China's Increased Global Role and the Impact on the US

China's increased global role and influence pose a variety of diplomatic, economic and security challenges for the United States, but all of which are negative.

China's interaction with regional organizations around the world will complicate US regional diplomacy and makes it harder for the US to engage regional organizations in support of American objectives. Chinese leaders appear to be conscious of US sensitivities about Chinese involvement in the Middle East and Latin America, and this is likely to restrain their diplomatic initiatives in these regions.

"China will find it easier to increase its influence in regions or countries that are not top priorities for the United States (such as sub-Saharan Africa). This may set up a competitive dynamic where the United States feels pressure to increase the attention and resources it devotes to countries and regions that would otherwise be considered low priority," wrote Phillips S. Saunder in China's Global Activism: Strategy, Drivers and Tools (Institute for National Strategic Studies, National Defense University Press, Washington DC, October 2006.)

In the case of Asia, China's increasing influence could conflict with important US interests. But as Saunders pointed out, the US has considerable hard and soft power resources, and is "well-positioned to compete effectively with China if necessary."

As for China's increased influence in international organizations, Saunders predict that this is likely to complicate US efforts in pursuing a global agenda that includes democracy, human rights, and labor issues. This dynamic is already apparent in Burma, where both China and India had been dealing with the junta without raising human rights issues.

Turning to the short-term willingness of Chinese firms in securing access to energy and other natural resources at prices that are not commercially viable, Saunders noted that this may make it difficult for US firms to compete, especially given the opaque corporate structure of Chinese national oil companies and their likely access to state-subsidized loans.

To tackle such competition, the US could engage China in discussions about international rules for state financing and support for investment in energy resources. But like other late entrants into the international energy game, Beijing will be reluctant to give up these "perks." But efforts to engage the Chinese central and local governments on improving energy efficiency are expected to be more successful, and may also provide commercial opportunities for US companies.

Saunders' conclusion was that China's increased influence needs to be kept in perspective. Chinese military power projection capability remains limited. Chinese businesses are taking their first steps in efforts to become global multinationals. And even though China is an export powerhouse, 60 per cent of its exports are produced by foreign invested firms. China's global influence is increasing, but China still operates within the framework of global institutions established by the United States.

"Former Deputy Secretary of State Robert Zoellick was correct when he argued that China has been a major beneficiary of the existing international system over the last 25 years and that it needs to take more responsibility for sustaining this system. The United States should look for opportunities to influence Chinese definitions of global interests and attitudes toward international norms in positive directions ... the relationship is not a zero-sum competition ... engagement and dialogue are critical aspects of US efforts to turn China into a responsible stakeholder that will play a positive global role."