The world still has not managed to come out of the bad nostalgia of the Soviet Union-US cold war yet we are likely to witness another between the US and China. Both the economic giants are being entangled at various fronts be it economic or military. However, there are wide-ranging trepidations as per the experts on both sides that this cold war will result in an economic apocalypse.
Thomas J. Christensen, a professor at Columbia University stated that in Foreign Affairs that there will not be a new cold war as it lacks three fundamental and interrelated elements that defined the US-Soviet Union rift: 1. Both the US and China are not engaged in an ideological struggle to win the minds and hearts of third parties; 2. Both the countries are not leading alliances to foster proxy wars; 3. Containment will not work as the world is more integrated than before.
The recent G7 meeting at Cornwall, UK witnessed a change in their agenda. The meeting has answered some of the averments adduced by Thomas J. Christensen. The discussion that took place at the meet-up was quite unconventional as there was less emphasis on economic development, climate change mitigation, trade boosting, tackling COVID-19, and so on. The focus was to stop China from becoming a global power. The US is all set for forging an alliance for tackling China. However, few G7 members expressed dissent upon confrontation with China as they are economically interdependent. The group of industrialized countries pledged to raise $40tr to tackle Chinese BRI with B3W. A crucial question is: how will they accumulate such a huge sum?
The Quad virtual meeting held in March was also one of the containing China policy followed by the US and the first ever since the Biden clinched office. The leaders of the four countries; the US, Australia, Japan, and India are working hand in glove to confront the “China challenge” as America subtly criticized CPEC, which is Pakistan’s landmark venture with China. The injection of support to India in the region by the US is the gross epitome of American consideration of Chinese economic ballooning. While experts termed the skirmish between India and China in the region of Ladakh a Chinese response to the US maneuvering.
Terming Chinese rise as a threat to global security was answered noticeably by China “gone are the days when global affairs were decided by a handful of countries. China will not tolerate any attack on its sovereignty.” The diatribe by the two giants will bring something devastative as this cold war – if started – will be totally different from the Soviet Union-US cold war.
The experts are expressing deep concerns as unlike the Soviet Union-US cold war, the US and China are economically interdependent. Many Western and European countries are dependent on Chinese raw materials and if the Chinese economy collapses, the world will feel shockwaves of economic destruction. For example, in 2019, Chinese imports from Germany alone were worth 96bn euros which is half of Germany’s exports in entire Europe.
Latin American countries even deem China as their biggest trading partner despite America being in their vicinity. For instance, 16 of 20 countries have joined BRI. In the past, Brazil was the major trading partner of Argentine but now, it is China.
BRI is almost a half ahead of what is not even started. As per the BBC report, China will overtake America by 2028 much earlier than postulated before. The Chinese contribution to the world GDP was 3.6pc in 2000 as compare to 17.8pc today. From the past decade, China was solely focused on its economic development rather than engaging in any war – like the US – which helped China manifold.