US-China Relations: Managing Differences Remains an Urgent Challenge

Summary

US-China relations are a complicated mix of positive and negative elements, competition and cooperation. Conflict between the US and China is not inevitable. In agreeing to establish a new type of major power relationship, Presidents Obama and Xi Jinping have prioritized the need to manage differences and avoid confrontation and conflict. Both leaders are focused on reinvigorating their economies and addressing other pressing domestic challenges, and hope to avoid bilateral strains where possible.

Nevertheless, it remains possible that the US and China will be unable to sustain an amicable relationship. In this regard, there are three broad categories that deserve discussion: (1) tensions could increase over political and economic issues; (2) a military conflict could occur either as a result of escalation of an inadvertent incident or deliberate action; and (3) a Cold War-like strategic competition could emerge over time as a consequence of increasing mistrust and diverging interests.

Possible Tensions over Political and Economic Issues

Friction over political and economic issues is commonplace in the US-China relationship. In the past few years, Washington and Beijing have bickered over the exchange rate of the renminbi; China's unwillingness to condemn North Korea's sinking of the South Korean vessel the Cheonan or its shelling of Yeonpyong Island; and Beijing's veto of United Nations Security Council resolutions aimed at imposing sanctions on Syria, to name only a few issues. In most cases, US-China differences over specific issues do not spill over into other areas and threaten to set back the entire bilateral relationship. In the foreseeable future, the majority of issues on which the US and China disagree are also not likely to threaten the overall relationship. There are, however, a few potential matters that could send US-China ties into a tailspin.

Korea

Denuclearization remains a shared goal, but the US and China have never agreed on how to achieve it. At times the two nations have appeared to be in lock-step, for example in the aftermath of North Korea's third nuclear test when both joined the other members of the UN Security Council in passing a resolution that tightened sanctions on North Korea. In the future, cooperation on North Korea could go badly and sour US-China ties, but not end up in a US-China military confrontation. North Korean military provocations against South Korea or proliferation of nuclear material could prompt the US to seek to overthrow the regime in Pyongyang.