US-China Strategic Competition Amidst the Paradox of Decoupling

Abstract

Propelled by its remarkable economic growth, China has emerged as a significant player in the global arena, challenging the traditional dominance of the United States. Leveraging its economic prowess, China has strategically advanced its interests not only in the Indo-Pacific context but also on a global scale. This strategy has prompted the United States, starting with the Trump administration, to transition from engagement to comprehensive containment, aiming to counter China's influence and uphold American leadership. This shift signifies a new era, resembling a modern-day Cold War, distinct from the previous engagement-oriented policies. Intriguingly, amidst the calls within Washington to decouple the US economy from that of China, trade and investment data hint at a nuanced revival of bilateral ties between these global superpowers, prompting a re-evaluation of conventional wisdom. Despite the strong rhetoric advocating decoupling, its tangible implementation remains uncertain. Economic indicators suggest a trend toward recoupling, underscoring the intricate interplay between strategic competition and economic interdependence. This complexity generates a paradoxical situation in the new Cold War era, in which intense strategic rivalry and crucial economic cooperation coexist.