The US and China have been in an on-going trade war since 2018. In academic circles, it has been argued that this conflict may as well be the Second Cold War. Critically evaluate the future world order with main actors as China, Russia and the US.

Introduction

In his speech at Fulton, Missouri, in March 1946, Winston Churchill warned: "From Stettin in the Baltic to Trieste in the Adriatic, an iron curtain has descended across the Continent." That speech is often remembered as the start of the Cold War. Since 2018, when the United States began imposing tariffs on Chinese goods, many scholars have asked whether a new curtain, this time made of tariffs, chips and alliances, is descending between the US and China. Russia's invasion of Ukraine and its "no limits" partnership with China have strengthened this view. Yet today's rivalry differs from the old Cold War in important ways, and the future world order is likely to be more complex than a simple division into two camps.

Overview

In July 2018, the Trump Administration imposed tariffs under Section 301 on Chinese goods, citing unfair trade practices and theft of intellectual property; by 2019, tariffs covered about US$360 billion of Chinese imports, and China retaliated. The Phase One deal of January 2020 paused escalation, but China met only part of its purchase commitments. The rivalry then moved to technology: the US placed Huawei on its Entity List in 2019, passed the CHIPS and Science Act and imposed sweeping export controls on advanced semiconductors in October 2022. In 2025, tariffs between the two briefly rose above 100 per cent before a truce in Geneva in May and a deal between Presidents Trump and Xi in Busan in October 2025 eased them.

Is it a Second Cold War? A critical evaluation

1. For: ideological rivalry.

The US frames the contest as democracy versus autocracy, while China promotes its own governance model and rejects Western "universal values". (Reference: The White House, National Security Strategy, October 2022; Xi Jinping's report to the 20th Party Congress, October 2022.)

2. For: military competition and alliances.

The US has built new security partnerships such as AUKUS and the Quad, while China expands its navy and nuclear arsenal and presses its claims in the South China Sea and on Taiwan. (Reference: AUKUS Leaders' Statement, 15 September 2021; US Department of Defense, China Military Power Report 2024.)

3. For: technology blocs.

Export controls, bans on Huawei and TikTok, and rival standards for 5G, AI and chips are dividing the world into competing technology spheres. (Reference: US Bureau of Industry and Security, export control rules of 7 October 2022 and later updates; CHIPS and Science Act, 2022.)

4. For: the China-Russia alignment.

The joint statement of 4 February 2022 declared a partnership with "no limits", and China has supported Russia's economy during the Ukraine war, recalling the Sino-Soviet bloc. (Reference: Joint Statement of the Russian Federation and the People's Republic of China, 4 February 2022.)

5. Against: deep economic interdependence.

Unlike the US and the Soviet Union, which barely traded, the US and China still traded goods worth more than US$580 billion in 2024 and are deeply linked through supply chains and finance. (Reference: US Census Bureau, trade in goods with China, 2024.)

6. Against: no global ideological crusade.

China does not seek to export communist revolution as the Soviet Union did, and it trades with democracies and autocracies alike. (Reference: Odd Arne Westad, "The Sources of Chinese Conduct", Foreign Affairs, 2019.)

7. Against: shared global problems.

Climate change, pandemics, financial stability and nuclear risks require US-China cooperation, as seen in their climate statements of 2021 and 2023. (Reference: US-China Joint Glasgow Declaration, November 2021; Sunnylands Statement, November 2023.)

8. Against: a multipolar Global South.

Unlike in the 1950s, most countries, including India, Brazil, Turkey, the Gulf states and Indonesia, refuse to join either camp and deal with both. (Reference: UN General Assembly voting on Ukraine resolutions, 2022–2023; Ivan Krastev and Mark Leonard, Living in an à la carte world, ECFR, 2023.)

The future world order with China, Russia and the US

1. US primacy under strain.

The US remains the leading military, financial and technological power, but its share of world output has declined and domestic polarisation and tariffs strain its alliances. (Reference: IMF, World Economic Outlook database; Joseph Nye, Is the American Century Over?, 2015.)

2. China's rise as a peer competitor.

China is the world's largest manufacturer and trading nation and, by purchasing power parity, the largest economy, giving it the capacity to shape rules in Asia and beyond. (Reference: World Bank, World Development Indicators; IMF, WEO, GDP at PPP.)

3. Russia as a disruptor and junior partner.

Russia's nuclear arsenal and energy resources make it a major actor, but its smaller economy and the costs of the Ukraine war make it increasingly dependent on China. (Reference: SIPRI Yearbook 2025; IEA, Russia energy export data.)

4. Competing institutions.

Alongside Western-led bodies like the G7 and NATO, China and Russia lead the SCO and an expanded BRICS, and China funds development through the Belt and Road Initiative and the AIIB. (Reference: SCO and BRICS declarations, 2023–2025; Asian Infrastructure Investment Bank Articles of Agreement, 2015.)

5. A fragmented economy and tech decoupling.

The IMF warns that geoeconomic fragmentation could reduce global output by up to 7 per cent in the long run, as trade, investment and technology split into blocs. (Reference: IMF Staff Discussion Note, Geoeconomic Fragmentation and the Future of Multilateralism, January 2023.)

6. Flashpoints of Taiwan and Ukraine.

A crisis over Taiwan could bring the US and China into direct conflict, while the Ukraine war has already locked the West and Russia into long-term confrontation. (Reference: Graham Allison, Destined for War: Can America and China Escape Thucydides's Trap?, 2017; CSIS war-game report The First Battle of the Next War, 2023.)

7. The rise of middle powers.

India, the EU, Japan, Saudi Arabia, Turkey and Brazil will act as swing states, making the order "multiplex" rather than strictly bipolar. (Reference: Amitav Acharya, The End of American World Order, 2nd edition, 2018.)

8. Managed rivalry or conflict.

The most likely future is competitive coexistence: rivalry in technology and security, limited cooperation on global issues, and periodic truces, as in the 2025 trade deals, unless a crisis escalates. (Reference: White House and Chinese Ministry of Commerce statements on the Geneva and Busan trade arrangements, May and October 2025.)

Implications for Pakistan

For Pakistan, a world of great-power rivalry carries both risks and opportunities. Its strategic partnership with China and CPEC may attract US pressure, while its economy depends on Western markets and the IMF. Pakistan must avoid becoming a battleground for rival blocs, keep balanced ties with Washington, Beijing and Moscow, and use its geography for geo-economic connectivity, as its National Security Policy recommends.

Conclusion

In his American University speech of June 1963, President John F. Kennedy said: "If we cannot end now our differences, at least we can help make the world safe for diversity." The US-China trade war has features of a new Cold War: ideological rhetoric, military rivalry and technology blocs. But deep interdependence, shared global problems and the independence of the Global South make it a different kind of contest. The future world order is likely to be multipolar and fragmented, with the US and China as the main poles and Russia as a dangerous but dependent partner of China. Whether it remains peaceful depends on whether the great powers learn, as Kennedy urged, to make the world safe for diversity.