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1. The US-China Fight for Supremacy (Part 1: The Stakes)
It is now becoming harder to pretend that this is anything other than a war shy of the
shooting of bullets and setting off missiles at each other. What many perceived as a
mercantilist trade war set off by a President who viewed processes, agreements and
outcomes in very simplistic terms has slowly become a multi-dimensional battle for
dominance between the two powers.
Whilst it was well known that Trump’s early advisor Steve Bannon had viewed China
through that same outdated ‘Clash of Civilizations’ prism that the Bush administration
applied to the Middle Eastern world- and specifically, what they perceived as radical Islam,
he left the administration near the start. But the legacy seems to live on with a fear of the
emergence of China as a global superpower to rival the US in terms of influence and reach.
The US has watched with some awe and apprehension the increasing muscle-flexing of the
Chinese for some years now. The One Belt One Road initiative (either OBOR or BRI) by the
Chinese government to improve road, rail and sea connectivity through the Eurasian
landmass through a systemof tied loans to multiple countries may have been a response by
the Chinese government to the US which had announced the New Silk Road initiative under
the Obama Administration. They had planned to build infrastructure and ties through
Afghanistan and the Central Asian nations to create a transit area to supply more efficiently
to Europe by creating critical energy and trade and transport markets back in 2011. China
naturally had to counter with their own initiative once the American proposals never
fructified. President Xi Jinping launched the Chinese initiative in 2013.

2. The failure of their own plans and the determined thrust of the Chinese ones are giving the
US the same nightmares as the elder Cato used to have when he would end each of his
speeches in the Roman senate with Carthago Delenda Est- Carthage must be destroyed; the
enemy who had been twice defeated by Rome in two wars lasting 39 years in total was
again exporting its way to immense wealth rapidly and challenging Rome’s dominance.
US hegemony is threatened. It does not have the political will to commit such large
resources to developing infrastructure in other countries especially when the same
expenditure would pay direct dividends to Chinese expansion. Direct connectivity to rich
Europe would lower the cost of access to the wealthy European markets for Chinese goods-
hurting American trade. As it is, the current US President is an avowed anti-globalist, highly
cost-conscious- even at the risk of strategic investments and sees the only way to counter
mercantilist China is through mercantilist reprisals. Hence, the costly and damaging
escalating tit-for-tat trade tariffs imposed on each other, the bellicose language and
willingness to exert strong-arm tactics by both nations is threatening to erupt into
something beyond the commercial.
The Chinese are starting to exert what they feel is their right to regional influence. They
have constructed entire islands in the South China Sea to extend their territorial claims-
antagonising their neighbours like Vietnam and the Philippines. Consequently, the US has
sent their warships to the area to reassert the international nature of the waters- a
provocative but legal act. The extension of Chinese loans to many African countries to build
infrastructure and secure sources for minerals and commodities for export to a resource
hungry China is a cause for concern across the globe. China has a policy dubbed ‘the string
of pearls’ which is meant to encircle its regional rival India through ties with all its
surrounding countries- Bangladesh, Nepal, Pakistan, Sri Lanka, Maldives and Burma. So,
there is no doubting China’s ambitions. It already has a strong economic influence across
the Asia-Pacific with even Australia almost a vassal state (given that 35% of all of its exports
go to China). China, Malaysia, Cambodia, Vietnam, Laos et al both supply to and buy heavily
from China- the world’s global supply hub has powerful and dependant interlinkages in the
region.
The US is used to being the dominant hegemon striding the globe. It spends more on its
military than the next seven countries combined. The largest number of fighter aircraft in
the world belongs to the US Air-Force, the second largest belongs to the US Navy. More
importantly, its economy is the largest in the world even though it is now looking over its
shoulder at the rapid growth of the Chinese- the US has a $21 trillion economy, the Chinese
are closing the gap fast at $14 trillion. The last leg of the tripod- and arguably the most
insidious, is the complete dominance of the US Dollar. It is the currency of global trade. It is
where financial markets go to for capital, where countries store their foreign exchange
reserves, it is the country with the largest consumer market in the world. It is also
weaponised by the Americans- how they influence international relations. Their embargos
against Iran, Venezuela, North Korea, Russia have all depended upon the US being able to
warn third countries not to engage with these countries under threat of secondary
sanctions including the inability to transact at all with the US and using its currency.

3. The US- despite being seen as the global policeman in the past, has always imposed its
opinion across the globe. It asserts keenly the right to question the treatment of Uighurs in
China, Kashmiris in India, the maltreatment of the opposition in Venezuela without allowing
the reciprocal arrangement for others to criticise its internal policies against native
Americans or African-Americans. And it has not hesitated to involve itself militarily as it
wishes. These rights are not allowed anyone else. Actions by others are labelled as rogue
actions- such as the Russian annexation of Crimea in 2014.
The only country that can challenge the US now is China. It has wealth, size, influence and
the capacity to invest in construction like no other time in history. Whether in building
dams, cities, highways, railways or aircraft carriers the Chinese are on a trajectory that the
Americans find frightening. And they are the factory of the world. The US has- over the last
few decades, retreated to becoming a service and innovation-based economy. That is why it
spends so much effort in ensuring intellectual property rights: that is where it earns money.
IBM no longer makes computers. Amazon is a delivery company that also does IT. Microsoft
rents out its Office suite on an annual basis. Netflix streams films. Manufacturing is now
with China. China is integral to the global supply chain.
What happens when China also starts innovating? What happens when Huawei becomes a
market leader in 5G technology? What happens when the Chinese have more say in Africa
and the Asia-Pacific region? What happens when Chinese bullet trains carrying goods can
cross through central Asia and into Europe in a couple of days?
These are the frictions that underlay the mounting tensions between the US and China. It
isn’t simply the childish assertions of the US President that China robs the US of $500 billion
a year in trade (US exports to China had dropped to USD 106.6 billion in 2019 versus imports
of USD 452.2 billion). That part is nonsense. You buy goods and you pay for them. You get
goods in exchange for money. Where is the robbery? But it is unsustainable. And it is
supported by Chinese intervention to keep their currency weak with the dollars bought
going towards buying US debt. Currently China owns 16% of all US debt to foreign countries.
As we can see, the stage is set for conflict. Wars have started this way. World War 1
originated in the conflicting territorial ambitions of the European nations. Is it now likely
between the US and China? Will the coronavirus be the straw that breaks the diplomatic
camel’s back? The next article will take a look at the more immediate issues, place them in
context and consider the possible outcomes.