Is the world entering a new Cold War driven by US-China rivalry?

In March 2025, China announced a 7.2% increase in its official defense budget, reaching approximately $245 billion. The Pentagon's 2024 China Military Power Report highlights that Beijing has tripled its defense spending over the past decade and projects the PLA will field 1,000 nuclear warheads by 2030. The report also details China's rapid naval expansion, noting it now possesses the world's largest fleet by hull count, with active construction of aircraft carriers and advanced destroyers aimed at challenging US maritime dominance in the Indo-Pacific.

The AUKUS trilateral security pact, established in 2021 and expanded in 2024-2025, represents a direct military-technological response to China's rise. Under the agreement, the US and UK will provide Australia with nuclear-powered submarines by the early 2030s, while jointly developing hypersonic weapons and quantum computing capabilities. US officials have explicitly framed AUKUS as defensive, aimed at preserving the 'rules-based order' in the Pacific. However, Chinese state media and officials have condemned the pact as an 'Asian NATO' designed to encircle Beijing, citing the agreement's focus on countering PLA naval expansion in the South China Sea and Taiwan Strait.

According to the Quincy Institute for Responsible Statecraft's 2024-2025 database, the United States operates approximately 750 military bases across 80 countries, while China maintains only one overseas base in Djibouti. Scholars argue that Washington's 'defensive' narrative ignores its global military footprint, which includes 11 carrier strike groups and 170,000 troops deployed in the Indo-Pacific alone. Beijing's overseas presence is primarily economic—the Belt and Road Initiative has funded over 3,000 infrastructure projects in 150 countries, many welcomed by Global South nations as alternatives to Western conditional loans. The asymmetry in military basing undermines the claim that the US is merely responding to Chinese aggression.

A 2025 study published in the Journal of International Economic Law argues that US export controls on advanced semiconductors, introduced in October 2022 and tightened in 2024-2025, violate WTO non-discrimination principles and are designed to prevent China from achieving technological self-sufficiency. The study notes that US restrictions on Huawei and SMIC were imposed without public evidence of wrongdoing, contrasting with the US's own use of Chinese telecom equipment in rural networks. Economist and former World Bank official Justin Yifu Lin testified that the US-China trade relationship, valued at over $700 billion annually, makes a Cold War comparison ahistorical—unlike the Soviet Union, China is deeply integrated into global supply chains and has no interest in overturning the capitalist system, only in reforming its governance structures.