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Analyzing Xi Jinping's "Chinese Dream" policy on the US-China power

competition in international trade.
CHAPTER 2: China's policies and strategies affect America's power.
2.1 History of research

Many international scholars agree with Professor Graham Allison, Director of the Belfer
Center for Science and International Affairs at Harvard University's Kennedy School, that
China's rapid rise is challenging the dominant position of the United States, causing the
two countries to fall into the Thucydides Trap.

"Trap" means a difficult situation to escape; Thucydides was a Greek historian."The

Thucydides Trap" is a concept that implies war is a natural tendency when a rising power
threatens to replace an existing power. The "Thucydides Trap" is named after the ancient
Greek historian Thucydides, who made observations about the Peloponnesian War
between the rising power of Athens and the established power of Sparta.

The strategic competition between the U.S. and China began after the Cold War ended
and started to take shape during the 2008 economic crisis. Competition accelerated at the
end of the Obama era and peaked at the beginning of President Trump's term.The US-
China trade war officially broke out on March 22, 2018, when US President Donald
Trump announced a $50 billion tariff on Chinese goods exported to the US, to prevent
what they deemed unfair trade practices and intellectual property theft.

In recent years, many senior U.S. officials have emphasized that the China-U.S.
relationship is a "complex and broad" one. Chinese leaders also always believe that there
are many differences between China and the United States, but there are also many
common points. It is necessary to view and handle Sino-U.S. relations from a strategic
and global perspective.

In fact, the "dominant" position of the United States in recent times has been challenged
due to China's rapid reform, opening up, and integration into the regional and global
economy and politics; the relative power of the United States and the West is being
assessed by many experts as declining. Based on the analysis of economic data from the
period 1983-2023, the average GDP growth rates of major countries during this period
are as follows: China: 9.78% per year, the United States: 2.8% per year; the United
Kingdom: 2.33% per year, France: 1.99% per year, Germany: 1.88% per year, Japan:
1.52% per year, the European Union (EU): 2.27% per year. Thus, over the past 40 years,
compared to the powers in the Group of Seven (G-7) advanced industrial nations, China
has had an average annual growth rate 3.5 to 5.2 times higher.Thanks to the consistently
high growth rate over the past four decades, China's per capita GDP increased from 347
USD (in 1990) to 12,970 USD (in 2022), a 37.4-fold increase, while the increases for the
US, UK, France, and Germany were 3.2; 2.4; 2.3; and 1.9 times respectively (this means
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that in 32 years, China has narrowed the gap with the US and the G-7 countries from
11.68 times to over 20 times). In terms of national scale, in 1990, China's economy was
only 1/16 the size of the US economy and 1/16 the size of the EU economy; by 2021,
China officially surpassed the EU and is expected to surpass the US by 2030.The rise of
China has raised fears that American power will be shaken.
2.2 China's science and technology policy-strategy
2.2.1 Made in China ( MIC2025)
In recent years, under the leadership of the General Secretary of the Communist Party of
China, President of the People's Republic of China - Xi Jinping, China has risen to
become a global influential power. The economy of this country has risen to the second
position in the world and threatens the number one position of the United States.The term
"Made in China" is a well-known phrase used to describe countless items produced in
China. MIC25 is being implemented with the vision and goal of transforming China into
a leading global manufacturing superpower.
The term "Made in China 2025" (MIC25) was introduced by the late Prime Minister Li
Keqiang in the 2015 government work report. Specifically, in May 2015, the State
Council of China announced MIC25 as a national initiative from 2015 to 2025, laying an
important foundation for greater ambitions by the timelines of 2035 and 2049. MIC25 is
China's ambitious plan, which is expected to last for 10 years, aiming to rapidly develop
10 high-tech industrial sectors in China with the goal of becoming a "manufacturing
superpower" by 2049, marking the 100th anniversary of the founding of the People's
Republic of China. (1949-2049). This overall plan is divided into 3 phases, including:
From 2015-2025: China enters the group of advanced manufacturing and
production countries.
From 2026-2035: Presence in developed industrial countries.
From 2036-2049: Becoming the world's number one manufacturing power.
It can be seen that MIC25 is a strategy to lay the foundation for further ambitions – on the
occasion of the second centenary of this billion-strong nation, while also laying a solid
foundation to realize the Chinese Dream of the great rejuvenation of the Chinese nation.
Other key sectors include: agricultural technology; aerospace engineering; new
composite materials; advanced electrical equipment; emerging biomedical industry; high-
end railway infrastructure; and high-tech maritime engineering... The "Made in China
2025" plan sets the goal that by 2025, China will achieve 70% "self-sufficiency" in high-
tech industries; by 2049, it will "dominate" the global market.
When it comes to artificial intelligence, President Xi has called for the promotion of the
development of a new generation of AI to enable China to take the initiative in the global
competition for science and technology. He requires Chinese businesses and managers to
dominate the heights of "key and core technologies," including: basic technologies,
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commonly used technologies; asymmetric technologies, or "trump card" technologies,

and advanced technologies, or breakthrough technologies.
"Made in China 2025" was introduced in the context of China's economy experiencing
significant fluctuations, aiming towards the following goals:
Restoring growth momentum in the context of China's economy landing softly: In recent
years, China's economy has been slowing down, and capturing emerging industries and
technologies is considered a key means to maintain and improve growth. The pursuit of
scientific advancements in the era of the Fourth Industrial Revolution is considered a
matter of vital importance by Chinese leaders, ensuring the restoration of growth rates in
the new situation.
Chasing and surpassing other countries: In a world where technology and innovation
have become global issues, China has sought "self-sufficiency" to achieve independence
and autonomy in core technologies across a range of prioritized industries. Subtly but
clearly, China's goal of becoming a manufacturing superpower shows an ambition not
merely to catch up with other advanced economies but to surpass and replace them to
achieve dominance in these industries worldwide.
Becoming a superpower in science and technology: The current moment is considered a
historic opportunity for China, where there is a convergence of a new scientific and
technological revolution and the transformation of the country's economic development
model. Of course, the ultimate goal of this plan is for China to become "world-class" as a
superpower in science and technology by 2049.
Revealing ambitions to compete for global leadership with the US: In the current period,
the US and China are two major countries, and the US-China relationship has become the
main axis shaping the relationships and order of the 21st century world.With a coastline
stretching over 18,000 km, in recent years, China has made significant investments to
transform the country into a dominant maritime power in the region, gradually nurturing
ambitions to become a global maritime superpower. The modernization of the navy, the
refurbishment and commissioning of the Liaoning aircraft carrier, the construction of new
aircraft carriers, and the efforts to seize many important ports around the world are
evidence of this ambition.After four decades of rapid growth, China has risen to become
the world's second-largest economy and is full of hope to become the largest global
economy in the coming decades. China has abandoned the strategy of "Hiding and biding
time, peaceful rise" proposed by Chinese leader Deng Xiaoping 40 years ago to reveal
and assert itself through the "Chinese Dream." With the "Belt and Road" strategy, China
hopes to become the center with two outstretched arms of the "Silk Road" and the "21st
Century Maritime Silk Road" in order to "embrace" the world. If we put it on the
"scales," it is easy to see that if China leads the world in manufacturing and technology,
especially in key sectors, the U.S. will find it difficult to maintain its position as the sole
superpower in a unipolar world. It is precisely that which has made the US and its allies
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"startled" by China's rise in many aspects.

Since the outbreak of the trade war (July 6, 2018), the impact of the U.S. trade war on the
Chinese economy has become increasingly profound and evident. Among them, there are
several industries prioritized in the "Made in China 2025" plan. Besides the goal of
reducing the trade deficit, both the previous administration of D. Trump and the current
administration of J. Biden are focused on preventing the rise of China as a strategic
competitor.
The US-China trade war that erupted during President Donald Trump's administration has
had certain impacts on the results of MIC25. After Donald Trump took office, in pursuit
of the goal "America First," he took a hardline stance on trade with China, viewing it as
America's top competitor in terms of economy and technology.First, the trade barriers
imposed by Donald Trump, including higher tariffs on Chinese goods and banning major
Chinese tech companies like Huawei, have negatively impacted the country's export
progress, including high-tech products being promoted under MIC25. This slows down
the global market share growth rate for the priority industries of MIC25.Trump's demand
for American companies to leave China or ban the use of certain Chinese technologies
also poses difficulties for MIC25's goals of technology transfer and innovation. At the
same time, the trade war forces China to focus on dealing with trade pressures, diverting
its research and technology development activities when implementing MIC25.The US-
China tensions have made China more determined to accelerate the localization of key
technologies, reducing dependence on technology imports from abroad, especially from
the US. Trump's sanctions on some Chinese tech companies have also prompted Beijing
to strive to develop alternative sectors such as semiconductor materials and components.
To achieve the ultimate goal of becoming a leading technology manufacturing
powerhouse, Beijing will make further efforts to implement MIC25 despite pressure from
the United States, Europe, or other economies.
2.2.2 Belt and Road Initiative (BRI)
The "Belt and Road Initiative" (BRI) initiated by China has gone through a 10-year
journey (2013 - 2023) and achieved significant results, laying an important foundation for
implementing more effective directions in the next phase. BRI has clearly demonstrated
its ability to connect countries and continents through cooperation content that is
relatively aligned with the development needs of each country during their participation
in BRI. BRI embodies the ambition to revive the Silk Road, the ancient route connecting
China to the Mediterranean region across the Eurasian continent. The goal of the BRI is
to enhance China's connectivity with the world, covering a vast geographical area with
both old and new projects. The international financial group Morgan Stanley forecasts
that the total funding China pours into BRI projects could reach 1.2-1.3 trillion USD by
2027.
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BRI adheres to the principles of cooperative consultation, joint construction, and shared
benefits, characterized by distinct equality, openness, and inclusiveness. Compared to the
Indo-Pacific infrastructure initiative led by the United States and its allies, China's BRI
initiative has the advantage of being implemented first.
The competition for infrastructure investment between China and the United States
involves a debate over the investment aid model. Asian researcher at the Heritage
Foundation (USA), Jeff Smith, noted that the investment aid models between China and
the USA are completely different. China focuses on state-owned enterprise infrastructure
projects.
These projects sometimes turn out to be economically ineffective and cause some
countries to bear debt. China often monopolizes the benefits of projects, as evidenced by
Chinese banks profiting from loans, with these projects being carried out by Chinese
companies and workers. Many experts believe that China seems to be relying on the BRI
strategy to build its own rule system.
U.S. investment aid focuses on the private sector to drive economic growth while
maintaining standards such as sustainability, high standards, and transparency in
economic development. The U.S. government usually only provides non-refundable aid
in areas such as land clearance, cultural preservation, healthcare, agricultural support, and
law enforcement training.
Conservative forces in the U.S. tend to interpret the "Belt and Road Initiative" as a
geopolitical tool, even considering it a strategic threat to the U.S. Former U.S. National
Security Advisor John Bolton stated that China's purpose in proposing the BRI
cooperation initiative is to build numerous trade routes both within China and abroad,
with the ultimate goal of enhancing Beijing's dominant position in the world.White
House advisor Peter Navarro and U.S. Secretary of State Mike Pompeo have warned
African and Latin American countries about the risks of exploitative economic activities
and China's influence. According to the United States' perspective, the geostrategic
challenge posed by the BRI to the U.S. is primarily manifested in the following areas:
First, it is the issue of militarization. Along with the continuous promotion of BRI
construction, China's overseas interests are rapidly increasing, necessitating China to
invest military strength to enhance protection. China plans to promote the pearl chain
project in the Indian Ocean, which involves building dual-use military and civilian ports
and docks along the maritime Silk Road, to support China's deployment of military forces
abroad. The actions of the Chinese navy, such as deploying a series of patrols in the
Indian Ocean and establishing a logistics base in Djibouti, have reflected this trend.
Two is the issue of sharp strength. In recent years, China has increasingly tended to use
the economic stick to achieve its foreign policy goals, punishing countries that oppose
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Beijing's objectives. Japan, South Korea, and the Philippines have all been targets of
sanctions by China. At the same time, China also relies on its significant influence to
intervene in the politics and society of the relevant countries.
Three is the issue of the world order in the future. China views the BRI initiative as a
stage and has established financial mechanisms such as the Asian Infrastructure
Investment Bank (AIIB) and the Silk Road Fund. This is considered the Chinese version
of the "World Bank" and "International Monetary Fund," established by Beijing. The
ultimate goal for China is to establish a new world order centered around China. From an
economic perspective, this means that China will have the status to control the value
chain and the production chain. From a political perspective, China will exploit its
position to control their production chain, forcing neighboring countries to serve Beijing's
diplomatic goals.
Regarding China's global strategic intentions, U.S. Secretary of State Mike Pompeo once
believed that China's plans had changed 5 years ago, even 2-3 years ago. From China's
investment capacity when investing globally, this can be observed through the "imperial
purchase" method, using money to cause losses to the involved countries, while also
threatening U.S. interests. From that, it can be seen that in order to exert influence and
weaken international impact as well as the attractiveness of BRI development, the U.S.
has shown a readiness to compete fiercely.
2.3 The impact of strategy on American power
The United States has long held the leading position in the world in science and
technology. However, with China's rapid development in fields such as AI, 5G, and
biomedical research, the position of the United States is being seriously challenged.
China has become a direct competitor, especially in technologies that are strategically
significant for national security and global economic development.
One of the major consequences of the scientific competition between the US and China is
the trade and technology war. The U.S. has imposed sanctions and technology export
restrictions on China, particularly in areas such as semiconductor chips and AI. This
stems from concerns that China will use these technologies to enhance its military power
and exert global influence.
About the Economy: This trade war was initiated by the United States. Therefore, the
reason given by the U.S. is that China sponsors these countries to engage in unfair
competition, manipulate the market, and steal intellectual property. China not only causes
job problems but also poses a great threat to the American economy. That is the act of
forcing American companies to transfer technology; it is China's deliberate attempt to
undermine the technological foundation of the United States. Deeper down, it is China's
"Made in China 2025" strategy with ambitions to dominate many key sectors. These
issues will affect the interests of American workers and businesses.
In terms of politics: Not only does the U.S. hinder China in trade, but it also wants to
prevent China's overall rise. The rise of China has raised concerns for U.S. national
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security, as China's expanding influence could one day overturn the U.S.'s dominant
position in the Asia-Pacific region in particular, and in the world in general.
Regarding military and defense: The United States believes that China poses a threat to
its defense industry; it is an increasingly significant and substantial danger in providing
essential equipment to the U.S. military.
2.4 Forecasting the future
According to experts, the trend of strategic competition between the US and China will
continue for many decades to come, because: First, the development and comparison of
the power dynamics between the U.S. and China will continue to be complex and will
depend on various factors. Although China will continue to be the world's second-largest
economy and in nominal terms, the balance of power may equal that of the United States.

The scientific competition between China and the United States is likely to continue to
escalate in the coming decades.The U.S. has to face some challenges, such as maintaining
its position as a world superpower. Dealing with the rise of China.