The Vital Triangle: China, the U.S. and the Middle East

"If China is winning, the United States must be losing." That is precisely the principle that many Americans see at work not only in the world, but also in the Middle East. China's surging manufacturing capacity has contributed to the steep decline in manufacturing jobs in the United States. U.S. businessmen worry about the consequences of Chinese firms taking over U.S. firms such as Unocal and 3Com and scuttle the deals. U.S. bankers agonize over China's massive current accounts surpluses and its huge dollar holdings. Many perceive China to be a military threat too, expanding its reach in the Pacific and threatening the Pax Americana that has been in force there for decades.

The Middle East is not at the center of U.S. concerns about China, but it is certainly a part of them. The region holds the world's largest repository of oil reserves and was a longtime Cold War battleground between the United States and the Soviet Union. The United States has been intensively engaged in the Middle East for more than a half century in an effort to maintain stability and ensure the free flow of oil out of the Persian Gulf. European nations have acquiesced to the U.S. lead, in part because they recognize that they cannot secure their interests in the ways that the United States does.

China, however, has felt less of a burden to comply with U.S. wishes, and the government often sees a range of reasons to depart from the U.S. script. Far more than the United States, China is dependent on Middle Eastern oil. More than 50 percent of China's imported oil comes from the Middle East, versus some 25 percent in the United States. Further, China's oil needs are growing, while U.S. oil consumption has flattened. China's strategic thinkers see the country's continued reliance on Middle Eastern oil to be a strategic liability, not only because the Middle East itself is an unstable region, but also because they have little faith in their own ability to secure the sea lanes needed to transport the oil in the event of tensions with the United States.