Chinese leaders have finally realised that they are facing a new cold war. Over the past few months, Washington has put together a 'containment' package in Asia that includes a new military doctrine of air-sea battle, a new economic game changer in the Trans-Pacific Partnership, and the rotation of US marines in Australia. For years, mainstream Chinese analysts have refused to see this coming. Now, President Hu Jintao has publicly called on the navy to 'prepare for future military struggle'.
More interestingly, Vice-President and heir apparent Xi Jinping has begun to use different terminology. Instead of the vague language of 'building strategic trust', Xi acknowledges the perhaps irreconcilable differences between the two countries. The old official approach was to 'smooth over' differences, a delaying tactic; the new catchphrase is to 'control and manage' the differences.
This is no ordinary change of tone; it is a timely response to the dangerous policy pursued by the Americans. Gone are the days of strategic ambiguity on both sides, and the new leadership under Xi has set a realistic framework for future bilateral ties. The 'control and manage' approach may imply at least two things: first, the realisation that conflict with the US can no longer be avoided within the existing framework of engagement; second, the focus will shift towards maintaining a true strategic balance, however precarious, for the single purpose of avoiding a fully fledged confrontation.
There is little doubt that Washington is in the mood for a new cold war. Its China policy is on the cusp of an 'NSC-68 moment'. The 'National Security Council Report 68', issued shortly before the Korean war, was the key US government document that changed the direction of the cold war from Europe to Asia.
Americans love any concept that reflects a game-changing sentiment, such as the 'pivot towards Asia'. Will this development bode ill for today's most crucial bilateral relationship? At first glance, it certainly seems so. As neither side is using even veiled language to cover their clash in world views on regional and global governance, the stakes and solutions will become obvious. The US is building a military containment scheme in Asia, while the Chinese national interest will not be dictated by outsiders ganging up on China. The relationship could progressively worsen in a vicious cycle, as happened between the Soviet Union and the US during the early stages of the cold war.
But, ending strategic ambiguity has its merits, as the contours of Sino-US competition in the region will become more predictable. For example, Washington has a penchant for advertising new military weapons or doctrines to deter rivals. But this will lose its intended effect as it may automatically trigger an arms race on the Chinese side, and China could then justify its continued military modernisation.
In this way, Chinese military transparency - a key but until now unobtainable US objective - may be achieved by China's predictable countermeasures vis-a-vis the Pentagon. Beijing will have less need to avoid the publicity of its aircraft carriers and anti-ship weapons systems. In other words, China's strategic confidence will increase and its military policy will become more transparent.
