US-China Relations in 2024

The US wants to contain China; Asian partners want to deter it. Philip Turner asks ..what does New Zealand want?

Foreign Minister Winston Peters got a warm welcome when he visited Washington two weeks ago.  He was one of several regional leaders visiting the US this month including Japanese Prime Minister Fumio Kishida and Philippines President ‘Bongbong’ Marcos. 

With the world dividing into an increasingly stark contest between liberalism and illiberalism, and Democrats and Republicans competing to be tough on China, the mood in Washington is upbeat with the idea the US is succeeding in rallying its friends in Asia to stand up to Chinese aggression.

Kishida led the pack, telling Congress that China's recent actions present  “the greatest strategic challenge…to the peace and stability of the international community at large”, and reassuring the US that Japan stood firmly beside it as a global partner. 

The big news from Kishida’s visit was that AUKUS has invited Japan to cooperate on advanced technology.  He in turn reiterated that Japan will increase its defence spending to 2% of GDP, and highlighted Japan’s expanded defence cooperation with the Quad, NATO and countries in the region, including the Philippines.

Peters sounded a consistent note, if less direct one. The US/NZ Joint Declaration issued during his visit spoke of working even more closely together with “our like-minded regional partners”, referring to the Quad, AUKUS, the Indo-Pacific Economic Framework for Prosperity (IPEF), NATO, and its partners in “the four Indo-Pacific democracies of New Zealand, Australia, Japan and the Republic of Korea”.

In his recent swing through Singapore, Thailand and the Philippines, Prime Minister Luxon hewed to a similar line. Each of his hosts agreed to enhance the relationship with New Zealand, with defence and security cooperation highlighted in all three countries. 

From the Asian side of the Pacific, doing more to deter aggressive behaviour by China (and Russia) makes a lot of sense.

China’s recent border clashes with India, with Japan in the East China Sea, across the straits of Taiwan and most glaringly with the Philippines in the South China Sea, have caused widespread alarm among its neighbours.

Kishida has explicitly warned that Chinese support for Russia’s invasion of Ukraine may translate into a direct threat to Taiwan (“Ukraine might represent the East Asia of tomorrow”).

The strongest reactions to date have come from India, Japan and the Philippines. 

After serious border clashes with India in 2020, China has deepened its military foothold in the area.   Some 120,000 troops are said to face each other across the border. 

Under Marcos the Philippines has begun to confront and publicize Chinese incursions into its EEZ in the South China Sea, with explicit support from the US. 

Japan has moved to adapt its traditional pacifist policy by increasing defence spending, loosening restrictions on arms exports and strengthening cooperation with neighbours such as Korea, Australia and the Philippines.

But leaders see these moves as defensive, aimed at deterring Chinese bad behaviour, while seeking to preserve economic ties and cooperation in other areas as far as possible.

South Korea is among those that have moved closer to the US in recent years, further strengthening its long-standing alliance relationship.  Yet its Foreign Minister Cho Tae-yul reiterated last week that China is “a key partner” with whom Korea will “continue to seek a mature and sound relationship”.

Similarly in November Japan’s Foreign Minister spoke of “future-oriented and practical cooperation between Japan, China and the ROK”, emphasizing economic cooperation and trade.

The view from Washington is rather different. 

In a remarkable article published earlier this month, Matt Pottinger and Mike Gallagher (respectively a former Trump official and a Republican Congressman), argued bluntly that the US must aggressively seek primacy over China.  

Just as in the US struggle with the Soviet Union, they described the US as engaged in another Cold War which it needs to “own and win”. Achieving that would require “greater friction in U.S.-Chinese relations”, and involve policies that “may feel uncomfortably confrontational”, but competition with China “must be won not managed”. 

This is a view from the right wing of the Republican Party, and very likely an audition for positions in a Trump 2.0 White House.  But the current feverish atmosphere of US politics makes it hard for anyone to take a nuanced view of China relations without being demonized as un-American.

Even Biden has had to ratchet up his stance in recent weeks, calling for example for a tripling of tariffs on Chinese steel imports, and restricting trade in sectors like solar panels and shipbuilding.

The Biden administration maintains its targets are limited – National Security Advisor Jake Sullivan has memorably described the US approach as a “small yard high fence” strategy - and that it remains open to cooperation with China in areas such as climate change. 

But its stress on economic nationalism (tariffs, ‘reshoring’ and massive domestic subsidies for domestic manufacturing) and its promotion of IPEF (which notably excludes China), suggests Democrats share with Republicans the aim of containing China economically as well as militarily.

This is where Asian and US views diverge.

Nearly all the US’ friends in Asia have China as their number one trading partner.  Whether or not China ever becomes number one in the world by GDP (it is already there on a PPP basis), Asian governments are clear that China is already too important and too enmeshed in the global economy to be sidelined.

Most Asian partners find the US’ efforts to engage economically in Asia, such as IPEF, underwhelming. 

High-tech leaders South Korea and Japan share to some extent the US desire to protect and promote their own industries from Chinese competition (and to diversify semiconductor manufacturing away from Taiwan).

But there is little enthusiasm anywhere in the region for combatting Chinese growth in itself. 

That is seen as both wildly unrealistic, and damaging to everyone’s economies.

On the security side, support for deterrence of China through joint exercises and training stops short of confrontation.

Even the Philippines, which has been the victim of brutal clashes with Chinese coastguard vessels in the South China Sea, seeks to balance economic and security interests and insists that it values economic partnership with China.

While most regional leaders are reticent to speak out publicly, Singapore is openly critical of US calls for primacy and confrontation. 

Prime Minister Lee Hsien Loong, whom PM Luxon met this month, urged the US and China in 2020 to “work out a modus vivendi that will be competitive in some areas without allowing rivalry to poison cooperation in others”. 

He observed that Asian countries see the United States as a legitimate resident power that has vital interests in the region. But at the same time, “China is a reality on the doorstep”.

Asian countries did not want to be forced to choose.  If either attempted to force a choice, for example if Washington tried to contain China’s rise or Beijing sought to build an exclusive sphere of influence in Asia, “they will begin a course of confrontation that will last decades”.

He concluded that “the US must decide whether to view China’s rise as an existential threat and try to hold China back through all available means or to accept China as a major power in its own right”. 

Former Singaporean Secretary of Foreign Affairs Bilahari Kausikan rejects the Cold War analogy as “altogether inappropriate”. 

He observes that China, unlike the former Soviet Union, is inescapably tied up with the global economy.

“Even the closest U.S. ally is never going to cut itself off from China politically or economically. Few if any Western companies are ever going to entirely forswear investing in the Chinese market even if they will be more cautious about transferring technology there”.

These words likely resonate with New Zealand exporters concerned about the current escalation of tensions. 

Recently there has been vigorous debate about whether New Zealand should join Pillar 2 of AUKUS or not.

Yet there has been little debate about what the desired end-point of our relationship with China should be, and whether AUKUS might help or hinder that objective. 

Both government and opposition have been silent on whether we are seeking to manage China’s rise in the region or to limit it.

This might be a good time to consider which side of this debate we want to be on - the “I win you lose” approach advocated by Pottinger and Gallagher, or the more realist view of Singapore,  where both powers acknowledge they are both going to be around for a long time, and need to find a way to share the globe with each other – without one side or the other necessarily “winning”. 

The opinions expressed are those of the author 

- Asia Media Centre