Taipei/Brussels
China’s rise in the Asia Pacific and the resultant relative decline of U.S. economic influence and military capability have intensified competition between the two countries, with far-reaching implications for the global economy and international security. One important consequence of the increasingly confrontational relationship, in which ideological competition plays a role, is that the risk of military conflict between the U.S. and China in the Asia Pacific – while still low – has increased.
War between the world’s leading powers, both armed with nuclear weapons, would come at a devastatingly high economic and political cost, potentially imperilling much of the world’s maritime trade, but it is a remote prospect. A more immediate danger is a prolonged political crisis resulting from an accidental military collision. Such a standoff could further inflame tensions in the relationship, engender greater global economic instability and make it more difficult for third countries to balance their relationships with both Beijing and Washington. Already, the intensifying rivalry has impeded U.S.-China cooperation on major global issues, for instance prompting Washington and Beijing to compete over rather than cooperate in distribution of COVID-19 vaccines. Tariffs applied amid the U.S.-China trade war have heightened uncertainty around global trade and supply chains. Most Asia Pacific governments, deeply tied to China’s economy but reliant on U.S. security guarantees, have to walk a careful line.
The crisis in Ukraine has further entrenched assumptions in the two capitals that competition is necessary and will be protracted. For Washington, Beijing’s political and moral support for Moscow’s actions is evidence for the view that the world is splitting into two opposing, irreconcilable camps – democratic and autocratic – with Russia and China aligned in the latter. Despite limitations in the analogy, the war has also sharpened worries among Washington policymakers that Taiwan could be the next Ukraine, and focused minds on how to gird Taiwan for invasion and how to safeguard U.S. interests in the region. For Beijing, Washington’s relative success in unifying Europe and other allies behind economic and military pressures on Russia adds to its anxieties about the staying power of U.S. leadership, which may be greater than it would wish, its own economic dependency on the West and its prospects of unifying with Taiwan. Beijing believes that Washington provoked Moscow into attacking Ukraine and now seeks to prolong the conflict to weaken not only Russia, but China too.
Conflicting interests over Taiwan and the South China Sea are two key drivers of bilateral friction. Beijing claims Taiwan, an island approximately 180km east of China, as part of its territory and seeks to unify it with the Chinese mainland, even if the task requires military force. While Washington does not recognise Taiwan as an independent nation, it believes the island’s status should be peacefully resolved. The U.S. seeks to deter a Chinese military invasion by supplying Taipei with defensive weaponry. It has left ambiguous whether it would militarily intervene if China invaded. The South China Sea, a semi-enclosed sea linking the Indian Ocean and the western Pacific, has three groups of land features: the Pratas Islands in the north west, the Paracels in the north east and the Spratlys in the east. Overlaying disputes among China, Vietnam, Philippines, Malaysia, Brunei and Taiwan over the sovereignty of land features and sovereign rights in the waters around the features is a struggle between the U.S. and China over competing visions of maritime orders that advance their respective interests.
A major aspect of the South China Sea disagreement is China’s expansive maritime rights claims, which were invalidated by a 2016 ad hoc tribunal constituted under the 1982 UN Convention on the Law of the Sea (UNCLOS). The U.S. endorses the ruling, although it is not itself a party to UNCLOS, but China rejects it. Also important are divergent interpretations of the navigational rights that UNCLOS grants to user states like the U.S. in the Exclusive Economic Zones (EEZs) (the area extending 200 nautical miles, or nm, from a state’s coastline) and territorial seas (12nm from the coast) of coastal states like China.
For most of 2021 Washington and Beijing were at odds over the framing of the bilateral relationship, with each making clear that on issues like human rights abuses in Xinjiang, the end of Hong Kong’s political autonomy, Taiwan and the South China Sea the two sides’ positions remain far apart. Until 20 April, when U.S. Defense Secretary Lloyd Austin spoke with Chinese General Wei Fenghe by telephone, there had been no high-level defence contacts since the Trump administration was still in office.
Officials and scholars in both countries recognise the growing risks of U.S.-China competition, especially given dwindling diplomatic interaction in recent years. Experts on both sides call for improvements and embellishments to the crisis management mechanisms – in particular, operational rules that help make military encounters safer, hotlines and dialogue for the purpose of exchanging views – that have been created to reduce the risk of conflict between the two powers.
This report explores the respective views of Beijing and Washington on risks in the bilateral relationship and crisis management, and makes recommendations with respect to the latter. The report focuses in particular on the tensions that arise from the two militaries’ growing presence in the Taiwan Strait and the South China Sea. It does not attempt to address the full range of risks that exist in the bilateral relationship – the impact of China’s growing nuclear capabilities on strategic stability, for instance, or the potential escalation pathways created by the advancing cyber, space and artificial intelligence capacities of both countries. Because of COVID-19 travel restrictions and other security concerns, all interviews were conducted remotely, via telephone or video conference platform. All interviews with Chinese experts are anonymously attributed; the preponderance of Chinese experts interviewed are currently or formerly affiliated with government or military think-tanks.
The U.S.-China relationship has settled into an openly competitive dynamic in which decision-makers on both sides are more risk-tolerant and see the introduction of friction as necessary for achieving national objectives. Importantly, both governments see competition as partly about a rivalry of domestic systems and contending visions of world order. The fact that both governments view the contest through an ideological lens increases the likelihood that one or the other will perceive an unintended military collision or a spike in tensions around a longstanding dispute as a high-stakes event that tests the credibility and effectiveness of the political system it espouses, making conflict management more difficult.
Following years in which the Trump administration chipped away at democratic institutions and norms at home and pursued a foreign policy centred on U.S. unilateralism, Washington is anxious to, as President Joe Biden put it, “prove democracy works”. The administration assesses that what U.S. officials refer to as the international rules-based order is under stress from autocracies and that the U.S. must work with other democracies to ensure that the world remains democratically-led and governed by the existing order. Washington’s view of the rules-based order can be broadly defined as the U.S.-led post-World War II system of international institutions, rules and norms, which the U.S. sees as the basis of global prosperity and stability – as well as the foundation on which U.S. moral authority and global influence rest.
Within this worldview the U.S. assesses China to be “the only competitor potentially capable” of challenging the existing international system, pointing to what it characterises as Beijing’s use of coercion and (in some cases) aggression, along the Line of Actual Control with India, with Taiwan and with neighbours in the East and South China Seas as indicative of China’s threat to the rules-based order. In the face of Beijing’s growing confidence in its own institutions, U.S. officials also believe that a key element of competing with China is getting things in order at home to demonstrate to its rival that the U.S. political system can perform.
China’s long-term objective is to achieve “national rejuvenation” by 2049, defined as becoming a “modern socialist country that is prosperous, strong, democratic, culturally advanced and harmonious”. The leadership believes that it faces a world undergoing “major changes unseen in a century”, a transitional period in which U.S. unipolar power has ended, but Beijing is not yet strong enough to assume a position as Washington’s peer. Party writings exhorting the bureaucracy to “actively create a positive external environment” and to extend an “important period of strategic opportunity” suggest that Beijing believes its management of this transitional period, and in particular its thwarting of U.S. efforts to form anti-China coalitions, is a key determinant of the pace and trajectory of its development and rise.
Beijing views Washington’s emphasis on ideological differences between democracies and autocracies as a rebuke of its “socialist system with Chinese characteristics”, aimed at diminishing on the international stage the moral authority and legitimacy of the Chinese system and the Communist Party of China (CPC). Washington’s criticism of Beijing’s policies in Xinjiang and Hong Kong and its deepening engagement with Taiwan, in particular, reinforce longstanding anxieties in Beijing that external forces are attempting to change China’s political system and to undermine the CPC. In response, Beijing has more openly embraced the notion that rivalry between Western and Chinese political systems is a key aspect of competition, arguing not only that its own institutions are a form of democracy, but that the system is successful because of what it has delivered for the Chinese people.
B.Competition through Military Presence
Military signalling is playing an increasing role in the bilateral relationship. Demonstrations of military resolve are particularly prominent within and around the first island chain, an area where the two governments see national interests at stake and where a shift in the balance of military power increasingly in China’s favour has accelerated a struggle for military advantage. The first island chain is a string of islands composed of Japan’s Ryukyu Islands, Taiwan, the Philippines and Borneo that enclose the waters bordering China. Washington and Beijing each views the expansion of its own military presence and exercises in the area as rightful, “normal” and necessary for achieving the objectives discussed below, while regarding the other’s military presence and activities as implying hostile, aggressive intent.
1.China’s outward push to achieve “national rejuvenation”
China believes that ensuring control of what it calls its near seas, within and around the first island chain, is essential to its defence, as well as its “national rejuvenation”, part of which is the goal of becoming a maritime power. Accordingly, the capabilities of China’s military, the People’s Liberation Army (PLA) and its presence within and around the first island chain have rapidly grown in the last two decades. By one measure, the number of Chinese naval vessels has tripled, from 110 ships in 2000 to 360 in 2020. Chinese military exercises take place regularly, at times in several seas at once; according to Chinese state media, the PLA conducted 120 drills over three months in 2021 in the Bohai Sea, the Yellow Sea, the East China Sea, the Taiwan Strait and the South China Sea.
Chinese strategists view the first island chain as a “hostile fortification” that the U.S. and other foreign forces could use to constrict or block the movements of Chinese vessels and aircraft from its near seas out to the western Pacific. In response, Beijing has increasingly sent its warships and aircraft through key passageways along the chain, including waterways between Japan’s islands and near the western entrance of the Bashi Channel, a main thoroughfare for submarines that lies just south of Taiwan.
Beijing regards controlling its near seas as a necessary condition for achieving unification with Taiwan and defending its claims in the East and South China Seas. Moreover, Beijing believes that alongside growing military capabilities it should demonstrate its increased ability to defend these interests and related sovereign claims before both domestic and international audiences. Near-daily sorties near the Bashi Channel are intended to credibly convey to several audiences the depth of Beijing’s resolve to unify Taiwan with the mainland. Around the Diaoyu/Senkaku Islands in the East China Sea, which both China and Japan claim, Beijing maintains a continuous presence of coast guard vessels to advance its assertion of sovereignty.
In the South China Sea, Beijing has outfitted artificial islands it built with military assets and structures, including anti-air and anti-ship missiles, radar platforms and hangars that can accommodate military aircraft. Beyond significantly expanding China’s ability to project military power across the disputed Sea, the outposts also facilitate the regular presence of China’s coast guard there. When South East Asian claimant states exploit oil and gas resources in their EEZs in areas that overlap with Beijing’s expansive claims, China dispatches coast guard and research vessels to patrol and conduct surveys nearby. Beijing regards such responses as essential for demonstrating resolve and for deterring other South East Asian claimant states from what China sees as provocations.
2.U.S. defence of a “rules-based order”
The U.S., which has enjoyed military dominance in East Asia since World War II, believes that bolstering its military deterrence in the region is important for providing security for itself and its allies, for ensuring its access to Asian markets and for promoting U.S. values. Washington is concerned that China’s increasing ability to limit U.S. access to, and operations within, the first island chain during a potential conflict will hamper it in responding to events affecting U.S. interests or those of partners and allies. For instance, China’s DF-26 anti-ship ballistic missile can strike a moving U.S. target from 4,000km away, long before a U.S. aircraft carrier could come near China’s periphery.
Senior U.S. military officials assess that unless they strengthen deterrence, China will be emboldened to engage in aggression against U.S. allies and partners and to displace what Washington calls the rules-based order. As one element of deterrence, the U.S. began stepping up its military presence in China’s periphery under the Trump administration, calculating that the operational risks of doing so paled alongside the strategic risks of not being present. As one former senior official put it, “If we are not operating in their space, we are ceding to their claims”. In April 2021, a Chinese defence spokesperson said the number of “activities” conducted by U.S. warships and surveillance aircraft in the sea areas around China had increased by more than 20 per cent and 40 per cent respectively, compared with the same period in 2020.
According to publicly available information, U.S. freedom of navigation operations in the South China Sea steadily grew between 2015 and 2020, from one to ten operations per year; in 2021, the number declined to five. Washington uses freedom of navigation operations to challenge what it believes are China’s excessive claims in the South China Sea; claims that it argues wrongly restrict navigation and overflight rights and freedoms guaranteed under international law. These operations generally involve a U.S. warship sailing within 12nm of a Chinese outpost in the South China Sea or through Chinese-claimed waters around the Paracel Islands.
In response to Chinese attempts to deter South East Asian claimant states from exploiting seabed natural resources, the U.S. for the first time in May 2020 dispatched warships to conduct “presence operations” near a standoff at sea involving the Malaysian-chartered drillship West Capella and Chinese survey and law enforcement ships. In September 2021, the U.S. deployed an aircraft carrier close to an Indonesian oil rig that was subject to similar Chinese pressure.
As for the Taiwan Strait, U.S. naval transits through the strait reached a record thirteen in 2020; in 2021, the number – twelve – was almost as high again, in a sign of Washington’s concern about China’s increasing ability to forcibly unify with Taiwan through an invasion.
The scale and complexity of U.S. military exercises, including with partner countries, also appear to be increasing. In August 2021, for instance, the U.S. Navy conducted its largest exercise “in a generation,” involving its fleets in both the Atlantic and the Pacific Oceans, as well as British, Australian and Japanese ships and planes. Public data for U.S. reconnaissance flights in China’s periphery is scarce and incomplete, but it suggests that the tempo of operations is high. A Beijing-based think-tank reports that the U.S. conducted nearly 1,000 reconnaissance sorties in the South China Sea in 2020 and 1,200 in 2021. Reconnaissance missions can provide the U.S. with intelligence on Chinese military movements and exercises and are also a means of demonstrating U.S. military presence.
Just as Washington sees aggressive intent behind China’s increased military and paramilitary presence, Beijing has long viewed the U.S. military presence along its periphery as provocative, hostile and unjust. It officially describes U.S. reconnaissance activities and freedom of navigation operations as undermining China’s national security. China’s position reflects a deeply held view that the U.S military presence along its periphery is a deliberate attempt to injure China’s national dignity.
C.The Risks of Miscalculation and Escalation
1.Strategic miscalculation and misperception
The competitive lens through which decision-makers in Beijing and Washington are interpreting developments, coupled with an uptick in military operations and decline in dialogue, raise the potential for the two governments to misread each other’s intentions at the strategic level over sensitive issues, such as the South China Sea and Taiwan.
For decades, Beijing and Washington have relied on certain overlapping, though not convergent, understandings to maintain peace and stability in the Taiwan Strait. Beijing’s position is that there is only one China of which Taiwan is a part. Its objective is unification with Taiwan – which it sees as critical to national rejuvenation and the CPC’s legitimacy – and it holds out the possibility of using military force to achieve this end. Washington recognises the People’s Republic of China as the sole legal government of China, acknowledges Beijing’s position on Taiwan and says it has no intention of pursuing a policy of “one China, one Taiwan”. But it maintains unofficial ties with Taiwan and believes that the question of Taiwan’s sovereignty is unsettled and should be resolved peacefully between the two parties. The executive branch is mandated to provide Taiwan with defensive arms and to maintain its capacity to resist any attempt at force or coercion that would jeopardise the security or the socio-economic system of the Taiwanese people.
Though the two positions diverge in certain respects, they have allowed both sides to arrive at a modus vivendi by which Washington maintains a delicate balance between Beijing and Taipei within the bounds of its commitments to both sides, while China pursues peaceful unification. This tacit arrangement allowed the U.S. and China to normalise relations in 1979. It has helped keep a fragile peace since then.
Nevertheless, China’s rapid military modernisation and more assertive military posture in the region have altered U.S. perceptions of the threat that China poses to Taiwan, causing Washington to consider a Chinese military invasion of Taiwan possible and to question its own ability to prevail if it were to intervene to prevent forcible reunification. Competition with Beijing has also led Washington to attach geopolitical stakes to Taiwan that extend far beyond the island itself; as one former U.S. official put it, U.S. strategists are increasingly understanding Taiwan as a “first battle of the U.S.-China contest over the future of Asia”. The Biden administration has deepened Washington’s unofficial ties with Taipei, reframed the Taiwan problem as an international issue with regional security implications and worked to reduce Taiwan’s international isolation, in a reflection of both Washington’s determination to deter Chinese aggression and the importance attached to Taiwan.
Beijing in turn sees Washington as cynically employing the Taiwan issue as a pressure point in the larger bilateral competition. It believes that Washington’s deepening engagement on Taiwan dangerously alters the status quo by strengthening Taiwan’s claims to independence and forestalling Beijing’s plans for unification. It has responded with more acts of military and economic coercion that further confirm Washington’s suspicions. Though the U.S. has made clear its policy is not to support Taiwan’s independence, its posture has led China to question how far the Biden administration will go to convey its commitment to Taiwan. A direct conflict over Taiwan is only a remote possibility in the near term, but the current dynamism, in which the two sides are tussling over a new equilibrium, will motivate both Washington and Beijing to keep showing resolve in ways that generate tensions and uncertainty over intentions.
In the South China Sea, tensions have risen as growing Chinese military capabilities and assertiveness have prompted Washington to push back politically and militarily. For Washington, Beijing’s ability to exercise control over the South China Sea in peacetime and to deploy paramilitary and civilian assets across the breadth of the waters it claims raises questions about whether an even more capable China will attempt to restrict or deny U.S. access to the area in the coming years. As noted above, the U.S. has since the Trump administration stepped up its military operations and deployments in the area. In a July 2020 statement, furthermore, Washington explicitly rejected China’s claims to offshore resources across the South China Sea, in accordance with the 2016 award. Previously, the U.S. had taken no position on the maritime dispute and was more narrowly focused on upholding U.S. freedom of navigation and overflight.
In the autumn of 2020, the Chinese government appeared to misread U.S. actions as signs of intent to initiate a limited conflict in the South China Sea. Theories of a U.S. “October surprise” attack on Chinese outposts in the Spratly Islands began to circulate widely in Beijing that July, abetted by a sharp decline in the bilateral relationship and Washington’s rejection of China’s maritime rights claims. A popular article by a retired Chinese military official argued that Trump was “very likely” to provoke a military conflict with China in the Spratlys as a means of securing his re-election. The piece pointed to the closing of consulates in Houston and Chengdu, the shift in Washington’s South China Sea policy and what Beijing saw as “pre-war tactical and technical reconnaissance” activities in the Sea as evidence of an impending U.S. attack.
According to a former U.S. defence official, by mid-October, Chinese government anxieties “had gone off the rails”. The U.S. assessment of Chinese concerns was based on official statements made by the Ministry of Foreign Affairs and the PLA, the views of military officials and Chinese scholars, and the content of state media, as well as the PLA’s large-scale military drills and heightened readiness. U.S. officials responded by directly informing Chinese officials that the U.S. would launch no such attack. Following these conversations, in October 2020 a Chinese defence spokesperson refuted media reports of a possible U.S. attack, saying “the U.S. side has no intention of creating a military crisis with China”. The event illustrates the potential for the two governments to radically misunderstand each other’s intentions, though it wound up providing a positive example of how they can communicate in exigent circumstances.
2.Sparks from a collision at sea or in the air
The two governments’ use of increased military presence in the South China Sea and Taiwan Strait to send political signals means that the probability of encounters between U.S. and Chinese forces in the air and at sea and related risks have likely risen. Both Chinese and U.S. experts say interactions are mostly safe and professional, due in part to the familiarity the two sides have accrued from decades of operating in proximity. Nevertheless, the recent history of encounters is sprinkled with near misses and accusations of unsafe, unprofessional behaviour. Decision-making on these occasions, which are highly stressful, is left to individuals who are susceptible to human error, and who, influenced by their governments’ political attitudes, may be motivated to act assertively on the front lines. As a Chinese analyst put it, “Humans have emotions and lose control”.
There are new risk factors as well. Encounters are occurring under new scenarios, including in areas where the maritime claims of South East Asian states and China overlap, and in the southwestern corner of Taiwan’s air defence identification zone.
Close encounters between U.S. and Chinese military vessels and aircraft tend to occur during the U.S. military operations that Beijing most strongly opposes, but that Washington believes are important for upholding its prerogatives under international maritime law. Historically, these have concerned U.S. survey and surveillance activities in China’s Exclusive Economic Zone, an area stretching out 200nm from the mainland coast. In recent years, however, information publicised by the two governments and media suggest, anecdotally, that the types of interaction that lead to close calls are more diverse.
In many cases, Chinese warships and aircraft tail, or more rarely, attempt to intercept and drive away U.S. vessels and aircraft conducting freedom of navigation and reconnaissance activities as a means of registering protest and discouraging more such operations. In September 2018, a Chinese warship steamed directly at a U.S. Navy destroyer conducting a freedom of navigation operation, in an attempt to push the vessel out of the area within 12nm of Gaven Reef, a rock feature China has built up in the Spratlys. The two ships came within 41m of each other; the U.S. vessel prevented a collision by manoeuvring out of the way.
In 2018, the U.S. Pacific Fleet reported eighteen “unsafe and/or unprofessional” encounters with Chinese military forces in the Pacific between 2016 and late 2018; officials quoted in the media said “at least three” of these involved Chinese fighter jets making “unsafe” intercepts of U.S. surveillance planes. According to a Pentagon official, nine “concerning incidents” involving U.S. and Chinese aircraft occurred between March and May 2020. Encounters take place around military exercises; in April 2021, a Chinese official said a U.S. destroyer conducting reconnaissance on a Chinese aircraft carrier formation “seriously obstructed” operations and “threatened the safety” of both sides.
The one collision that has occurred between Chinese and U.S. forces – now more than two decades ago – offers a useful case study of the challenges of managing such incidents. On 1 April 2001, a U.S. EP-3 reconnaissance plane and a Chinese fighter jet unintentionally ran into each other, killing the Chinese pilot and forcing the U.S. crew to make an emergency landing on Hainan Island (China’s largest island, to the south of Guangdong province). China blamed the collision on the U.S., and initially demanded an apology for the Chinese pilot’s death and the EP-3’s landing without permission. For Beijing, key objectives included safeguarding China’s sovereignty and national dignity, as well as avoiding appearing weak before the Chinese public. The U.S. wanted the return of its crew and aircraft, but it did not want to apologise because it believed the Chinese pilot’s recklessness had precipitated the incident. A key concern for Washington included appearing “bullied” by China in the eyes of the U.S. public or peoples and governments in the Asia Pacific.
One Chinese perspective on the incident described the U.S. insistence on its right to conduct spying activities in China’s EEZ and Washington’s demand that Beijing return the crew and aircraft without expressing regret in return as evidence of callousness and Washington’s tendency to maximise its interests above all else during a crisis; at the time, Beijing described this U.S. position as “the logic of hegemony”. A U.S. account said U.S. officials saw Beijing’s response to the incident as attaching worryingly little importance to the facts of the collision and international norms for handling the incident.
The parties ultimately arrived at a pragmatic solution, which involved the U.S. sending a letter saying it was “very sorry” for the loss of life and for entering Chinese airspace without verbal clearance, but not apologising for the collision itself. This workaround resulted in the U.S. crew’s repatriation; China returned the EP-3 three months after the incident. Importantly, neither side insisted on settling what caused the collision or who was responsible.
While experts on both sides concur that a collision at sea or in the air is unlikely to result in all-out war – as neither side desires such a confrontation – they also tend to agree that, in the present political climate, such an incident could escalate in a way that is hard to control, leading to a period of heightened military tensions and political crisis. As a Chinese scholar emphasised, “the essence of crisis is not peaceful”. After a major incident, both governments are likely to “engage in a game of chess” to secure maximum benefit, even while they seek to avoid outright conflict.
With bilateral competition intensifying and cast in an ideological light, both sides may attach higher stakes to the defence of national interests during a crisis or even see opportunities to further national interests. One party may be tempted to use an incident to signal its own position more forcefully to the other as a means of shaping its rival’s future behaviour or of gauging its rival’s resolve in a dispute. PLA strategic thinking characterises crises as creating both risks and opportunities; among the latter are chances for conflict parties to “show their bottom line, find out their opponents’ cards and finally reach a compromise”. U.S. officials also sometimes see crises as opportunities not just to better understand Washington’s adversaries, but also to advance the U.S. strategic agenda.
By way of illustration, one Track 2 exercise indicates that if an unintended collision between U.S. and Chinese vessels were to ground a U.S. warship within China’s declared straight baselines around the Paracel Islands, waters over which Beijing considers itself sovereign, China might respond by denying the U.S. access to the site of the incident. Such a response, meant to defend Chinese interests, would also set up a test of U.S. resolve. The U.S. does not recognise China’s baselines and it would therefore consider the incident site to be on the high seas, where it has the right to navigate and deploy assistance. In the exercise, both teams dispatched military vessels and aircraft to the collision site, bringing two militaries tasked with directly opposing missions into close proximity, before a compromise was identified.
De-escalation is not a foregone conclusion.
But de-escalation is not a foregone conclusion in these scenarios, when bargaining would be influenced by public opinion and the potentially flawed assumptions of decision-makers. Because of the increasingly competitive frame in which both Washington and Beijing cast their bilateral relations, once an incident is known, both will come under domestic pressure to assert their views on fault and make their follow-on demands resolutely and quickly, reducing the space for negotiation.
During the EP-3 episode, the first statement from the U.S. publicising the incident brought a tough Chinese reply, setting off a heated exchange that contributed to the political impasse. At several points, both sides chose to state their positions publicly before consulting with the other side and before ascertaining all the facts, locking them into positions that made private compromise more difficult.
Those unhelpful dynamics would likely be magnified in the present environment. In the face of rising domestic nationalism, Beijing will seek to defend Chinese dignity and may prioritise publicly blaming the U.S. over managing the fallout. PLA writings emphasise the importance of actively guiding domestic and international public opinion during a crisis to shore up support for China’s position. In the U.S., being tough on China is one of the few foreign policy stances that commands bipartisan consensus. The Biden administration would have much less space to show flexibility around assignment of responsibility for an incident than the Bush administration had in 2001.
Heightened distrust will make it harder for decision-makers with incomplete information to discern the other side’s intentions, whether regarding the incident itself or its aftermath. According to one media report, in the months leading up to Russia’s invasion of Ukraine, Chinese officials repeatedly responded with scepticism to U.S. intelligence of the Russian troop build-up; instead of being persuaded by the information, they thought Washington was trying to sow discord between Moscow and Beijing. In a crisis, misinterpretation could result in disproportionate responses, with escalatory effects.
III.Mismatched Interests and Crisis Management
U.S.-China crisis management mechanisms have existed since the late 1990s and largely fall into three categories: 1) consultations and rules that promote operational safety; 2) defence and military dialogues; and 3) crisis communication channels or “hotlines”. Most existing mechanisms emerged from the political momentum generated by two summits – one attended by Presidents Bill Clinton and Jiang Zemin in 1998 and another bringing together Presidents Xi Jinping and Barack Obama in 2014.
On the whole, the existing mechanisms have contributed to a stable bilateral relationship that has been free of major incident since the 2001 collision, but they have also fallen short of their full potential. While it is difficult to measure, some experts argue that the mechanisms are one reason why the two militaries’ interactions at sea and in the air have become more professional in the last two decades, including by helping socialise the PLA to standard international practices. At the same time, the existing guardrails remain “underdeveloped and underutilised,” in the words of one former U.S. government official, contributing to fears in Washington and Beijing that they are insufficient for preventing or managing a crisis amid rising risks. A review of how the two parties have used the existing mechanisms can help identify where improvements of implementation can be found and how the mechanisms themselves can be strengthened.
A.Mechanisms for Promoting Safer Encounters
1.Asymmetric interest in risk reduction
The Maritime Military Consultative Agreement (MMCA) and Rules of Behaviour create overlapping mechanisms for managing the risk of military encounters between U.S. and Chinese forces. Since 1998, the MMCA has provided the two countries’ military officials with a framework for almost yearly consultations on safe maritime practices. In 2014, to complement the MMCA, the two governments produced the Rules of Behaviour and its annexes, which reaffirm the parties’ adherence to communications procedures and navigation safety protocols in existing international conventions and codes, including UNCLOS, the Convention on the International Regulations for Preventing Collisions at Sea (COLREGs), the Convention on International Civil Aviation (Chicago Convention) and the non-binding Code for Unplanned Encounters at Sea (CUES).
The Rules encourage vessels and aircraft that encounter one another at sea or in the air to actively communicate, “to maintain safe distance to avoid the risk of collision” and to refrain from making “reckless manoeuvres” or taking actions that could be misinterpreted – for instance, simulated attacks. Beijing and Washington review implementation of the Rules together in the MMCA yearly meetings.
As noted, China regards U.S. military activities along its periphery as disrespectful of China’s sovereignty and national security concerns and suggestive of U.S. hostile intent. Against this backdrop, China seeks to balance two imperatives in its engagement with the MMCA and the Rules of Behaviour. Beijing is uninterested in a crisis; it wants to keep a lid on tensions with Washington in order to pursue its goal of national rejuvenation as unhindered as it can be. But Beijing is also disinclined to make it easy for Washington to maintain its military presence on China’s doorstep. It is concerned that overly clear deconfliction commitments could encourage U.S. operators to be less restrained. For Beijing, the primary source of risk is U.S. military presence; placing the onus on China to exercise restraint ignores this root cause. As a Chinese analyst put it, “Don’t come, and then it will be safe”. Chinese experts also argue that the mechanisms “provide safety” for U.S. military operations near China but are less beneficial for the PLA, whose operations near the U.S. remain infrequent by comparison.
In balancing its interests, Beijing complies with the existing mechanisms selectively. It participates in MMCA consultations – to signal its desire to prevent a major incident with the U.S. – but seeks to maximise its position by using these discussions to also register its protest of the U.S. military presence in ways that take away from discussions of operational safety.
The U.S. sees things differently. It believes its operations and presence in the area are in accordance with international law and therefore legitimate. It seeks to make encounters safer so that its military can operate in a more predictable environment; for Washington, the source of risk is the recurrence of encounters that arise from unprofessional, unsafe Chinese behaviour. U.S. experts say the MMCA platform was established precisely so that the two sides could discuss technical and operational safety issues in a format shielded from the discussion of larger differences. They note that other mechanisms are in place for the two governments to engage on policy issues.
2.Falling short of potential: The MMCA and Rules of Behaviour
Despite the MMCA and Rules of Behaviour’s contributions to a relatively stable relationship, Washington and Beijing’s mismatched interests and ambiguities found in the Rules themselves limit the effectiveness of both.
MMCA meetings are often consumed with disagreement over whether policy issues – namely China’s security concerns – should be included in the agenda. They have thus produced little progress on clarifying what safe encounters should look like. In 2005, the two sides created a Special Policy Dialogue mechanism in order to “discuss policy problems separate from safety concerns under the MMCA”. These meetings evolved into the Defense Policy Coordination Talks in 2006, a dialogue that still exists. But the two sides have yet to establish a pattern of meaningful engagement. In December 2020, they failed to convene a scheduled MMCA meeting again because of a dispute about what its agenda should be, in a particularly public spat. In a more positive sign, the two militaries came to an MMCA meeting in December 2021, though statements issued by each side showed that differences over objectives remain wide.
As for the Rules of Behaviour, these remain a weak instrument because of their non-binding nature, the ambiguity of certain key terms they contain, and limits in the scope of the 2014 Memorandum of Understanding and 2015 annex that sets them out. Among their most important provisions, the Rules and their annex concerning air-to-air encounters encourage “safe distance” between vessels and “safe separation” between aircraft, while at the same time noting that these concepts are circumstantial. For instance, they recommend considering visibility, traffic density and navigational hazards when determining safe distances between vessels. Yet whether an encounter is considered safe is inherently subjective; a close interception that occurs at high speed might be unsafe in the hands of an inexperienced operator but perfectly safe in the hands of an experienced one. Though it is not feasible to reach a universal definition of “safe”, MMCA consultations could help narrow the gap in interpretations. Progress on this front has been limited, however, for the reasons noted above.
Both U.S. and Chinese experts agree that the Rules [of Behaviour] do not extend to maritime encounters that take place in either country’s territorial seas.
The Rules do not necessarily apply to the encounters that are most likely to result in a potentially escalatory incident. Both U.S. and Chinese experts agree that the Rules do not extend to maritime encounters that take place in either country’s territorial seas. Because U.S. warships conducting freedom of navigation operations and Chinese vessels often encounter each other in parts of the South China Sea where China claims a territorial sea exists and the U.S. disagrees, there is no meeting of the minds as to where the Rules apply.
The 2015 air-to-air annex of the Rules contains major caveats that make measuring compliance difficult if not impossible, saying military aircraft that encounter each other in flight should operate consistent with the navigational safety and communications procedures found in the Chicago Convention “to the extent practicable when compatible with mission requirements” and implement those in the CUES “in good faith”. (The rules detailed in the air-to-air annex draw heavily from the convention and the CUES.)
Because the Rules of Behaviour are non-binding and contain elements of ambiguity, they are difficult to enforce and susceptible to politicisation. As a Chinese analyst put it, the operationalisation of the rules requires a “positive political atmosphere”. There is nothing in the tentatively worded Rules to prevent Chinese actors from adopting more muscular responses to U.S. operations when it feels it is politically necessary or useful in light of China’s view that displays of U.S. military resolve must be met by comparable shows from the Chinese side. At the same time, ambiguity about what constitutes an unsafe encounter also gives U.S. actors the space to at times unconstructively charge Chinese operators with being unprofessional and unsafe for political reasons – for instance, to appear tough on China before domestic audiences – rather than strictly technical ones.
B.Defence and Military Dialogues
In recognition of the role regular communications between defence and military officials can play in minimising misunderstanding and reducing distrust between the two governments, Washington and Beijing have over the years engaged in regular contact. High-level exchanges at the defence secretary/minister level and between senior military officials generally take place during bilateral visits on the sidelines of multilateral meetings by video teleconference or through bilateral mechanisms that also involve the two countries’ diplomats – for instance, the Diplomatic and Security Dialogue under the Trump administration.
Recurring dialogues at the working level play a key role. Aside from the MMCA mentioned above, the Defense Consultative Talks established in 1998 involve the U.S. under secretary of defense for policy and PLA deputy chief of general staff; the Asia-Pacific Security Dialogue established in 2014 convenes the U.S. assistant secretary of defense and the director of China’s Office for International Military Cooperation; and the Defense Policy Coordination Talks created in 2006 bring the U.S. deputy assistant secretary of defense together with the Chinese deputy director of the Office for International Military Cooperation.
Notwithstanding these many channels, however, maintaining continuity in U.S.-China dialogue has historically been a challenge. Both governments, particularly Beijing, have occasionally cancelled or delayed meetings as “a low-cost but highly indicative policy tool”, to protest actions taken by the other side. After the U.S. sanctioned the PLA in 2018 because it had purchased arms from Russia, Beijing called off discussions between the two sides’ joint staff departments. The effect has been to curtail exchange precisely when it is most valuable, during periods of heightened tension.
Interest in [U.S.-China] dialogue has faded, particularly in Washington.
Interest in dialogue has faded, particularly in Washington, where critics point to Chinese officials’ tendency to repeat talking points rather than engage in discussions, their lack of seniority compared to U.S. delegates and the absence of tangible results as evidence that dialogue is not valuable. The new U.S. thinking is tied to the overall shift of approach toward China, from an engagement policy that assumed China’s domestic and foreign policies would change in ways the U.S. prefers if bilateral ties deepened to one premised on the idea that no amount of dialogue will alter Beijing’s calculus and that U.S. should approach discussions with China from a position of strength. Washington’s studied disdain for engagement that is not explicitly results-oriented or reciprocal has prompted a rebuffed Beijing to respond with its own demands for dialogue on an “equal footing”. Still, Beijing has since 2017 described military-to-military ties as a “stabilising factor” overall – a perspective that, if it prevails, could curb China’s interest in using defence relations as a signalling device as competition grows.
High-level dialogue has thus been intermittent since 2017, while the number of defence visits, communications and exchanges has declined, from a peak of 41 in 2014 to fewer than twenty per year during the Trump administration’s tenure. Before late April, as mentioned above, there had been no contact between U.S. Defense Secretary Lloyd Austin and any of his Chinese counterparts. At the working level, the Defense Consultative Talks and the Asia-Pacific Security Dialogue last took place in 2014 and 2019, respectively. The Defense Policy Coordination Talks and the MMCA consultations both occurred in 2021.
During the Trump years, perhaps because the overall course of relations had become more unpredictable, Beijing began accepting additional dialogue mechanisms that explicitly concerned crisis prevention and communications. Beijing agreed in 2017 to a Joint Staff Dialogue Mechanism that would promote “direct communication at the three-star level” for crisis mitigation, and in 2020 to establishment of a Crisis Communications Working Group to discuss crisis communication, prevention and management concepts. Both mechanisms convened only once. The Joint Staff Dialogue Mechanism held a first meeting in November 2017; Beijing cancelled a second meeting in 2018 because of U.S. sanctions. The Crisis Communications Working Group last met in 2020. Chinese officials’ willingness to use the word “crisis” signals acceptance of the increasing risks and the possibility of having to manage a confrontation with Washington.
According to a former U.S. official, in late 2020 the U.S. and China also agreed to the establishment of a new Policy Dialogue System that would more tightly weave together existing defence dialogues into a single system, with the aim of making the defence relationship more routine and more resistant to political disruption. The system would prioritise discussion of risk reduction and crisis communications, linking those discussions to broader dialogue about the causes of crises, in an attempt to balance U.S. and Chinese interests. Mention of the new framework in the U.S. Department of Defense 2021 annual report on China suggests that Washington believes the parties have come to agreement on this new mechanism; it is unclear, however, whether Beijing is fully on board.
C.Crisis Communications
Timely, high-level communications that convey clear messages of intent are crucial for effective crisis management and de-escalation. Two main U.S.-China crisis communication channels exist – a presidential hotline established in 1998 and a Defense Telephone Link established in 2008 between the U.S. Department of Defense and China’s Ministry of National Defence. The effectiveness of the presidential hotline in the event of a U.S.-China crisis is questionable. Clinton used the hotline to ask Jiang to help dissuade Pakistan from testing nuclear weapons following India’s May 1998 tests. But a year later, after U.S. bombs hit the Chinese embassy in Belgrade, the initial U.S. request for a call from Clinton to Jiang went unanswered (Jiang accepted a call a week later during which Clinton apologised to China, saying the bombing was an accident). Neither side used the presidential hotline during the 2001 EP-3 incident.
Because the Defense Telephone Link was not designed to facilitate immediate communications, and instead provides a secure channel for scheduled communications to take place between senior military and defence officials, its value during a crisis would likely be limited. Under current arrangements, each side has to request a call at least 48 hours in advance and respond within 24 hours of receiving a call request.
But the role the Defense Telephone Link can play in crisis prevention – as opposed to crisis management – appears significant. The two governments have in recent years increased their use of the Link: the Pentagon reported two high-level calls in 2017, three calls in 2018, six in 2019 and seven in 2020. Moreover, the Link helped reduce misunderstanding during the “October surprise” scare of 202o, when discussions began circulating in Beijing of an impending U.S. attack on the Spratlys. After learning of China’s concerns, several U.S. defence officials used the Link to communicate to their Chinese counterparts that their analysis was inaccurate. Chinese officials told U.S. officials the information they had shared was extremely important.
While Washington has made clear its interest in establishing additional hotlines to improve communications during a crisis, Beijing seems less enthusiastic. Beijing has been increasingly open to talking to Washington about crisis prevention and communications – as mentioned previously, it agreed to two new dialogues in 2017 and 2020 – but appears non-committal about setting up actual hotlines that could be used during a crisis. When asked by the media about whether they share the U.S. interest in additional hotlines, Chinese foreign ministry officials said bilateral hotlines already exist. For their part, defence officials expressed scepticism about Washington’s motives given increased U.S. military deployments to Asia. The doubts suggests that Beijing is interested in discussions of hotlines only if they can provide it opportunities to raise objections to those deployments.
U.S. experts and officials question whether China would communicate during a crisis, even with additional channels, pointing to past episodes in which Beijing did not do so. Following the EP-3 incident, U.S. embassy calls to the Chinese government went largely unanswered for twelve hours – and the officials who did answer supplied no information. The first statement from China on the incident was issued “at roughly the same time” as its first meeting with the U.S., meaning the Chinese position was likely formed prior to consultations with the U.S. Chinese experts argue that the past is not indicative of the future in this regard and that Beijing would pick up the phone if a “real crisis” occurred.
A key impediment to the effective use of a communications channel is China’s increasingly centralised decision-making, which tends to prevent communications from occurring in a timely manner, whether during a crisis or not. Until the leadership makes a decision on how to respond to a new development or crisis, any attempt to communicate will likely be one-way, with Chinese officials unable to provide substantive information in return. Unlike senior U.S. officials, senior Chinese officials do not have the authority to decide on their own whether to engage in communications with their U.S. counterparts. For instance, when a U.S. official wants to speak to a Chinese counterpart using the Defense Telephone Link, the call does not directly reach the office of the intended counterpart; requests must be approved through an intermediary body, the Central Military Commission’s Office for International Military Cooperation.
Different approaches to crisis communications might also impede timely communications during a crisis, even if additional channels were to exist. During a crisis, Chinese officials might believe that the very act of initiating communications signals acceptance of responsibility for an incident and thus that the aggrieved party should not make the first move. Beijing might therefore refrain from calling first if it considered Washington’s actions leading up to a crisis to be illegitimate or if it perceived itself as the victim.
IV.Making the Most of U.S.-China Crisis Management
The risk of a crisis between the U.S. and China has grown. Washington and Beijing’s embrace of strategic and systemic competition, which the Ukraine crisis has only intensified, has seen both governments tolerate more friction in the relationship, and increasingly rely on military operations and presence for purposes of political signalling. The most sustainable means of reducing conflict risks involves reaching political accommodation around the South China Sea, Taiwan and other flashpoints. Reduction of the two militaries’ presence and operations in and around the first island chain would also lower tensions. Efforts on those fronts should be encouraged, but they are unlikely to produce results in the foreseeable future given the perceived stakes, conflicting interests and absence of good-will. In the interim, it is incumbent on the leaders of the world’s two leading powers to develop better ways to contain moments of crisis and high tension. The improved implementation of some crisis management mechanisms, and the expansion of others, is likely to be the best way to do this.
For starters, the two governments should continue to use the existing MMCA platform and Rules of Behaviour, emphasising the importance of both, internally, to their own bureaucracies. Limitations notwithstanding, these mechanisms remain the best vehicles for helping the two militaries reach a common understanding of what safe encounters are and for creating accountability for unsafe behaviour. The MMCA’s focus on improving operational safety is important to maintain given that no other platform addresses safety issues (whereas many discuss policy differences and security concerns). The inauguration of the Policy Dialogue System, which places periodic MMCA consultations within a framework that includes dialogues focused on policy issues, may help address Beijing’s reservations about delinking operationally focused discussions from a broader policy conversation that allows them to air their objections to Washington’s military presence in the region.
As for the Rules of Behaviour, Washington and Beijing are unlikely to develop – through bilateral channels – either more detailed or legally binding rules that improve operational safety. The two parties could, however, pursue regular multilateral discussions that review compliance with existing international rules and norms more broadly, including those found in COLREGs, the Chicago Convention, CUES and UNCLOS, and, through that process, reduce the ambiguity surrounding terms and definitions. Raising these issues in multilateral channels could help depoliticise discussions and has the potential to appeal to Beijing’s regional interests. While the PLA presence off the U.S. coast is limited, it is increasing in the waters and skies off the shores of its East Asian neighbours. China, like the U.S., will thus likely have an interest in cultivating a degree of predictability for such operations. Such an approach is unlikely to produce binding new commitments, but it could help further enmesh the two parties and the region in existing commitments.
Review of the existing norms for military aircraft encounters would be particularly useful given that binding rules specific to such encounters do not exist in any international convention. Discussions could take place in the Association of Southeast Asian Nations Defence Ministers Meeting Plus mechanism, or ADMM-Plus, which includes defence ministers of the ten South East Asian nations and its dialogue partners China, the U.S., Australia, India, Japan, New Zealand, South Korea and Russia. In 2018, the defence ministers of South East Asia adopted the first multilateral, non-binding guidelines for encounters between military aircraft. Singapore, the chair of the 2018 discussions, could float the idea of expanding adoption to include the eight ASEAN dialogue partners.
In the same vein, talks about how to determine what constitutes a “safe distance” between vessels in various scenarios could take place in the Western Pacific Naval Symposium, the forum where the CUES was developed. That platform comprises more than twenty navies, including those of China, the U.S., Australia, Japan, Korea, Russia and Singapore.
In the spirit of reinforcing reliance on existing tools, the two sides should also recommit both internally and bilaterally to making regular use of the Defense Telephone Link, which proved to be an effective crisis prevention mechanism when concerns about a potential U.S. attack in the Spratlys emerged in Beijing in 2020. As noted above, each side is supposed to provide 48 hours’ advance notice before a requested call and respond within 24 hours of receiving the notice. Beijing and Washington might try enhancing the crisis prevention utility of the telephone link by abbreviating these intervals, perhaps halving the advance notice requirement period to 24 hours and the response time to twelve hours. Efforts to create new hotlines are unlikely to produce results or to be useful during a crisis, because of the limitations previously raised.
As for the dialogue formats that have been created over the years, the two sides could take several useful steps to make the most of them. First, they should capitalise on the momentum created by the April minister-level call by organising a meeting between Austin and Wei at the June Shangri-La Dialogue. That meeting would be an opportunity for the sides to commit privately to the Policy Dialogue System as part of a larger common objective – to shield defence dialogues from the political volatility, so that, as China proposed in 2017, military-to-military ties may serve as a “stabilising force” in the overall relationship. As noted, the System could prove a useful framework for mitigating Chinese reservations over discussions related to risk reduction and crisis management mechanisms. While the U.S. believes the Policy Dialogue System – created in the Trump administration’s final months – is still in place, it is unclear whether China shares that understanding.
Having reaffirmed their commitment to the system, the two sides should then resume engagement across all levels. Discussions in the MMCA and the Defense Policy Coordination Talks (at the U.S. deputy assistant secretary of defense and Chinese deputy director of the Office for International Military Cooperation level), which took place in 2021, are critical to maintain. Officials should also resume discussions at the under secretary-PLA deputy chief of general staff level, in the Crisis Communications Working Group and in the Joint Staff Dialogue.
Given current levels of distrust between Washington and Beijing and the potential for policymakers to misread the intentions of the other side when tensions spike, the two sides should actively use the Joint Staff Dialogue Mechanism and the Crisis Communications Working Group to develop a better understanding of each other’s perspectives and approaches to crises. The Joint Staff Dialogue Mechanism, which has not met since 2017, and convenes the two militaries in discussions on crisis mitigation, and the Crisis Communications Working Group, which last met in 2020, are the only two dialogues that explicitly address crisis prevention and communications. That Beijing agreed to establish these dialogues is a good sign, suggesting that it is increasingly open to talking about how to manage crises even as it remains non-committal about actions that reduce risk for U.S. military operations.
Beyond restarting these dialogues, U.S. officials should seek to include simulations and table-top exercises as part of these discussions. Simulations are useful for identifying particular triggers of unintended escalation. In addition to their information-sharing and educational value, they could also motivate each government to reflect on and clarify its own internal protocols during a crisis. If, given the current political environment, official discussions at this level of specificity are impossible, the two governments could coordinate and empower crisis simulation discussions at the Track 1.5 level.
Finally, even as it seeks to reinvigorate and enrich dialogue in various formats, the U.S. will need to manage internal expectations of what this will produce. Beijing will likely continue to be less transparent than Washington wishes and to dispatch representatives with less decision-making authority than their counterparts; these moves reflect Chinese bureaucratic culture and structure as much as the degree of importance Beijing attaches to its relationship with Washington. Nor will Chinese representatives bend easily to U.S. remonstrations, no matter how much the U.S. may feel that it is in the right. As a former U.S. official put it, “If the yardstick [for dialogue] is that China admits they are wrong and they start following U.S. preferences, you’ll never have success”.
For its part, Beijing should be aware of how its approach to dialogue feeds perceptions in Washington that talking is no longer worthwhile. The less it seizes opportunities for meaningful engagement with Washington, the greater the chance that China’s actions will be misconstrued, and Chinese perceptions and interests discounted in U.S. decision-making.
In sum, each side should be clear-eyed that dialogue is unlikely to produce desired changes in longstanding policies or behaviours on the other’s part and both should avoid making such change to the metric for success. Rather, the sides should look at these exchanges as an opportunity to facilitate regular temperature-taking, clearer signalling of strategic intent and information collection, all of which can help manage growing frictions in the relationship.
V.Conclusion
The current level of risk in the China-U.S. relationship is not a momentary spike in tensions but a feature set to endure for the foreseeable future. The overall shift from engagement to strategic competition, combined with expanding military deployments, makes it especially important for the two governments to commit themselves to strengthening existing mechanisms and techniques for preventing crises and avoiding conflict. However improbable a major unintended incident may seem, such an event is all too possible, and the associated risks would be grave.
Crisis management remains a challenge because of the divergent preferences and approaches of the two governments. The mechanisms that Washington and Beijing have in place have not failed and in all likelihood have helped normalise safer operational practices. Nevertheless, their limitations, which have become evident over the years, should be taken into account when considering ways forward. Washington has historically taken up the task of designing and proposing crisis management mechanisms and it is likely to keep doing so. But it is also Beijing’s responsibility, and in its interests, to share the creative burden so that both governments have confidence that these mechanisms will ward off an escalation that neither side desires, and that could be disastrous for international peace and security.
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