China, the United States, and the New Cold War: Competing Interests and Regional Dynamics

To explain his career, Robert Daly leans on a Chinese proverb: “If you have a good trick, you’ll always have enough to eat.” His trick was language. He learned Chinese during years as a United States diplomat. With it he served as an interpreter for Jimmy Carter, Jiang Zemin, and Henry Kissinger, produced the Chinese adaptation of Sesame Street, and taught at numerous universities. He now leads the Kissinger Institute on China and the United States at the Wilson Center in Washington. He spoke with a Catalan newspaper in Barcelona, invited by a regional American studies center to discuss the two powers contending for global leadership.

What are China’s strategic interests in the Middle East?

China’s engagement in the region is relatively new. It remains a major buyer of oil and has been mostly passive on other fronts. Yet it has forged unusually strong relationships with Iran, Saudi Arabia, Egypt, and Israel, all while maintaining a historic stance in support of the Palestinians. These ties are largely transactional: Beijing buys weapons and technology from Israel, while avoiding entanglement in Sunni–Shia rivalries.

Last year, China helped broker the renewal of relations between Iran and Saudi Arabia.

That achievement created a striking moment on the world stage. It painted China as a capable diplomat, but it did not require hard bargaining from its side; the deal served the interests of both sides. Since then, Beijing has deepened its regional involvement, though it has kept away from direct political leadership. Its growing influence helps Beijing extract concessions from the United States, and gradually the Middle East is becoming another arena where the U.S. and China compete.

Is it overtaking the United States?

Overall, the Middle East has not shifted toward China because Beijing does not appear ready to shoulder the burdens and costs of regional leadership. It shows little appetite for risk or for committing to long-term projects that could backfire. If one looks at its approach to Ukraine or the Middle East, it becomes clear that it lacks a concrete plan.

In Gaza, China’s involvement has been minimal, focused on calls for a ceasefire rather than mediation that changes the frame of the conflict.

China has long sided with the Palestinians. The current Chinese media narrative about the conflict highlights Western actions and portrays Washington as the main source of tension, rather than Beijing’s direct responsibility for the crisis.

The war in Ukraine has nudged China closer to Russia and, at the same time, brought Moscow and Tehran closer together. Geopolitical analysts warn that this three-way alignment could complicate the American objective of global hegemony in Eurasia. How concerned is Washington about this convergence?

Alarm exists across political spectrums in the United States, particularly on the right, but it is not universal. Some scholars warn against caricaturing Beijing and Tehran as pure antagonists, urging a focus on shared interests that bring them together. Iran supplies weapons to Russia and sells oil to China. Citing concerns about cyberspace sovereignty and “color revolutions,” several second-tier states such as North Korea and Venezuela, along with a growing number of developing nations, appear willing to back this bloc. A broader circle of regions—Asia Central, for example—feels tethered by geography to these powers. In some cases, smaller states like Laos and Cambodia rely heavily on China’s influence. The formation of competing blocs seems to be underway.

My assessment is that China is more inclined to coexist with the United States than to replace it.

That is a fair read. Washington wants to change China, but Beijing prefers to stay at peace with Washington and to keep its own course. While Beijing resents U.S. actions, Washington resents China’s rise. Beijing believes it should be allowed to chart its own path without being forced into a Western mold. That tension is at the heart of today’s dynamic.

Donald Trump pursued a heavily aggressive stance toward China, launching a trade and technology war. Has Joe Biden altered that approach?

The main alignment now is that both leaders view China as the foremost geostrategic challenge. The difference lies in alliances: Trump undermined many partners, while Biden has worked to rebuild and strengthen them. That contrast makes it more difficult for Beijing to predict American policy, and many observers think Beijing would welcome a return of Trump because Biden has been effective at reinforcing alliances in Europe and Asia. That represents a notable shift in the status quo.

Why is the United States so fixated on Taiwan, a small island off the China coast?

Historical reasons are clear, including U.S. support for Chiang Kai-shek during the civil war. The United States fought alongside Taiwan since 1941. Truman’s initial focus shifted after the Korean War and the era of the domino theory, which amplified Taiwan’s strategic importance as a base for operations in Korea. Over time, Taiwan transformed from a martial-era dictatorship into a dynamic democracy, strengthening ideological affinity with the United States, and Taiwan’s vibrant business and academic communities became influential in American institutions. Taiwan is also integral to America’s security network in Asia, alongside South Korea and Japan.

Isn’t the island also a military asset?

Americans have begun to discuss Taiwan in military terms. The traditional stance has been to avoid tying Beijing’s future to Taiwan’s fate, provided any changes are peaceful and supported by the Taiwanese. Under Biden, a high-ranking defense official suggested that Taiwan is a strategic asset for the United States. Since then, others have argued that if China absorbs Taiwan, it could use it as a launching point in the Pacific and threaten U.S. interests. That perspective represents a potentially destabilizing shift.

Several lawmakers have argued that the United States would defend Taiwan at any cost. Is that realistic? It is hard to say. Public opinion in the United States does not fully back such sacrifices. The government has not declared an essential national interest in Taiwan that would justify war. The scenario could hinge on how events unfold. A blockade without bloodshed might not escalate into full-scale war.

Some political scientists refer to the Tucídides Trap to describe the inevitability of conflict as rising powers challenge incumbents. Do you agree?

This is not inevitable, as a prominent analyst argued. He noted that in all historical examples involving nuclear powers, complete conflict did not occur. Neither the United States nor China desires war, but neither is willing to make concessions to avoid it. The current moment resembles a new cold war, with the real challenge being to keep it cold and manage the tensions without tipping into outright conflict. Citations: [Scholarly analysis on strategic rivalry and contemporary geopolitics].