In the epoch of globalization, interdependency between states is at its crowning position. The rhetoric of the cold war is yet again being heard, but this time players are different. Now, the competition is between the United States and China. The term cold war was first used by Bernard Baruch and then by Walter Lippmann in his New York Herald Tribune column.

During the 1990s, there was a confrontation between the poles over differing ideologies, i.e. capitalism Vs communism. This resulted in the breakdown of the former USSR, shaping into a new world order led by the United States as a sole superpower. Proponents of hegemonic stability theory claim that unipolar world order is essential for maintaining peace. As, when a competitor arises, it tends to give a setback to the supremacy of existing power leading towards confrontation and the best example to quote here is the “Peloponnesian War” between Athens and Sparta.

In the 21st century, the rise of China especially in terms of the economy has resulted in a competition between the status quo-US and revisionist China.

As per the opinion of many analysts, though there is no confrontation between the two powers, it might be just a constructed idea linked with the conception of the “Thucydides trap”. On the contrary, indicators of the cold war like geo-economics, geo-strategic, and geopolitics portray another picture that both of the states are at daggers drawn. USA and China are economically, militarily, and diplomatically involved in different regions. The enmity between the two could lead to the creation of Blocism, i.e. USA capitalism Vs. China’s-socialism. Economic indicator-trade friction has already started between the USA and China when Chinese trade value goods were in surplus and the USA goods were in deficit.

Resultantly, protectionist policies-tariffs were levied on China in 2018 by 25 percent. Similarly, the USA banned certain Chinese products and likewise in retaliation, the Chinese banned the merchandise coming from the USA. Both had suspended the respective consulates operational inside their jurisdiction. A major apprehension, raised by the USA, was that Chinese mobile companies like Huawei 5G microphones were involved in stealing data from people’s phones and blamed China to be involved in intellectual property theft. As an outcome, the USA banned Huawei and China banned Apple products. Due to the imposition of tariffs among the states, a price hike was seen, which affected US consumers.

The IMF warned that the intensifying USA-China trade war will “jeopardize” global growth. Competition could also bring challenges to the economies of smaller states in the different regions, which are reliant upon them. Lately, there has been a surge in the geostrategic alliances, i.e. QUAD, AUKUS, COMCASA, LEMEOA, BECA, and B3W from the US side and BRI and CPEC from the Chinese side. Analysts believe that these projects are to stay and curtail each other’s influence physically through offshore balancing.

These conflicts can lead to political polarization in the states, which are under the influence of either the USA or China, and can obstruct the developmental projects in those states.

China claims that the USA is involved in doing different armed-equipped deals, like in AUKUS, in which the USA will provide nuclear-powered submarines to Australia and MQ-9B drones to India under QUAD to do surveillance against China, bringing repercussions for regional security and nuclear proliferation. The issue of the blame game is at its utmost position, when USA ex-President Trump called COVID-19 to be the Chinese virus, and in retaliation, China termed it to be an American military virus. Correspondingly, on global issues, both of the states differ in their opinion like in the case of Russia-Ukraine, China-Taiwan, and climate change.

The USA blames China to be an influencer in different regions by giving loans in case of BRI and terming these projects as a debt trap and currency manipulator. Differences of opinion and forming alliances with the opponents to counter each other could further mar an already fragile conflict resolution regime in the world. For example, the issues of Kashmir, Palestine, Afghanistan, the Middle East, and Central Asia require the support of both the USA and China to be resolved.

In Asia-Pacific, there are several territorial and maritime disputes among China, Japan, Vietnam, and the Philippines over the Senkaku, Parcel, Spartley, and Scarborough Islands. These Islands hold importance due to the presence of mineral resources in the sea bed. China’s conflict with Japan over Senkaku Island, upon which the USA and China, hold divergent positions. In Asia–Pacific, the USA is doing bilateral defense treaties over the disputed islands upon which China claims its sovereignty.

These actions could further accelerate the maritime disputes in the region, creating hindrances in the integration of the region with other great powers. Platforms of integration such as ASEAN and SCO have also become vulnerable as the USA is not a member of these organizations. So, there is a possibility that any decision taken independently without taking into consideration of the USA’s interests will result in negative consequences.

In an era of a liberal economy, this conflict could disturb the liberal world economic order by creating implications for regions and states. Conclusively, “Talk is cheap. Actions are what matter… I hope that both sides come to the table and action follows words.” – Todd Rokita, member of the United States House of Representatives.