The “New Normal” of China-US Relations: Trends and Enlightenment

Da Wei
From the “Bali Consensus” in 2022 to the “San Francisco Vision” in 2023, China-US relations finally show signs of stabilizing. If both sides can manage the relations well and with a stroke of luck, this trend may continue into 2024. If the new US administration in 2025 can carry on the current China strategy, the relatively stable dynamics may continue beyond 2025 and China-US relations may then gradually enter a new normal.

I. Uncomfortable coexistence

The emerging signs of the so-called new normal are supported by four common understandings that are emerging between China and the US.

First, China and the US have come to terms with the reality that  their relations will be predominantly negative for quite a long time to come. In the 35 years after the ice-breaking in 1972, China-US relations, despite ups and downs all along the way, have been by and large more positive than negative and more cooperative than competitive. In the past five years, the trend has turned to the opposite, in which negatives outweigh positives and competition outweighs cooperation. Like it or not, both sides have come to accept the reality that this is a structural change that will be hard to reverse in the foreseeable future.

Second, China and the US have come to the understanding that neither side wants a complete showdown that leads to full decoupling or even military conflict. In the past five years, there has been decoupling of varying degrees between China and the US in economic, technological and social spheres, for which both sides have paid a price. Now the mainstream view in both countries is that if China and the US slide into full decoupling, the costs will far outweigh the benefits. And military conflict, if there is any, is not in the interests of either side or anyone in the world. The Bali Consensus in November 2022 was a signal of stability sent by the Chinese and US presidents to the world. Three months later however, the unmanned airship incident occurred. In the months that followed, the two countries made efforts to pave the way for the two presidents to reach the “San Francisco Vision” in November 2023, once again sending a signal of stability, a fresh signal that is more credible than a year ago as it came after the two sides had overcome the difficulties.

Third, China and the US can only accept the reality that both countries are limited in strength and cannot fully achieve their strategic goals as they wish. The two countries come to realize the limits of their own strength and those of the other. For example, China does not want countries like the Netherlands to cooperate with the US in restricting China in chips, nor does it want the US-Japan and US-ROK alliances to become a trilateral one. Unfortunately, these things have happened. The US is stronger than China, but it is not able to do certain things on its own. For instance, it wants other countries to choose between the US and China and stand on the US side. But it has become apparent after several years that many countries refuse to take sides. Even the US allies in Europe do not see eye to eye with the US on everything. Similarly, the US cannot force all industrial chains to leave China or reshore to the US. In the competition between China and the US, as long as the two countries adopt proper strategies, a quick-win or quick-lose scenario by either side is unlikely.

Fourth, China and the US have also seen their own resilience at home after several years of intense competition. The past few years has been a tough time for both countries. Both were confronted with the severe challenges of the pandemic. China’s rise and change has triggered a strong sense of anxiety and crisis in the US. However, after several years of competition, the US finds its economic fundamentals are strong, and its innovation in science and technology represented by generative artificial intelligence is robust. In the face of the pressure from the US, the Chinese people, who have emerged from the pandemic, are confident about the huge potential of the Chinese economy, which will keep growing at a fairly fast speed for a long time to come. The suppression and restriction by the US has indeed exerted a considerable impact on China. On the other side, however, it has also spurred the Chinese market and delivered a fresh boost to research and development. 

The above four emerging understandings are the conceptual underpinnings of the new normal of China-US relations. The contacts at the working and higher levels between the two governments before and after the San Francisco Summit provide an institutional basis for this new normal. China-US relations will certainly not go back to the the old days, but will not necessarily decline indefinitely. Both countries feel somewhat “uncomfortable” in the current state of relations, but they have no other option but to live in peace.

Yet, it is difficult to say whether the new normal is sustainable. An unexpected crisis or a series of negative interactions may buck the trend, not to mention the enormous uncertainties that the 2024 US presidential election will bring to the US, the world and China-US relations. It is essential to keep a close eye on the developments, and China and the US need to make joint efforts to maintain the relative stability as it is now.

II. Maintaining a reasonable level of security

In 2023, the author visited the US several times to see firsthand what happened in the country. In China and other parts of the world, I also had many contacts with American officials and academics. From the face-to-face interactions and visits, I gained a stark impression: the China-US strategic competition has a significantly smaller impact on the US society than on the Chinese society. 

In the US, the China-US strategic rivalry and competition is mainly the talk in the strategic community and Washington. Even in these circles, most American officials and academics are still willing to engage Chinese scholars. From time to time, the policy community make reflections and criticisms on US policies. Outside these communities, domestic politics, economic and social policies, and science and innovation continue business as usual. People in the street show scanty interest in China and China-US relations. This may be explained by the gap in strength between the two countries. As the stronger party in the competition, the US has more strategic tools and resources at disposal. This is in contrast with the relatively bigger impact on the wider Chinese society, where there is a remarkably higher level of interest and input from all walks of life in China-US competition.  

This brings the question of the level of security. To put it in a more theoretical way, the bigger the impact of major-power strategic competition on a country’s development internally and externally, the higher the level of security. The international security theory holds that whether an issue falls in the security domain and fits into what level is determined not only by the nature of the issue per se, but also people’s perception. To use an analogy, it is up to flood control experts to determine what level of water in a river poses a security threat. If the warning water level is set too high, while no effective flood control measures are taken when water rises, it is inadequate security which will lead to serious consequences including floods. If the warning water level is set too low with the alarm set off when water rises only slightly, It is a state of over-security which will cause undue consumption of resources that are in limited supply. As the weaker party in China-US competition, China needs to be particularly vigilant against the risk of over-security.

In major power competition, an over-high level of security is likely to tilt the balance away from development and lead to an overemphasis on security, which will sap social vitality and stifle innovation. It goes without saying that security is the first need of human beings. Yet a country can only grow in the long run and win the competition with a vibrant society and thriving innovation. The history of major power competition in the 20th century shows that a major power may not be easily defeated, but might be gravely threatened by the domestic strategic shifts triggered by external pressure.

China-US competition in the past few years has revealed China’s own resilience and the limits of America’s strength. With stronger strategic confidence, China can accurately define a reasonable level of security. As affirmed by General Secretary Xi Jinping in the report delivered at the 20th National Congress of the Communist Party of China (CPC), high quality development remains the top priority in the drive to build a modern socialist country in all respects and development the primary task for the CPC in governing the country. It is true that China is under serious external pressure. In the final analysis, however, it is China itself, rather than external forces, that shapes China’s development prospects. As long as China develops in a steady manner, the US won’t achieve its goal through strategic suppression and competition.

An over-high level of security may also lead to an excessive focus on the US in China’s foreign relations. The US is the country that has the greatest influence on China. But the world is a diverse one, and the US is by no means equal to the world. As China-US relations will be dominated by negatives for a long time to come, the third parties are extremely important to China. The US should not be the deciding factor in China’s attitude toward and relations with third parties. China may not stand against anything the US supports, or support what the US opposes. At the same time, the independence of third parties should be fully respected and valued. One should never take it for granted that China can naturally manage its relations well with third parties when its relations with the US are in good shape.

III. China is not in strategic competition with the US

Since the end of 2017, the US administration has been calling its China strategy “strategic competition”. Chinese leaders have repeatedly stated that China does not agree to define China-US relations as strategic competition. President Xi Jinping reiterated this position again at the San Francisco Summit. Many people in the US cannot understand why China rejects the conceptual framework of “strategic competition”. In recent years, more and more people in China have made casual references to “China-US strategic competition”. In this connection, an important question needs to be answered: what do China and the US compete for?

Competition, regardless of its nature, always has a target. The US seeks to entrench its global hegemony by widening the gap with China. Therefore, the US strategy is indeed a strategic competition with China as the target. 

What is China’s strategic goal? In recent years, some people keep describing China-US competition as competition between the world’s No. 1 and No. 2 powers. The author believes that this view is erroneous. There is still a considerable development gap between China and the US. China’s external strategy is not to out-compete the US, but to ensure its own continued development. China’s strategic focus is not on the US, but on China itself. It doesn’t matter whether the US is doing well or not or the gap between China and the US is narrowing or widening. What is most important is that the great rejuvenation of the Chinese nation can continue and that China’s development momentum can not be interrupted. This is why President Xi Jinping keeps stressing that “the Pacific is wide enough” and “the earth is big enough” to accommodate both countries. In the competition with the US, China emphasizes that the US should not try to deprive China of its right to development.

After more than 40 years of hard work, China’s per capita GDP has reached nearly US$12,000, making China a medium-high-income country by the World Bank standard. China’s most important task is to increase the per capita GDP to US$20,000 and US$30,000, so as to jump over the middle-income trap. China’s goal is not to win a strategic competition with the US. Going forward, China’s economic size may surpass that of the US, but this is completely different from a race to grab the top seat. There are still 600 million people in China with a monthly income of about RMB1,000. China and the US compete at the micro level in specific industries and technologies, especially in artificial intelligence, chips, aircraft engines and other sector of vital importance to the country. In addition, the overarching goal of the Communist Party of China is to meet the people’s growing call for a better life. Daily necessities to a better life are as important as Cutting-edge high-tech.

In the years since its founding, the US rose to be the first major country in the West that developed a full-fledged democracy. The Soviet Union was the first to build a socialist country on its own. The rise of a big power often comes with the success of a mega experiment in human history. If China could materialize the blueprint drawn at the 20th CPC National Congress and become the first modern, high-income country with more than one billion population, this will be a remarkable accomplishment in human history and China’s influence and appeal will be on the rise globally.

The San Francisco Summit shows that China’s firm actions in the past few years arrested the fast deterioration of China-US relations which finally show signs of a new normal, though it is not certain whether the new normal is sustainable. We therefore must be on high alert. And the lessons of the past few years may guide our action for a long time to come.


Da Wei is Director of the Center for International Security and Strategy and Professor of Department of  International Relations, School of Social Science, Tsinghua University.

(Reprinted from The Paper, November 28, 2023)