US-China Relations: Avoiding a New Cold War & the Path to Normalization

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The relationship between the United States and China has shifted from cautious engagement to tense rivalry, with each side now viewing the other as the primary threat to its core values, political legitimacy, and vital national interests. Experts say breaking this cycle will require coordinated steps across military, trade, and cultural domains, starting with confidence-building measures on Taiwan that can create a diplomatic foothold for broader normalization.

Why it matters

The deterioration of US-China relations has led to increased military deterrence, economic decoupling, and frayed cultural and diplomatic ties, raising the risk of miscalculation and conflict between the world's two largest economies. Rebuilding trust and finding common ground is crucial to avoiding a new Cold War and maintaining global stability.

The details

The US now frames China as the primary systemic challenger to its global leadership, technology, and democratic norms, while China sees the US as the central force trying to contain its rise. This has become embedded in military planning, alliance structures, export-control regimes, and public diplomacy, making even friendly summits hard to translate into lasting de-escalation. Economic interdependence is increasingly viewed as a vulnerability, leading to disruptions in supply chains and significant economic costs. Cultural and diplomatic ties have also frayed, with the number of Chinese students receiving US visas falling and visitor flows to Beijing dwindling.

• In April 2001, a collision between a Chinese fighter jet and a US EP-3 reconnaissance plane near Hainan Island could have escalated into nuclear war under today's heightened tensions.
• In May 1999, the accidental US bombing of the Chinese embassy in Belgrade could also have escalated into a broader conflict under current conditions.
• In October 2025, Xi Jinping and President Donald Trump met in Busan, South Korea, where Xi called the US a 'partner and friend' and announced China would resume buying US soybeans and cooperate on curbing illicit fentanyl trafficking.
• In December 2025, Trump announced that Nvidia could sell its second-most powerful semiconductor chips to China, rolling back some restrictions on advanced technology exports.

What they’re saying

What’s next

Reopening the US Consulate in Chengdu and the Chinese consulate in Houston, both closed in July 2020, would signal a willingness to rebuild people-to-people ties. Negotiating a reciprocal reduction in average tariff rates and easing export-control measures could also mitigate economic frictions. Improving academic exchanges, relaxing restrictions on journalists, and ending the practice of labeling each other's scholars as 'spies' would foster a more accurate mutual understanding.