As tensions with the US rise, China continues to reach out to the rest of the world

Mr Trump has imposed punitive measures against Chinese tech companies that he claims are a threat to US national security. REUTERS

The top priority for China today is the fate of its relations with the United States, but the Chinese leadership is nonetheless determined to build extensive commercial, military, strategic, and cultural ties with the wider world.

Last week, President Xi Jinping launched the Conference on Dialogue of Asian Civilisations – an event attended by the leaders of Asian and European nations, with the participation of think tanks from Asia, Europe, and Africa, in recognition of these continents’ important role in his flagship Belt and Road initiative.

The word "respect" came up a lot in the discussions of the Chinese officials, reflecting a growing Chinese nationalism in the face of US President Donald Trump's "America First" national security strategy.

Mr Trump has awoken this nationalism with his measures against China, which are part of a policy that enjoys broad support in the US. Mr Trump has also imposed punitive measures against Chinese tech companies that he claims are a threat to US national security.

However, realism and pragmatism have forced the Chinese leadership to continue to seek accord with the US leadership.

In the Middle East, China forged strong cultural and trade links with Saudi Arabia and the UAE, maintained strategic ties with Iran, pursued advanced relations with Israel, entrusted Syria to Russia, and launched projects in Jordan and Lebanon. It is also keeping a close watch on the Straits of Hormuz and Bab El Mandeb, which are key to its oil imports, and is expanding its presence in Africa.

Another important relationship for China is with Russia, the source of advanced arms imports. Russia is also a useful ally in the context of shared “hostility” to western ideology, not to mention the shared Communist background of the two powers. One important difference is that while the Soviet Union was the counter-pole to the US in the Cold War, today China is at pains to show that it is not another USSR.

The main conclusion of the discussions at the conference held by the Chinese Academy of Social Sciences (CASS), is that China sees Asia as the source of immense human, cultural, economic, historical, political and natural wealth. China’s leadership in Asia means its hand in the negotiations with the US is strengthened by a third of the world’s surface area, 4.5 billion people, and a number of strategic friendships with leading world states.

President Xi’s initiative is carefully planned, and seeks not only dialogue between Asians, but also to address America with one Asian voice. According to CASS Chairman Xie Fuzhan, Asia and its dynamic economy have entered a new era, where everyone must “respect the other” and where “arrogance is a great obstacle” to understanding.

The conversations on the sidelines of the conference, attended by the Beirut Institute, focused on US-Chinese relations and the fate of negotiations between the two countries' leaders. The first conclusion was that China did not want the rivalry to evolve into a confrontation with the US, as most Chinese want co-operation and to avoid a stand-off. The second is that US sanctions have made the future of the relationship with China ambiguous. The third conclusion is that the Trump doctrine detailed in the National Security Strategy has concerned and angered China, but that China currently has no strategy for confrontation.

“We do not believe that our interest is served by turning the idea of US-Chinese confrontation into a reality,” said one Chinese expert. "China is doing its utmost to avoid confrontation through continued co-operation”.

However, China could soon find itself “forced to adjust to reality”, albeit for the time being.

China believes US global dominance is enabled by the global security network it has established. But China is telling the countries it is wooing that it is best to work together to avoid worst-case scenarios.

China is asking Europe how, in the event that the rivalry with the US evolves into hostility, it would handle that challenge. In the meantime, the Chinese leadership is seeking stronger relations with the European powers, and to capitalise on the tensions between them and the Trump administration.

The leadership claims it has no expansionist plans in its neighbourhood, despite its border disputes with five of its neighbours, including India and Japan. The Chinese leaders also defend China’s actions in the South China Sea and the South Pacific region. They say that mutual Chinese-Indian interests require co-operation, because each of these two nations has to secure one million new jobs each month, while technological investment prospects in both countries are wide open. Regarding border disputes, the experts in China admit they are a source of some distrust between the two countries.

The Chinese experts and officials surmise that in parallel with China’s improved relations with India and Japan in recent years, the Chinese-American dynamic has undermined China’s security environment. The Chinese leadership is fully aware of the implications of the standoff with the US on relations with neighbours that have strong relations with Washington. For this reason, China is working hard to reinforce bilateral relations with them.

In the Middle East, China imports oil from both Iran and Saudi Arabia. Since the early 1990s, China has sought “balanced” relations in the context of the Arab-Israeli conflict, according to one Chinese expert, with China’s trade with Israel increasing dramatically in recent years. China is Saudi Arabia’s top trade partner as well, as part of a policy pursued by both countries carefully choreographed against their respective relations with the US. Riyadh is aware of the delicate balance of its relations with the US, and is strengthening ties with China.

China is also the UAE’s top trade partner, and the UAE is assigning great importance to the Emirates’ role in the Belt and Road initiative. Abu Dhabi has appointed one of its top officials, Khaldoon Al Mubarak, as special envoy to China. China is also practically a fourth partner to the strategic partnership between Saudi Arabia, the UAE, and Egypt, and is developing major projects in Egypt.

Nevertheless, Iran remains vital for China as a source of oil imports and as an ally against the US. Iran is also strategically placed for the Belt and Road project and would be a major strategic asset in a confrontation.

In October, China will celebrate the 70th anniversary of the founding of the People’s Republic. It will present itself as a success story, as a modern state with a solid vision all the way to 2050. But if China and the US fail to reach a deal, China’s problems will expand, its export-driven economy will suffer, and it will lose a major market in the US. China can indeed retaliate, for example by dumping US treasury bonds, but experts say such a move would be extremely risky for China and the world economy, because it could trigger a global economic crisis and threaten the Belt and Road initiative.

China is trying to confront US measures and sanctions against its giant companies, but it is hitting obstacles. China cannot accurately read Mr Trump’s policies and it knows time is not on its side. For this reason, the upcoming meeting between Mr Trump and President Xi at the G20 summit could be the final duel.

The Chinese leadership knows that failing to reach an agreement hurts its interests, although some in its ranks believe that stoking nationalism could provide it with a necessary cover if a deal falls through. What’s also dangerous is that a military confrontation is not completely out of the question. In such a scenario, many of China’s priorities would collapse, US-Chinese relations would grind to a halt, China would blame the US and could focus its energy on toppling Mr Trump in the next presidential election.