Xi Jinping feeling the heat from new Cold War with US

How Xi Jinping plans to respond to Donald Trump — and where that leads to — is far from clear.

Xi Jinping and Donald Trump in Beijing last November. Picture: AFP

As Donald Trump steps up his attacks on China, it is becoming increasingly clear that Beijing is scrambling to work out how to cope with an unpredictable but very determined US President.

Trump’s clear strategy to depict China as public enemy No 1 on trade and now the military side, with the prospect of increasing patrols by Western nations in the South China Sea, is throwing up serious challenges for China.

While China’s Foreign Ministry meticulously responds to every US comment, and its ambassadors express their government’s unhappiness with every slight and perceived slight in their local media, it is unclear how President Xi Jinping plans to deal with a new Cold War from Washington.

Officials repeatedly complain about Cold War rhetoric, but it is becoming increasingly clear Trump doesn’t care what they say and is willing to draw allies including Australia into his South China Sea campaign.

Years of frustration with China’s effective coercion of foreign investors’ intellectual property and its unchallenged island building are being countered by an angry opponent who does not play by any conventional rules.

It is becoming clear in Beijing the trade war will need to be resolved by far more than the customary negotiation between officials to deliver minor concessions and promises to do better.

Last week’s speech by Vice-President Mike Pence — which attacked China on trade, free speech, human rights and espionage — was a mini-declaration of war.

“Mike Pence’s speech laid down an official marker for a much more contentious new era of US-China relations,” US China watcher Bill Bishop said in his newsletter Sinocism.

Chris Johnson, former CIA analyst at the Centre for Strategic and International Studies, said there was a “pronounced groundshift in Washington about how China is viewed”. “The gears are starting to lock into place in both leadership’s minds that this is an implacable enemy, a global struggle for influence and maybe domination,” he said.

China dutifully responded to Pence’s comments, point by point, saying the accusations were groundless, that it did not interfere in people’s internal affairs and had “indisputable authority” over the South China Sea. Their conclusion is inevitably the same: China hopes the US will come to its senses. But it is becoming increasingly clear that it not going to happen and that we are moving into a new period of global tensions between the world’s largest economies.

At the same time Bloomberg reported claims the People’s Liberation Army had put microchips in motherboards sent to US companies that would allow the PLA back-door access. It was denied by Apple and Amazon, but the story is adding to what is now a new Cold War atmosphere coming from the US.

Former Australian ambassador to China Geoff Raby told Bloomberg last week that Beijing had “very much” underestimated Trump and his capacity to hold a hard line and build a strong domestic constituency. There was “a lot of soul-searching going on” and rumours Xi had overreached, misreading Trump and mishandling the China-US relationship.

The optimists see Trump as just posturing ahead of mid-term elections on November 6, with relations between Trump and Xi to be patched up on the sidelines of the G20 summit in Argentina late next month. Yet there is a growing feeling that things are a lot more serious than that. How Xi plans to respond to Trump — and where that leads to — is far from clear.