which can be managed to a certain extent, but the main purpose of management is not for development but to avoid sudden risks. Overall, the medium to long-term relationship between the two nations will be in a state of “strategic suspicion, strategic opposition, technological control, and partial cooperation”, which is a long-term game based on established strategies. This state may continue for 20-30 years until, after a long period of “competition”, when the relationship reaches a new balance. It should be noted that this rebalancing does not necessarily mean an equal balance of power, but rather achieving relative stability in a certain state without structural changes.

How will the medium to long-term U.S.-China relationship develop? This is an important question of international concern. There are roughly four scenarios predicted by different discussions.

The first scenario is that the U.S. remains strong while China weakens. The U.S. maintains its position as the global leader, retains influence among its allies, continues to uphold the dominance of the U.S. dollar, and is capable of uniting its allies to impose sanctions and containment measures against China. On the other hand, China, facing an aging population, struggles to sustain economic growth and cannot surpass the U.S. in terms of total economic output. China is forced to allocate more energy and resources to address domestic issues such as financial risks, debt, aging population, and declining birth rates. Due to lagging institutional reforms, China fails to stimulate new systemic innovations. The emergence of globally competitive Chinese technology companies like Huawei is considered accidental rather than an inevitable outcome of the existing institutional mechanism in the country. China’s capacity for technological innovation and industrialization has not significantly improved. In international affairs, the conflict between Russia and Ukraine is not expected to be prolonged and will likely end in some form within five years. The conflict in the Middle East, particularly involving Israel, will also end more quickly, no longer involving the U.S. As the U.S. disengages from these conflicts, it will free up more energy and resources to counter China. While it is unlikely for the U.S. and China to enter a “Cold War” mode like when it faced the Soviet Union, in this scenario, China is in a weaker position in long-term competition, excluded from the new globalization, and the world will eventually become accustomed to this. Overall, the world remains unipolar, which is most favorable to the U.S. and least favorable to China.

The second scenario is that China gradually strengthens while the U.S. weakens. Due to various reasons, the U.S. might find it challenging to maintain its position as the global leader in the long term. American and Western diplomatic values are no longer universally recognized worldwide, and the “double standard” style of international rules is widely disregarded by the Global South. The conflict between Russia and Ukraine could persist for a long time, at least during Putin’s tenure, becoming a long-term burden on the U.S. and Europe, akin to another Afghanistan. Division emerges between new and old Europe, and the European economy remains in a prolonged slump due to sustained impacts. By then, China would adjust its development strategy, refocusing on development as the primary task, advancing reform and opening-up centered on marketization, particularly promoting vigorous and profound institutional reforms, providing a new institutional environment and space for economic development. In this scenario, China will be able to maintain stable and sustained economic growth, effectively cope with the impact of aging population waves, systematically enhance its capacity for technological innovation, develop technological innovation industries, and foster more tech companies similar to Huawei. Due to its commitment to openness, China could then effectively counter the U.S.’ attempts of “small yard, high fence”.

The third scenario would be where a localized hot war erupts between the U.S. and China, resulting in mutual damage. The trigger for the hot war is the Taiwan issue. The Taiwan Strait crisis intensifies, leading to mainland China’s military reunification efforts and U.S. military intervention. The war, if it did happen, would remain confined to a localized area. In the worst-case scenario, major cities, including those in Taiwan, along the southeastern coast of China, as well as its technological and advanced industrial capabilities, would be destroyed, with the exchange of military assets for the U.S. in the Western Pacific and even Hawaii, including military bases in Japan, South Korea, and the Philippines. However, even if the hot war is confined to a regional scope, the resulting economic and financial shocks would severely impact the global economy. Globalization would be severely disrupted, and the East Asian and ASEAN economic circles would be almost destroyed. Under such a situation, if the regime and geopolitical situation in North Korea remain unchanged, it could become a significant uncertainty in the East Asian hot war, at least in terms of restraining a considerable portion of Japan, South Korea, and U.S. military forces. This is a destructive hypothetical scenario, detrimental to both the U.S. and China, with the latter suffering particularly severe setbacks.

The last scenario is the maintaining of the status quo, with the basic global framework remaining unchanged. The U.S. and China remain engaged in a long-term game, with the former still maintaining superiority over the latter, but unable to dominate the increasingly growing China. The U.S. continues to develop while struggling to contain its strategic competitors, while China faces challenging development within the long-term containment environment created by the U.S. Although there is no outbreak of a hot war, China may be drifting further away from the Western world dominated by the U.S., leading to the deepening and solidifying of the divisions between the two powers. The world will gradually divide into two major camps, which may not necessarily resemble the military confrontations of the Cold War era but rather more closely resemble “geopolitical economic blocs”.

It should be pointed out that the four scenario assessments mentioned above have their limitations. The U.S.-China relationship exists within the global context, rather than a common bilateral relationship between the two countries. Furthermore, the changes in the “strengths” and “weaknesses” of countries also need to be defined in terms of their connotations. Placed in different historical contexts, the reference points for measuring “strengths” and “weaknesses” may differ, leading to different conclusions.

Final analysis conclusion:

As the bilateral relationship with the most comprehensive impact on the planet, the long-term prospects of the U.S.-China relationship are far from being optimistic. The strategic containment of China as imposed by the U.S. will not change, and efforts to improve relations between the two countries are more focused on risk management at the technological and policy levels. At the fundamental strategic level, neither country harbors any unrealistic expectations. The rough outlines of the four scenarios for the medium to long-term U.S.-China relationship as listed above depict several possible trajectories for the future of their relationship. What is relatively certain is that, on this small planet, mutual tolerance and peaceful development are most in line with the interests of humanity; there is no room for two major powers to engage in a deadly struggle.

He Jun is a researcher at ANBOUND