[2026 New Year Special Visible Commentary] ① 2026 US-China Relations Outlook: Adjustment of Core Interests and a Transitional Period for Civilizational Leadership

YouTube link: https://www.youtube.com/watch?v=UnEV5J6UAvM

Video Script

2026 East Asian International Relations Outlook: Focusing on US-China Relations

Today, we have arranged a session to gain in-depth insights into the international affairs of 2026 with Chairman Ha Young-sun of the East Asia Institute. The year 2025 has been a year of significant upheaval, both domestically and internationally. Particularly in terms of international relations, the global order and ROK-US relations have undergone substantial changes following the emergence of a second Trump administration. The announcement of the National Security Strategy by the White House in December, outlining the US's foreign and security strategy, suggests considerable changes are anticipated. Throughout this year, significant shifts are expected on a global scale, within the Indo-Pacific order, and on the Korean Peninsula.

Consequently, South Korea faces the challenge of actively responding to these changes. Therefore, we will begin by asking Chairman Ha Young-sun for his views on the overall direction of the international order this year. We will first inquire about the evolving US foreign and security strategy and, consequently, how the global order and US-China strategic competition will unfold this year. Welcome. Around this time next year, we will be looking back at the past year and discussing prospects for the coming one. However, this is never an easy task, and I always remain cautious about how accurately I have predicted the past year. Forecasting the year 2026 also appears to be a difficult undertaking.

As Director Jeon Jae-seong mentioned, numerous changes have already occurred in 2025, and as we look at the year ahead shaped by these developments, the core questions ultimately revolve around what changes I, or the Korean Peninsula, or the Asia-Pacific region encompassing the Korean Peninsula, will experience? And what will be the consequences for my life? This is likely the crux of the issue. The first aspect is the global outlook. When discussing the global outlook, if one starts with the United States and China, as is customary, it's for simple indicators: the US still accounts for approximately $30 trillion out of the world's $120 trillion GDP, and China accounts for about $20 trillion. Together, they represent nearly half of the global GDP. In terms of military power, global military expenditure is around

$2.7 trillion. Although last year saw particularly high spending, the US alone exceeded $1 trillion, followed by China with over $300 billion. Therefore, the nature of the relationship between these two countries remains critically important. One might think this is easy to grasp, but in reality, amidst the mix of real and fake news on a global scale, what are the genuine facts? And how to navigate the trends based on them is not a simple task. Therefore, my intention is not to offer a forecast based on specific hopes or expectations, but rather to provide a minimal forecast based on primary data close to cold reality. In this context, regarding US-China relations, there was a brief meeting at APEC at the end of 2025, and a US-China summit is expected as early as April. However, based on their respective foundational documents and official statements,

my impression is that the year ahead can be characterized as a period of adjustment for the core interests of both nations. This is because, even with the summit in April and the year progressing, the question of what constitutes each nation's core interests is not entirely clear. My approach has been to examine relatively recent materials produced by both sides, which reveal their underlying intentions rather than mere propaganda, to forecast the US-China relationship for the year.

US National Security Strategy and Core Interests

Firstly, regarding the United States, as discussed last year, the National Security Strategy report released in late November is of primary importance. To summarize, their core interests can be broadly categorized into approximately five areas, which are expressed throughout the report. As many have pointed out, the US will prioritize its homeland and the Western Hemisphere. This element, in a 21st-century sense, is reminiscent of the Monroe Doctrine and constitutes the first part. What interests us most is the second part. This section, which appears on a four-year cycle, is dedicated to Asia. Although it was released slightly later than the previous one, Asia receives significant attention, second only to the US homeland and Western Hemisphere. The report clearly outlines their objectives in Asia: primarily, to ensure the US does not fall behind China in terms of economic future, or rather, to dominate China. Within this context, the second major concern is how to prevent military conflict. The report details various efforts to prioritize the US economy in areas such as trade and supply chains, and emphasizes pursuing these goals not unilaterally but in conjunction with allies and partners. Concurrently, and with almost equal emphasis, preventing military conflict is presented as a core interest. Therefore, compared to previous national strategy reports, the language used is somewhat more cautious. The third section addresses Europe. Reading this report, one encounters rather harsh assessments. It suggests that if Europe continues on its current trajectory, it will no longer be at the center of the global stage in 20 to 30 years. It warns that Europe must wake up.

This is a stark assessment. The report also states that the era of Middle Eastern dominance has passed. The US is now an energy-independent nation, and therefore, expectations that the Middle East will continue to be the focus of global attention and that the US will engage in comprehensive activities centered on its core interests there should be tempered. Compared to these harsh assessments of Europe and the Middle East, the report's cautious approach towards Asia warrants particular attention. The fifth point concerns technology, specifically advanced technologies. The report highlights AI, biotech, and quantum computing as areas where the US must maintain its global leadership. These are presented as the five representative core interests. My intention in comparing these with China's objectives is to understand how the next year, characterized as a period of adjustment for both nations' core interests, will unfold. It is crucial to understand which areas are central. Among the five areas mentioned, Asia holds the second-highest priority, significantly so, compared to Europe and the Middle East. Understanding China's core national interests is also important. Typically, at the end of the year, leaders like Xi Jinping and Wang Yi of China reflect on the past year and look ahead in their year-end remarks. However, I have not observed such interviews or public statements recently. As I have read through various materials, I have pondered how China views the world and its future trajectory.

China's 15th Five-Year Plan and Xi Jinping's Strategy

I regularly review Chinese documents with an eye toward 2026, 2035, and 2050. What particularly caught my attention was the 15th Five-Year Plan, finalized at the Fourth Plenum in November. This plan will guide China's development for the next five years, starting next year. The final draft is expected to be approved at the National People's Congress next spring, after which the five-year period will commence. In finalizing this plan, Xi Jinping personally emphasized seven key areas, outlining the direction for the five-year plan. I have listed these seven points. Reflecting on these seven points, I considered the upcoming 2027 21st Party Congress, similar to the US midterm elections next year. Unlike previous terms, Xi Jinping, who was originally expected to step down after ten years in government, has extended his tenure by five years, to 2027.

If he steps down then, his tenure would extend until 2031. Therefore, he must provide a compelling justification for why he must continue, and why an additional five years is necessary. This appears to be his primary concern. Consequently, in my view, the first two of the seven points strongly convey this nuance. Why is the period from 2027 onwards, coinciding with the 15th Five-Year Plan, so significant? It is crucial for achieving the goal of socialist modernization by 2035 and ultimately establishing China as a preeminent global power by 2049. This plan is vital for that endeavor. Therefore, to ensure its smooth progression, he must articulate the necessity of his continued leadership. The second point outlines the central objective: to achieve the status of a moderately developed country. This is the goal of the 15th Five-Year Plan.

What we need to examine closely are points 3 and 4. As you know, plans are made every five years. The 14th Five-Year Plan was released in 2022. What differs and what remains the same compared to that plan? Looking at points 3 and 4, the general topics are similar. However, their emphasis appears to have shifted. Reflecting on China's experiences over the past five years, the third topic, 'Scientific and Technological Self-Reliance and Strength,' remains crucial. As we know, given the turbulent period of the last five years, particularly concerning AI and semiconductors, achieving self-reliance and strength in these areas was a key topic in the 14th Five-Year Plan and remains the foremost priority in the 15th. The second topic, first introduced in the 14th Five-Year Plan, is 'dual circulation,' which posits that domestic and international economic circulation must mutually reinforce each other to thrive. Simply put, there appear to be three core elements: first, the issue of self-reliance and strength in advanced science and technology; second, the domestic economy; and third, the integration of the domestic and international economies.

Over the past five years, China has encountered challenges and reached conclusions. While scientific and technological self-reliance and strength remain paramount, the past five years have seen some progress in this area. The US targeted this as a core issue, but China has found ways to overcome these limitations. Therefore, in the 15th Five-Year Plan, while emphasizing these three fundamental elements, particular focus is placed on the international economic circulation. Given the current US administration, this aspect may prove challenging. Consequently, relatively more emphasis is placed on the domestic circulation component. The assumption is that if the global economy remains dynamic, these issues can be managed. This represents the forecast for this year. The fifth point addresses equality, a perennial concern. The sixth and seventh points reflect personal will. The sixth point concerns economic reform, but crucially emphasizes security and value. Development and security are inseparable.

While terms like 'peaceful development' have been used before, the emphasis on security remains. The final point asserts personal leadership: 'I must lead.' 'I will lead the party in a manner that I direct.' This provides a general outline of how things might unfold in 2026, considering the US's core interests, as articulated by Trump leading up to the midterm elections, and Xi Jinping's seven priorities leading up to the 21st Party Congress in 2027. The trajectory for 2026 appears relatively clear. From the US perspective, it aims to maintain leadership in advanced science and technology and to outcompete China in specific areas of trade and supply chains, in collaboration with allies and partners. China, rather than confronting the US unilaterally or conceding, plans to navigate these challenges by integrating the three elements, drawing on its experiences over the past five years. Both nations are facing elections, which means domestic political considerations will inevitably influence their actions. National security will remain a paramount concern. This may manifest in cautious approaches to issues like Taiwan, as neither the US nor China can afford to appear weak heading into elections. While there are areas of potential principled agreement and coexistence, significant breakthroughs in 2026 are unlikely. This could be a concluding assessment, but I feel compelled to add that when observing domestic and international forecasts for the US and China, I often feel a sense of frustration. Viewing 2026 solely through the lens of its immediate events makes it difficult to accurately assess the future global order shaped by US-China relations. How, then, should we proceed? Efforts are needed to understand 2026 as a mid-term juncture. In this context, how should we interpret the significance of the careful adjustments to each nation's core interests in the coming year, assuming no major disruptions or achievements?

This perspective considers developments up to approximately 2031, while Trump's focus is on his potential second term or subsequent Republican administrations. Crucially, from a historical perspective, 2026 holds significance as a period of leadership transition and the emergence of a new order. The question arises: what is the role of 2026 in this context? Experts often frame this as a period of relative US decline and relative Chinese ascent, marking a transition from a unipolar to a multipolar system. Is this accurate?

In my view, what does 2026 represent? From the perspective of leadership cycles, it is difficult to characterize it as a definitive relative decline for the US, nor as a decisive rise for China. Paradoxically, the popular narratives of 'peak China' or 'peak USA' both have limitations. The US is striving, albeit cautiously, to mitigate its relative decline compared to the perceptions of China, Russia, or North Korea. Conversely, the notion that China has rapidly ascended to the center of the global stage is also a statement that requires careful consideration. Therefore, how should we ultimately understand this and shape our foreign policy and approach to the world order? In the long term, this issue is tied to mid-term leadership cycles. In the long run, it is connected to civilizational shifts. Ultimately, who occupies the center stage will be determined not just by 2050, but perhaps further into the future.

While the term 'peaceful development' was frequently used before, it still emphasizes the aspect of security. Lastly, 'I must do it myself.' 'I will lead the party I lead.' If we align what Trump is thinking about the five core issues ahead of the midterm elections with what Xi Jinping is planning for the seven imperatives ahead of the 21st Party Congress in 2027, we can roughly foresee how things will unfold without much difficulty by 2026. From the U.S. perspective, it must maintain leadership in advanced science and technology. In the economic sphere, it will attempt to surpass China in appropriate areas such as trade and supply chains, in conjunction with allies and partners. China, rather than confronting unilaterally or yielding unilaterally, appears to be planning to navigate these challenges by integrating the three elements mentioned earlier, based on the experiences of the past five years. Both sides are

facing elections, domestic political considerations make security guarantees inevitably important. When these become concrete, for example, in the cautious handling of issues like Taiwan, neither the U.S. nor China can easily adopt a soft stance ahead of elections. Furthermore, while there are elements of coexistence that can be agreed upon in principle, it is unlikely that these will become prominently visible by 2026. This could be a possible conclusion. However, what I find frustrating when looking at domestic prospects within the U.S. and China, and even global prospects, is that viewing 2026 on its own terms makes it difficult to accurately forecast the world order that the U.S. and China will create. So, what is the alternative? We need to strive to view 2026 as a medium-term perspective. In this context, the core national interests of both countries, which are being cautiously navigated this year,

Historical Context of 2026: Leadership Transitions and a New Order

The qualities required of leaders are changing. The modern era, where military strength and economic prosperity were sufficient, has given way to a demand for leaders with more complex capabilities. This signifies the advent of a new civilization. My own view is that this civilizational shift demands approximately six key qualities. Among these, rapid advancements in technology and political leadership, or governance capabilities, are emerging as critical factors in the decentralized economy. Whichever entity possesses these qualities will likely ascend to the center stage. Therefore, if the US, awakening to this reality post-Trump, seeks to accelerate its progress, it will face challenges. Conversely, even with a rare opportunity, China may struggle to place a collective that meets these demands at the forefront. I wish to emphasize this point. The six qualities I mentioned, when viewed over the longer term, extending into the latter half of the 21st century, include: first, the capacity to maintain ecological balance and exert influence in environmental matters; second, cultural influence, encompassing the creative influence required to shape one's way of life. Therefore, while short-term forecasts of US-China relations in 2026 are possible, we must remain vigilant about the potential for rapid changes driven by factors beyond military and economic might, such as new technologies, leadership, and governance capabilities. Looking further ahead from 2026, we must consider that leaders possessing environmental stewardship and cultural influence will ultimately occupy the center stage. This is my personal perspective.

The qualities required of leaders are changing. The modern era, where military strength and economic prosperity were sufficient, has given way to a demand for leaders with more complex capabilities. This signifies the advent of a new civilization. My own view is that this civilizational shift demands approximately six key qualities. Among these, rapid advancements in technology and political leadership, or governance capabilities, are emerging as critical factors in the decentralized economy. Whichever entity possesses these qualities will likely ascend to the center stage. Therefore, if the US, awakening to this reality post-Trump, seeks to accelerate its progress, it will face challenges. Conversely, even with a rare opportunity, China may struggle to place a collective that meets these demands at the forefront. I wish to emphasize this point. The six qualities I mentioned, when viewed over the longer term, extending into the latter half of the 21st century, include: first, the capacity to maintain ecological balance and exert influence in environmental matters; second, cultural influence, encompassing the creative influence required to shape one's way of life. Therefore, while short-term forecasts of US-China relations in 2026 are possible, we must remain vigilant about the potential for rapid changes driven by factors beyond military and economic might, such as new technologies, leadership, and governance capabilities. Looking further ahead from 2026, we must consider that leaders possessing environmental stewardship and cultural influence will ultimately occupy the center stage. This is my personal perspective.

The qualities required of leaders are changing. The modern era, where military strength and economic prosperity were sufficient, has given way to a demand for leaders with more complex capabilities. This signifies the advent of a new civilization. My own view is that this civilizational shift demands approximately six key qualities. Among these, rapid advancements in technology and political leadership, or governance capabilities, are emerging as critical factors in the decentralized economy. Whichever entity possesses these qualities will likely ascend to the center stage. Therefore, if the US, awakening to this reality post-Trump, seeks to accelerate its progress, it will face challenges. Conversely, even with a rare opportunity, China may struggle to place a collective that meets these demands at the forefront. I wish to emphasize this point. The six qualities I mentioned, when viewed over the longer term, extending into the latter half of the 21st century, include: first, the capacity to maintain ecological balance and exert influence in environmental matters; second, cultural influence, encompassing the creative influence required to shape one's way of life. Therefore, while short-term forecasts of US-China relations in 2026 are possible, we must remain vigilant about the potential for rapid changes driven by factors beyond military and economic might, such as new technologies, leadership, and governance capabilities. Looking further ahead from 2026, we must consider that leaders possessing environmental stewardship and cultural influence will ultimately occupy the center stage. This is my personal perspective.

The qualities required of leaders are changing. The modern era, where military strength and economic prosperity were sufficient, has given way to a demand for leaders with more complex capabilities. This signifies the advent of a new civilization. My own view is that this civilizational shift demands approximately six key qualities. Among these, rapid advancements in technology and political leadership, or governance capabilities, are emerging as critical factors in the decentralized economy. Whichever entity possesses these qualities will likely ascend to the center stage. Therefore, if the US, awakening to this reality post-Trump, seeks to accelerate its progress, it will face challenges. Conversely, even with a rare opportunity, China may struggle to place a collective that meets these demands at the forefront. I wish to emphasize this point. The six qualities I mentioned, when viewed over the longer term, extending into the latter half of the 21st century, include: first, the capacity to maintain ecological balance and exert influence in environmental matters; second, cultural influence, encompassing the creative influence required to shape one's way of life. Therefore, while short-term forecasts of US-China relations in 2026 are possible, we must remain vigilant about the potential for rapid changes driven by factors beyond military and economic might, such as new technologies, leadership, and governance capabilities. Looking further ahead from 2026, we must consider that leaders possessing environmental stewardship and cultural influence will ultimately occupy the center stage. This is my personal perspective.

The six qualities I mentioned, when viewed over the longer term, extending into the latter half of the 21st century, include: first, the capacity to maintain ecological balance and exert influence in environmental matters; second, cultural influence, encompassing the creative influence required to shape one's way of life. Therefore, while short-term forecasts of US-China relations in 2026 are possible, we must remain vigilant about the potential for rapid changes driven by factors beyond military and economic might, such as new technologies, leadership, and governance capabilities. Looking further ahead from 2026, we must consider that leaders possessing environmental stewardship and cultural influence will ultimately occupy the center stage. This is my personal perspective.

Thank you. You have provided a multifaceted outlook for 2026. The global order will inevitably continue to be shaped by the US and China, given their economic and military power. The year 2026 will be a period of adjustment for the core interests of these two nations. Considering the US midterm elections and China's 2027 Party Congress, domestic political variables will play a more significant role than in previous years. In this regard, 2026 will likely be a period of cautious compromise and competitive cooperation between the two countries.

You have highlighted that technological variables will determine the direction of strategic competition between the two nations, underscoring the importance of their respective economic and technological developments. Particularly noteworthy were your points regarding the mid-term and long-term significance of 2026. When evaluating geopolitical trends over a decade, we often become engrossed in short-term developments. However, from the perspective of competition between the US and China, the two nations shaping the global order, it is crucial to focus on which country will attain global leadership in the mid-term and what resources and capabilities will be essential. You also emphasized that in the long term, factors beyond traditional political power resources, such as

a broader understanding of environment, ecology, and culture, will determine the leadership capabilities and strategic execution of the US and China, ultimately deciding who will lead globally. In this context, it is crucial to pay attention to the diplomatic strategies and various changes occurring between these two nations in 2026.

Ha Young-sun, Chairman of the East Asia Institute and Professor Emeritus at Seoul National University.