The US-China Rivalry is Unlikely to Disappear, ever

The schmoozing in Bali isn’t going to last

By: Salman Rafi Sheikh

When presidents Joe Biden and Xi Jinping met recently on the sidelines of the G20 summit in Bali, it seemed to have a sobering effect on the tense US-China ties which are increasingly drifting into ‘Cold War 2.0.’ As such, mainstream media said that the meeting, despite continuing disagreements between both countries, was successful in cooling fears of another Cold War.

The meeting was certainly a striking contrast to the distance between Biden and Putin, and the fact Biden and Xi met shows there is some flexibility in both countries. The important question is: how durable is that flexibility? Will this thaw have a permanent effect, or is it just a temporary phase leading to a full-blown conflict later?

Softening the belligerent Trump-era rhetoric on China – which Biden did not immediately change after winning the 2020 national election – makes sense for Washington more than ever now, since the administration would do better tackling just one strategic competitor, Russia, at the moment. Opening two fronts would only exacerbate the situation not only for the US but also for its allies in Europe which are already facing a severe economic crunch.

But, even though this temporary thaw may suppress existing tensions, the US-China rivalry is unlikely to produce a fundamental shift towards normalization, or what Biden called ‘responsible competition.’

Specifically, the US-China rivalry is not bilateral, it is global. It is underpinned by both countries’ ambitions to shape global politics in ways that best serve their interests. Whereas Washington’s core interest is to maintain the present world order, Beijing is actively seeking to build an alternative one – a system, for instance, not dominated by the US or the US dollar, and a system that allows for the use of alternative currencies for trade., particularly the yuan. In pushing for this system (in alliance with Russia), Beijing is directly challenging the underlying force of US domination of world politics post-World War II.

Beijing is unlikely to give up this ambition and the US is unlikely to give up its dominant position. Tensions, therefore, are unlikely to disappear, although they become suppressed under given circumstances, but they are quite likely to become active under other circumstances, as there are many flashpoints.

Apart from Taiwan, the South and East China seas, the US-China rivalry’s most important bone of contention is control of technology. Any country with control of state-of-the-art technology – especially, the production and supply of microchips – will have an edge. The US has had that edge for decades, which China is slowly but surely challenging.

On October 7, the Biden administration, with a view to restricting China’s access to modern technology and the growth of its economy and military, introduced unprecedented export controls over the supply of semiconductor chips to China.

The US officials said that the move was intended to prevent foreign firms selling chips based upon US technology, from selling chips to China and/or supplying Chinese firms with tools to make their own advanced chips. To quote US officials, the measure is intended to protect the “US technology leadership.”

The emphasis on ‘technology leadership’ translates directly into US leadership in almost all fields of economy, politics, and military strength. Cutting China off, therefore, means keeping the US dominant position intact. Beijing is not unaware of the underlying politics of export controls and will take countermeasures to secure its interests. This will keep the rivalry for global dominance alive.

As analysts have pointed out, while this ban will hurt China’s expansion in artificial intelligence and super computing, it is also likely to turbocharge China’s domestic manufacturing of semiconductor and memory chips. In fact, China is already taking steps towards that end.

According to Beijing’s “Made in China 2025” initiative, a self-sufficiency level of 75 percent is to be achieved by 2030. At present, China’s domestic chip manufacturing industry accounts only for 17 percent. But China is heavily subsidizing this industry. And, this subsidizing seems to be working, as Chinese manufacturers seem to have made a significant breakthrough towards advanced chip-making technology.

But the US wants to prevent such breakthroughs for its own sake. As the US Secretary of State Antony Blinken said after the export controls were introduced, “We are at an inflection point. The post-Cold War world has come to an end, and there is an intense competition underway to shape what comes next. And at the heart of that competition is technology. Technology will in many ways retool our economies. It will reform our militaries. It will reshape the lives of people across the planet. And so it’s profoundly a source of national strength.”

While Blinken did not say that the US was entering ‘Cold War 2.0.’ and Biden specifically denied it in Bali, there is little denying that restricting or denying access to technology, which has direct economic and military implications, is straight out of the Cold War playbook. In other words, even if US and Chinese officials continue to deny, or suppress, the Cold War rhetoric, the ground realities tell a different story.

Therefore, even though Biden told Xi that the US will continue to compete with China, the decision to restrict China’s access to these chips shows that Washington is not competing in good faith, nor should Beijing expect the US to do so. The fact of the matter is the US intends to kill its competition and Beijing wants to increase its domestic capacity to compete with the US and displace its dominance in the tech field, as well as challenging Washington in other economic and military fields.

This competition is neither temporary nor ‘positive’ enough to suppress conflict and invite a healthy relationship. It is underpinned by a broader structural conflict of domination and counter-domination, and the conflict will continue to inform other flashpoints of US-China relations, including Taiwan, Hong Kong, Xinjiang, Russia/Ukraine and, of course, Beijing’s Belt and Road Initiative, which Washington sees as a giant Chinese debt-trap. China sees it as an initiative to put itself at the center of the world of commerce and industry.