[Global NK Commentary] China's New Evolution in US Strategy in 2026 and the Korean Peninsula

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1. Changes in China's Perception of the International Order: The Decline of American Hegemony and the US-Led International Order

Since the latter half of 2025, Chinese academia has recognized that the collapse of the existing international order, led by the US since the post-war era, is inevitable and has already begun discussions to prepare for a new international order. China perceives the decline of American hegemony as the primary background triggering the collapse of the existing international order. An analysis of US national power in terms of political influence, economic strength, military power, and technological level suggests that American hegemony is structurally weakening from within (Zuo Xiying 2025).

The second Trump administration seeks to delay the weakening of its hegemony, caused by internal issues, through tariff impositions and by shifting more defense costs and international responsibilities to allies and partner countries. This approach is characterized as a shift from 'benevolent hegemony' to 'predatory hegemony' (Zuo Xiying 2025). Some in Chinese academia argue that while 'predatory hegemony' may temporarily delay the decline of American hegemony, it will ultimately fail to prevent and may even accelerate its decline.

Consequently, the global system is analyzed as experiencing accelerating instability due to the decline of the existing order without the establishment of a new international order. The second Trump administration is undermining a significant portion of the US-led international order since the Cold War, and it is projected that even if a Democratic administration takes office after 2028, it will be difficult to restore it. Due to the Trump administration's isolationist and protectionist policies, major powers have significantly weakened trust in the Trump administration, and it is anticipated that they will be less inclined to actively support and participate in the US-led international order as before.

In this era of transformation in the international order, occurring once in a century, the prevailing opinion is that China should strengthen its position as a nation that protects world peace while safeguarding its core interests, rather than engaging in direct confrontation and competition with the US, and should formulate long-term strategic plans.

China judges that the rapid changes and increasing uncertainty in the international order caused by US unilateralism present more opportunities than challenges. China anticipates that the US-led bloc expansion based on systems and values, and the confrontational 'new Cold War' dynamics that troubled China during the Biden administration, will not be replicated. Instead, China sees growing space and opportunities to expand its influence and role in the international community, thereby enhancing its national interests. China is sending a message that it can seek pragmatic compromises and policy coordination with the Trump administration in areas other than its core interests, such as the Taiwan issue.

However, China remains wary that despite the decline of American hegemony, the US still holds a superior position in science, technology, and military power, and possesses the will to control China's development. China is concerned that the US might concentrate its strategic resources from global expansion to core areas essential for maintaining hegemony and implement 'targeted containment' against major strategic competitors to overcome its hegemonic decline. While the US National Security Strategy (NSS) report released in December 2025 may appear to adopt a more relaxed stance towards China compared to previous ones, China is cautious that the underlying intention is to implement more precise, pragmatic, and sustained 'targeted containment' against China as a major strategic competitor (Wang Peng 2025).

Based on its changed perception of the international order, China's diplomatic focus in 2026 is evolving towards designing and formulating scenarios for a multipolar order led by China through a unique, China-centric great power diplomacy that differentiates itself from the US. Therefore, instead of directly targeting the US and intensifying confrontation and competition, China intends to concentrate its diplomatic efforts on Europe, ASEAN, the Global South, and multilateralism to build a multipolar order led by China. This indirect approach is strategically judged as an effective way to avoid direct conflict with the US and, in the long run, to check and counter the US.

2. Evolution of China's Perception and Strategy Regarding US-China Relations

Behind China's active discussion of the decline of American hegemony is its considerable confidence in US-China relations since the latter half of 2025. When Trump's victory in 2024 was confirmed, China was highly concerned and cautious about the launch of a second Trump administration due to the harsh experiences of trade friction during Trump's first term. In the first phone call with President-elect Trump in January 2025, President Xi Jinping congratulated him and emphatically reiterated the importance of respecting China's core interests and major concerns. He specifically requested the US to handle the Taiwan issue with prudence, as it is directly linked to China's sovereignty and territorial integrity (Ministry of Foreign Affairs of the People's Republic of China 2025a).

In the first half of 2025, the US imposed 'reciprocal tariffs' and strengthened export controls, leading to strong countermeasures from China, and the US-China relationship developed into a confrontational pattern. However, after intense conflict and confrontation, both countries transitioned to a new phase of seeking compromise more quickly than expected. US-China tariff negotiations were held five times starting in May, and a summit was finally held in Busan on October 30, 2025. At this meeting, the leaders of both countries agreed to a provisional suspension of tariffs and export controls, reaching a one-year strategic truce.

China assesses that it has achieved remarkable results by responding resolutely and firmly to US tariffs and export controls in 2025, based on the experience accumulated since 2018 in countering US pressure, and its growing national strength in economy, technology, and military power. China highlights that it was the only major power to retaliate with equivalent measures against US trade pressure and did not concede any compromises. It is even evaluated that China was able to control the Trump administration's offensive by retaliating with rare earth export controls in response to US export restrictions imposed on China in September 2025.

Subsequently, China views the US pressure strategy against China as entering a phase of weakening. The view is also emerging that China is being used as a tool rather than a direct target in Trump's 'Make America Great Again' (MAGA) movement. China now claims to have the experience, confidence, and strategy to respond to and manage US offensives. Moving a step further, opinions are being raised that China should design and lead the future scenario of US-China relations (Diao Daming 2025).

Since the Trump administration initiated the trade war against China in its first term in 2018, China has accumulated over eight years of experience and now assesses that it can negotiate with the US on an equal footing. Some interpretations even suggest that a situation of 'assured mutual interference' has been created, analogous to how 'mutually assured destruction' deters nuclear use between nuclear powers, where both China and the US have confirmed their ability to severely disrupt each other's economies and supply chains through strong and effective countermeasures. Based on this, China forecasts that trade conflicts with the US will not excessively escalate in the future. China expects that while the pattern of alternating countermeasures and negotiations with the US may continue, the overall trend will move towards stabilization. China views the resilience of US-China relations, transitioning from confrontation and conflict to compromise, as strengthening.

It remains uncertain whether the Trump administration will indeed favor compromise over containment and pressure as China expects. However, it is clear that optimistic arguments and discussions are actively emerging within China, showing unprecedented confidence in US-China relations since the latter half of 2025. How this change in perception and attitude in China will translate into actual policies and strategies requires closer observation through a series of events, such as the successive summit meetings in 2026. Nevertheless, the message China appears to be conveying recently is clear: China is no longer content to remain in a reactive and passive position in its relationship with the US, but is demonstrating its willingness to take proactive steps from an equal position to stably guide the relationship with the US.

3. Creating a 'Stable Coexistence Relationship' through Negotiations with the US and Strategic Intentions

1) Possibility of Compromise and Deal-Making towards a 'Stable Coexistence Relationship' between the US and China

The increased confidence in US-China diplomacy within China is expanding into discussions about establishing a new paradigm for US-China relations. At the Busan Summit in 2025, the leaders of China and the US, Xi Jinping and Trump, made an effort to seek compromise by restraining conflict and confrontation, albeit temporarily, and by promising summit meetings through mutual visits in 2026, expectations for compromise between the US and China are higher than ever.

Subtle yet significant changes are also detected in the keywords China has recently emphasized in its diplomatic engagements with the US. In summit meetings, China has consistently emphasized its core interests and red lines, while not concealing its wariness and suspicion towards the US. For example, President Xi Jinping stated at the virtual summit with President Biden in November 2021, "If separatist forces advocating 'Taiwan independence' provoke or pressure us, or even cross the red line, we will have no choice but to take firm action," referencing the red line.

At the summit with President Biden in November 2023, President Xi Jinping consistently stated his efforts to build stable, healthy, and sustainable US-China relations, while simultaneously emphasizing that China has interests to protect, principles to uphold, and bottom lines to adhere to. Furthermore, at the Lima Summit in November 2024, he explicitly stressed that the Taiwan issue, democracy and human rights, institutions and systems, and the right to development are the four major red lines that China absolutely will not tolerate (Ministry of Foreign Affairs of the People's Republic of China 2024).

However, since the latter half of 2025, while still firmly maintaining its principled stance on the Taiwan issue, China has been more actively sending messages of compromise towards the US, emphasizing stability, mutual benefit, and cooperation more than wariness. For instance, at the meeting with President Trump in Busan on October 30, 2025, President Xi Jinping no longer mentioned red lines. At that time, he emphasized economic cooperation, stating, "Trade and economic cooperation should be the ballast and driving force of US-China relations, not a source of obstacles or conflict. Both sides should consider the long-term benefits of cooperation and avoid falling into a vicious cycle of mutual retaliation" (Ministry of Foreign Affairs of the People's Republic of China, 2025b). In a phone call with President Trump on November 24, 2025, President Xi Jinping reiterated the importance of cooperation, stating, "Cooperation benefits both countries, and confrontation harms both countries. This principle has been repeatedly verified through practice and is common sense. We have once again demonstrated that mutual achievement and common prosperity between the US and China are achievable realities" (Ministry of Foreign Affairs of the People's Republic of China 2025c).

The change in summit keywords aligns with the positive outlook on US-China relations presented by Chinese researchers mentioned earlier. While this internal shift in China may be the result of objective analysis and judgment, it more clearly confirms that China has a policy objective to actively negotiate with the US on an equal footing and thereby stabilize US-China relations.

Furthermore, China is expressing its intention to proactively propose new directions and scenarios for bilateral relations, rather than being passive and reactive. In his speech at the annual 'International Situation and China's Diplomacy' seminar in December 2025, Foreign Minister Wang Yi proposed the need for a new paradigm in relations with the US (Ministry of Foreign Affairs of the People's Republic of China 2025d). Specifically, he stated, "We will create a new paradigm of mutually beneficial interaction between the US and China. And we will promote the development of sound, stable, and sustainable US-China relations," thereby presenting the direction of new US-China relations envisioned by China.

In the future, China envisions a situation where competition proceeds with each side pursuing its own strategy based on equal capabilities, and accordingly, the two countries will adjust the intensity of confrontation and competition and move towards peaceful coexistence by accommodating each other's strategic changes (Da Wei, 2025). For example, US-China relations are seen as having transformed into a relationship between two nationalist great powers for the first time in history. Trump's 'Make America Great Again' and Xi Jinping's 'Great Rejuvenation of the Chinese Nation' both advocate nationalist goals, which are not necessarily conflicting, and it is argued that the US and China may at least not hinder each other. With several US-China summits expected in 2026, including Trump's visit to China in April, the APEC summit in November, and the G20 summit in December, China believes it should use these opportunities to seek reasonable coexistence arrangements suitable for a new era.

Specific measures for building a stable bilateral relationship that meets the realistic needs of both the US and China are also being discussed. For instance, Professor Wu Xinbo of Fudan University (Wu Xinbo 2026) proposes a 'Grand Bargain' between the US and China. Wu suggests that since a grand bargain is difficult, it would be advisable to start negotiations in relatively easily agreed-upon areas such as trade and economy to build mutual trust, and then gradually expand negotiations to more complex regional security issues and global issues based on the trust established.

For example, China proposes a deal where it increases imports from the US, such as soybeans, and investment in US manufacturing, while the US eases export controls and reduces regulations on Chinese private companies. In the science and technology sector, China proposes a deal where the US relaxes regulations on technology import and export to China, and China correspondingly moderates its restrictions on rare earth and critical mineral exports. Building on agreements in trade and economy, the proposal suggests progressing to discussions for risk management in more complex geopolitical competition, such as the Korean Peninsula, the South China Sea, and the Taiwan issue. The Taiwan issue, in particular, is positioned as the most critical challenge that will determine the future of US-China relations; to prevent the escalation of conflict, the US would be asked to exercise restraint and influence Taiwan to prevent overt 'independence' actions, while China would show goodwill by reducing military activities around Taiwan.

In the global arena, it is believed that discussions are needed to clarify each side's role in the international order. China clarifies that it does not seek to completely overthrow the existing US-led order, but rather to enhance the efficiency of some multilateral organizations and strengthen the representation of non-Western countries while maintaining overall stability, and aims to gain substantial trust from the US and the international community in this regard.

Furthermore, Professor Wang Jisi suggests the need for mutual exchange of 'strategic clarity,' where 'the US abandons attempts to subvert China's system, and China does not challenge US global leadership' (Wang Jisi, 2026). Professor Wang also proposes that rather than striving to 'improve' US-China relations, the goal should be pragmatic 'coexistence' where each side clarifies its red lines and pursues its own interests within them. In summary, the discussions within China, including Foreign Minister Wang Yi's proposals, indicate that China aims to establish a stable coexistence model through pragmatic trade and negotiations on mutual interests from an equal position in its relationship with the US during this once-in-a-century transition of the international order.

2) China's Strategic Intentions and Challenges

China's new proposals are largely intended to capture and proactively leverage President Trump's pursuit of Americanism and his transactional instincts. Nevertheless, there are significant constraints and limitations to the actualization of compromises or deals. First, due to the nature of its political system, China fundamentally assumes the possibility of a grand bargain led by Presidents Xi and Trump. However, while President Trump exhibits an exceptionally autocratic and transactional tendency for an American president, unlike the Chinese system, the US presidency has term limits and checks on power, meaning he cannot unilaterally enforce a deal. Even if a deal between Xi and Trump is reached, it may not guarantee the long-term stabilization of US-China relations.

Second, in any deal, trust is as important as the equitable exchange of benefits. However, most mainstream politicians and high-level policymakers in the US still harbor strong distrust towards deals and negotiations with China. Therefore, it is highly suspected that the recent discussions on negotiations and deals within China are merely 'time-buying' proposals focused on laying the groundwork for China's modernization roadmap, which is set for 2035. The US fundamentally distrusts the Chinese government and its strategic intentions, making it likely to oppose deals structured as a 'Grand Bargain.'

The fact that compromise and deal proposals are being actively advanced by both the government and academia in China, which is unusual, can be seen as an intention to stabilize relations with the Trump administration. However, given the high likelihood that compromises may not materialize as China expects, there may be other strategic considerations and intentions underlying China's negotiation proposals.

First, it is possible that China's proposal for coexistence with the US is intended, at least in part, to buy time by resolving the instability and uncertainty of the Trump presidency and temporarily evading US pressure and controls. China judges that a temporary compromise with China might be a viable option for President Trump, who faces political difficulties due to issues such as the crackdown on illegal immigration ahead of the midterm elections. From President Trump's perspective, proposals from China such as purchasing US agricultural products like soybeans and energy (LNG), cooperating on blocking fentanyl precursors, increasing direct investment in US manufacturing, and lifting rare earth export controls could be worth considering for a deal.

From China's perspective, 2026 marks the beginning of the '15th Five-Year Plan,' a period requiring unprecedented focus on domestic development. The stable launch and success of the 15th Five-Year Plan are crucial variables for stabilizing the Xi Jinping regime and for Xi's long-term rule. Therefore, the Xi Jinping government faces the critical task of concentrating on economic structural reform and revitalization, and technological self-reliance internally, while minimizing confrontation and conflict with the Trump administration and overcoming US trade and technology controls. Consequently, China may be considering a fallback option of achieving a 'small deal' in trade and economic areas, even if not a full 'Grand Bargain' with the US, to extend the temporary truce.

Second, while China is proposing stable coexistence to the US, its proposal may also be directed at other countries in the international community, excluding the US. In other words, China may be seeking to secure global leadership by actively projecting diplomatic rhetoric emphasizing its stability, certainty, and responsibility, leveraging the diplomatic space created by the Trump administration's isolationism and 'America First' policy. Indeed, China is actively approaching US allies and partners, as well as Global South countries, who are weary of the coercive and unpredictable policies of the Trump administration, by highlighting the continuity and predictability of its own policies.

In this regard, Foreign Minister Wang Yi, in his December 2025 speech, unusually emphasized five major roles for China in the international community. He asserted that in the turbulent global landscape, China serves as an 'anchor of stability' (稳定锚), a 'strong pillar' (主心骨) in the new geopolitical environment, a 'guiding star' (定盘星) for the changing international order, an 'engine of growth' (主引擎) driving global economic development, and a 'ballast stone' (压舱石) in times of international moral crisis. China is actively expanding its role in the international community during this period of transition in the international order, starkly contrasting with the Trump administration's isolationism, in an effort to secure global leadership. While continuously proposing stable coexistence to the US, China is simultaneously seizing the opportunity presented by the decline of American hegemony to pursue comprehensive and extensive diplomacy aimed at strengthening its international influence and leadership. In fact, China is leading reforms in global governance to strengthen the multipolar order and is enhancing practical cooperation and solidarity with countries in Europe, the Middle East, ASEAN, and the Global South.

4. Changes in China's US Strategy and Their Impact and Implications for Korean Peninsula Policy

China is actively expressing its determination to pioneer a new horizon for its distinctive great power diplomacy, targeting 2026. The reason China is newly emphasizing great power diplomacy is that the commencement of the 15th Five-Year Plan and the securing of a stable coexistence relationship with the US are, in fact, the most crucial diplomatic tasks for 2026. Furthermore, as mentioned earlier, the 15th Five-Year Plan and US-China diplomacy are closely interconnected. Securing stable coexistence in US-China relations is a key variable for the success of the 15th Five-Year Plan, and the success of the 15th Five-Year Plan can serve as an important foundation for China to secure leadership in its diplomacy with the US.

The 7 major diplomatic tasks for 2026 proposed by Foreign Minister Wang Yi include building a community of shared future with neighboring countries. However, neighboring diplomacy is also a background and dependent variable for the achievement of the 15th Five-Year Plan and US-China diplomacy. The Korean Peninsula is a strategically very important object of China's neighboring diplomacy. However, the strategic importance of the Korean Peninsula is highly fluid, influenced by China's development strategy and its diplomacy with the US.

The recent, highly unusual occurrence of two consecutive South Korea-China summit meetings within a two-month period confirms that both governments share a strong will to restore relations. However, it is undeniable that complex external variables, such as Sino-Japanese tensions, South Korea-Japan summit, US-China summit, and the possibility of North Korea-US talks, played a role in the sudden arrangement of the summits early in the year. While the instability and uncertainty of the international situation, including US-China relations, can serve as an opportunity for the restoration of South Korea-China relations, they can also lead to the worst-case scenarios, as seen in the THAAD conflict in 2016.

While the two summit meetings confirmed the will to restore relations, they also reaffirmed that a situation of strategic divergence, where both countries have mutually different expectations and demands, still exists. The issues of North Korea and the United States, which have been the biggest variables and obstacles in the 34-year history of South Korea-China relations, have once again been brought up as differing demands from both countries at a crucial juncture for restoring relations. South Korea focused on the North Korean issue and the Korean Peninsula issue as agenda items for the summit, while China confirmed its expectations regarding South Korea's strategic choices concerning US-China strategic competition and the Taiwan issue.

Furthermore, China is proposing, albeit possibly temporarily, deals and negotiations for coexistence with the US. In Professor Wu's proposed 'Grand Bargain,' the Korean Peninsula issue is also presented as an agenda item that requires sequential negotiation between the two countries. Regarding the Korean Peninsula issue, Professor Wu suggests shifting from deterrence policies to a peace mechanism jointly guaranteed by the US and China, such as managing the situation through the resumption of four-party talks. Currently, neither the US nor China is prioritizing the North Korean nuclear issue, and both are effectively avoiding any mention of North Korea's denuclearization. Although it is merely a scholar's suggestion, given the current trend, the possibility cannot be ruled out that the US and China might use the Korean Peninsula issue as a bargaining chip without consulting South Korea to achieve a temporary truce.

The Lee Jae-myung administration is pursuing the modernization of the ROK-US alliance and the full restoration of ROK-China relations under the banner of pragmatic diplomacy, objectives that could potentially conflict. Simultaneously, given South Korea's stance that it can never accept North Korea's possession of nuclear weapons, it must monitor and prepare for North Korea-US dialogue, but also consider the possibility of a sudden compromise between the US and China and prepare accordingly. South Korea's pragmatic diplomacy in 2026 may face a critical test. The ROK-US, ROK-China, US-China, and North Korea-US relations are intricately interconnected and influence each other, leading to unpredictable situations where South Korea risks being marginalized or sacrificed. More than ever, strategic consideration and preparation are crucial for navigating these complex equations and addressing various scenarios.

First, regarding ROK-China relations, while restoring relations is important, it is essential to promptly restore strategic dialogues at various levels that have been suspended to prepare for unpredictable changes and to secure close communication channels between the two countries. South Korea and China must engage in sustained strategic dialogue to gain a clearer and more objective understanding of each other's maximum expectations and minimum red lines. Through this process, preventing and managing a sudden deterioration of the situation on the Korean Peninsula due to complex challenges from external variables should be the priority task for restoring relations. ■

References

Wang Peng. 2025. “US Latest National Security Strategy Report Highlights 'Pragmatic Containment' of China.” October 12. Xi Jinping Thought on Diplomacy and China's Diplomacy in the New Era Website. https://cn.chinadiplomacy.org.cn/2025-12/10/content_118220692.shtml

Da Wei. 2025. “US-China Relations: Resilience and New Prospects Amidst Stormy Winds.” *World Knowledge*, December 26. https://cn.chinadiplomacy.org.cn/2025-12/26/content_118247640.shtml

Diao Daming. 2025. “Seize the 'Script' for Shaping US-China Relations and the International Order Ourselves.” *World Knowledge*, August 29. https://cn.chinadiplomacy.org.cn/2025-08/29/content_118048563.shtml

Zuo Xiying. 2025. “The Trump Administration and the Formation of American Predatory Hegemony.” *World Economy and Politics*, Issue 12.

Professor Wang Jisi in dialogue with former US Deputy Secretary of State Steinberg (January 15, 2026). https://m.thepaper.cn/baijiahao_32441494

Ministry of Foreign Affairs of the People's Republic of China. 2025a. “Xi Jinping Holds Phone Call with US President-elect Trump.” January 17. https://www.mfa.gov.cn/zyxw/202501/t20250117_11538132.shtml

Ministry of Foreign Affairs of the People's Republic of China. 2025b. “Xi Jinping Holds Talks with U.S. President Trump in Busan.” 10-30. https://www.mfa.gov.cn/zyxw/202510/t20251030_11743847.shtml

Ministry of Foreign Affairs of the People's Republic of China. 2025c. “Xi Jinping Holds Telephone Conversation with U.S. President Trump.” 11-24. https://www.mfa.gov.cn/zyxw/202511/t20251124_11759124.shtml

Ministry of Foreign Affairs of the People's Republic of China. 2025d. Wang Yi Attends the 2025 International Situation and China's Diplomacy Seminar and Delivers a Keynote Speech.” 12-30. https://www.mfa.gov.cn/wjbzhd/202512/t20251230_11790364.shtml

Ministry of Foreign Affairs of the People's Republic of China. 2024. “Xi Jinping Holds Talks with U.S. President Biden in Lima.” 11-17. https://www.mfa.gov.cn/zyxw/202412/t20241218_11497766.shtml

Wu Xinbo. 2026. "The Case for a Grand Bargain Between America and China."Foreign Affairs. Jan/Feb

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