The rise of China and Beijing’s assertive foreign policy under Xi Jinping are fundamentally changing the geopolitical landscape in the Indo-Pacific. Specifically, a more confident China is perceived in Washington as destined to challenge U.S. supremacy in the region for the past seven decades. The Thucydides Trap, as the emerging rivalry between a rising power and the reigning one, carries significant risks in that failure of conflict management could well result in major clashes between the two countries and, as a consequence, place regional peace and stability in peril. This chapter reviews a range of areas where Sino–U.S. rivalry exists and analyses the likely scenarios and policy options for both Washington and Beijing. It argues that U.S.–China rivalry can take a number of different forms, not all of which would end in military confrontation, with the exception of Western Pacific where the two militaries are engaging in growing overlapping and close-range encounters. Both powers recognize the stakes and are making efforts to manage their differences and minimize the impact of conflicts.
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