Beginning in 2009, the Obama administration failed to notice that Russia and China were playing their own version of the three-party game with the U.S. as the odd-man-out. Russian-Chinese cooperation expanded in initiatives such as the Shanghai Cooperation Organisation, the BRICS institutions, the New Silk Road initiative, and bilateral deals on currency swaps, oil and natural gas, pipeline infrastructure, and arms sales. (You can get an in depth analysis of the Russian angle in Nomi’s article.)
The U.S. was the new loser in the three-party game.
Russia and the U.S. are the two largest energy producers in the world. With cooperation from Saudi Arabia, they can dictate the global price of energy. The appointment of Rex Tillerson, former CEO of ExxonMobil, as Trump’s Secretary of State puts the use of the energy weapon in deft hands. China will be pressured for cooperation on issues such as the South China Sea, North Korea’s nuclear program, and Taiwan relations.
As is the case regarding concessions on trade and the currency, China is being asked to make concessions it cannot give. Beijing regards Taiwan as an integral part of China, a temporary “breakaway province,” not a separate political entity. China’s position on Taiwan is existential and non-negotiable.
China likewise has little room for concessions on its claim of near-complete control of the South China Sea. That arm of the Pacific Ocean is rich in fish that China needs to feed its people. China is unwilling to share the catch with Vietnam and the Philippines. Numerous boardings, collisions, and seizures have happened already. A greater armed confrontation there is just a matter of time.
Given a revival of the Russian-U.S. condominium of power on friendly terms, and China’s inability to deliver concessions demanded by Trump, the prospect for U.S.-China geopolitical relations is poor.
This will only worsen the already deteriorating economic relations between the two largest economies in the world.