Tensions between the United States and China are expected to remain high for years to come. In the United States, the negative view of China is bipartisan and shared by the population. And to some extent, Democrats and Republicans are competing over who is tougher on China. On the Chinese side, it is also unlikely to give in to US demands for change. China believes its system is more effective in solving problems and meeting challenges and it comes from a collectivist origin that dates back thousands of years, of which China is increasingly proud. He considers that the capitalist model of the United States fails to solve the key problems of society.

While we don’t expect the Biden administration to take disruptive steps, such as a new trade war, the path of gradual decoupling measures such as increasing tech restrictions on China and self-sufficiency in new sectors (like biotechnology) is plotted to continue. Human rights penalties may also increase. China will work towards decoupling by seeking more autonomy and investing heavily in technology and increasing energy and food security. Tensions are also expected to remain high around Taiwan where a new status quo with a very high level of tension is the new normal.

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