China's diplomatic focus should be its neighbouring countries

For a long time, relations with the United States have been a cornerstone of China’s diplomatic priorities, writes ANBOUND Research Fellow for Geopolitical Strategy Zhou Chao.

The easing of US-China relations and the formal establishment of diplomatic ties between the two nations have played a pivotal role in China’s reform and opening-up. With the support and recognition of the US within certain limits, China’s integration into the global economic, technological, and financial systems dominated by the US and the West became increasingly possible. The influx of capital and technology from the US and the West has also been a major driving force behind China’s economic and technological rise.

However, in recent years, the growing tensions in US-China relations have become a key factor in the deterioration of China's ties with both the US and the West. A series of actions by the US have posed significant challenges to China’s interests in various third-world countries. In light of these challenges, it seems clear that improving diplomatic relations with the US remains critical. Yet, for China to safeguard its global standing and overseas interests, it will require a greater focus on strengthening relations with its neighboring countries, particularly over the next three to five years.

First, deepening and optimizing diplomatic relations with neighboring countries has become an imperative in the era of de-globalization. The previous phase of globalization, driven largely by capital and narrowly focused on economic interests, is showing signs of strain. Despite its initial promises, globalization has failed to address the growing gap between rich and poor—both within and between nations—leading to widespread dissatisfaction. Moreover, the full promotion of globalization has not succeeded in bridging cultural and ideological divides; rather, it has intensified them. The migration flows caused by globalization have led to backlash in developed countries, fueling the rise of right-wing populism. The global economic system, increasingly reliant on complex industrial and value chains, has also proven highly vulnerable to major disruptions such as pandemics, natural disasters, or regional conflicts. Regionalization is now the dominant trend, with major powers shifting their focus back to their geographically proximate areas. After Donald Trump’s presidency, for instance, his demands for Denmark to cede Greenland and for Canada to join the US underscored a broader geopolitical shift.

Second, the escalating challenges in China’s neighboring countries suggest that its interests in the region are increasingly under threat. In Pakistan, a critical partner in the Belt and Road Initiative (BRI), growing separatist activities, along with rising anti-China sentiment, are exacerbating instability. Pakistani authorities, struggling with internal political divisions and limited resources, face difficulties in managing the situation, while the Gwadar Port project has experienced disappointing results for China. In Myanmar, intensifying conflict between local armed groups and the military government is jeopardizing China’s interests, and in Cambodia, the future of the major canal project backed by Chinese investment is uncertain, with U.S. and Japanese capital poised to take over. In the South Sea, disputes over territorial claims continue to strain relations with the Philippines and Vietnam, which maintain confrontational stances. Tensions in the region could escalate at any time.

In northern China, challenges such as terrorism and social unrest in Central Asia continue to pose significant risks. Recently, Russia has introduced strict checks on goods along the China-Europe Railway, particularly targeting dual-use military and civilian items. Additionally, Russia’s plans to build a bridge over the Tumen River, potentially obstructing Chinese vessels, are another development that warrants attention. These actions, along with Russia’s long-standing efforts to undermine China’s regional infrastructure projects, underscore the importance of closely monitoring the geopolitical dynamics in these neighboring regions.

Third, the relative reduction in US attention to the region provides China with an opportunity to strengthen its influence. Trump’s victory speech and subsequent actions have indicated that domestic concerns will be the primary focus of the U.S. government. Recently, proposals such as offering civil servants a “buyout” of their years of service have encountered resistance, and efforts to reorganize the government seem likely to face challenges. As the US government shifts its focus toward internal matters, its foreign policy resources may be reduced, with particular emphasis on the Americas. In this context, the U.S. is likely to adopt a more opportunistic approach to China’s regional issues, using offshore balancing to exert influence while limiting direct involvement. For China, this shift represents an important opportunity to further assert its influence in its neighboring regions.

China faces a far more complex regional situation than the US, with its major interests concentrated in neighboring countries, whose relationships are increasingly strained. As the US retracts, China should focus more on diplomacy with its neighbours over the next three to five years, prioritizing the resolution of key regional challenges.

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