But as the US reaches the limits of its security-based diplomacy, China’s trade and investment-based strategy is also running into trouble.
President Xi Jinping’s efforts to revive China’s domestic economy through a renewed export drive is unsettling many developing countries, which fear their domestic industries are being undermined. Indonesia, Mexico, Brazil, India and Chile have all recently raised tariffs on Chinese goods, highlighting what the author James Crabtree calls “a major strategic dilemma for China, as policies designed to restore its domestic economy threaten to undermine its ties with the Global South”.
It is true that American support for Israel has damaged the US in the global south, particularly in Muslim countries. But China has paid a heavy reputational cost in Europe because of its support for Russia.
UPSIDES AND DOWNSIDES TO US-CHINA RIVALRY
The competition between the US and China is not all bad, as far as many third countries are concerned. Nations such as Saudi Arabia, South Africa, the Philippines and Brazil feel they have more freedom to defy either Washington or Beijing in a bipolar system.
But even for the non-aligned, there are considerable downsides to the growing rivalry between the US and China.
Protectionism and the bifurcation of the global economy will ultimately damage economic growth for everyone. A new arms race is a waste of resources and increases the risk of a catastrophic war.
And the rivalry between China and the US also makes it much less likely that the two countries will work together on the global challenges that threaten everybody – such as unregulated artificial intelligence and unconstrained global warming.
The joys of a new cold war can be greatly exaggerated.
