We are heading for Cold War Two. Some say we are in it. Either way, it will touch every corner of the globe—as did its predecessor— as the main protagonists’ battle against each other for the hearts, minds, military assets, trade deals, access to resources, political influence and strategic positioning of third countries.
Cold War I was the US v. the Soviet Union. Post- World War Two Europe was the initial cockpit and Western Europe were America’s junior partners. China was the Soviets subordinate for several key years, but the inflated national egos of the two countries and their joint occupancy of the Eurasian land mass led to the inevitable falling out.
Cold War II is different. The focus is now Asia where communist China threatens to replace America as the hegemonic power. Russia is now China’s junior partner and has dropped several places on Washington’s worry list. It is economically stunted but remains a belligerent military giant, which means it should be of greater concern than currently rated by Washington.
The biggest difference between Cold Wars One and Two is that China has succeeded economically far beyond the dreams of the old Soviet Union. This has enabled Beijing to use soft trade power while accumulating cash to build hard military muscle and buy allies around the world.
With a few exceptions, Beijing is not having much luck winning support in Asia. After all, that is the region that they seek to dominate as the Soviet Union sought dominance in Europe. Japan, India, South Korea, Singapore, Vietnam and Australia are all solidly in the American camp. Their only real regional allies are pariah-like North Korea and Russia.
But elsewhere in the world they have gained friends and influence through a combination of investment, trade, loans, grants and infrastructure development. Africa’s abundant natural resources have been successfully targeted with some $60 billion of investment compared to $16 billion from the US.
In Latin America, the Chinese have stood alongside the Russians in backing Venezuela’s Nicolas Maduro, a move which has helped keep Trump from intervening in the troubled South American oil giant. In Cuba, Beijing, has replaced the old Soviet Union as the island’s main economic support. Beijing took the unusual step of writing off a $6 billion debt and is now Havana’s biggest trading partner.
The rest of the Western Hemisphere is in the American camp. But Europe is being lured by Chinese cash and cheap manufactured goods. It is not as compliant as Washington expects or would like. The Greeks have sold Beijing a 51 percent stake in the strategic of Piraeus, thus giving the China’s Belt/Road Initiative a foothold in the Mediterranean. In 2019 the Chinese market was worth about $200 billion a year to the EU. Germany’s Chancellor Angela Merkel has led the way in forging closer links with Beijing, visiting China 12 times in the past 14 years.
The German interest in improved relations with China has been given a push by the erratic behaviour of President Trump—especially his assertions that Germany is ripping-off American taxpayers. Threats about continued support for NATO; support for Brexit, tariffs on German goods and the withdrawal of 12,000 US troops have combined to encourage a German re-think.
However, the problem of China’s junior partner—the looming Russian bear—plus long-standing NATO links makes it likely that Germany, and the rest of Europe will fall into the American camp, albeit with some hesitation and reservations. To that end, Britain’s decision to scrap its deal with Huawei and reassess its links with China were a win for Washington. The fact is that if the US failed to add the UK to its Sino phobic team then it had little hope of persuading others to come onside.
Many people blame the Trump Administration for the current precarious state of Sino-American relations. They look forward to a Biden administration easing tensions. The fact is that relations between Beijing and Washington were souring long before Donald Trump entered the White House. He has exacerbated them with his tariffs and rhetoric, but just about the only bipartisan area of agreement in Washington these days is on China. Don’t expect a big change with Biden. Do expect the face-off to continue.
Tom Arms is a regular contributor