Beijing has discretely employed a “red thread” of the dragon and phoenix strategy to compete in the sea and air with its global rival — the United States. Following the Chinese mythology of the invisible red thread — which connects those who are destined to meet — China has been expanding its spheres of political influence, displaying military power, and strengthening economic linkages.
Peaceful war?
With thriving diplomatic outreach and trade connectivity, China is heading for neither Cold War 2.0 nor a hot war — but manifesting the art of “Peaceful War.” Regardless of each country’s national history, geography, and culture, the significance of the red thread is that China is destined to be the unifying force in building a “community with a shared future for mankind” through trade and development.
China’s foreign policy agenda was shrewdly revised when President Xi Jinping’s new Defence Minister Dong Jun unveiled it at the Shangri-La Dialogue security forum in June 2024. Admiral Dong depicted China as a benign power, whose military “never acts from the so-called position of strength.” It was indeed a sarcastic criticism of America’s perennial “peace through strength” doctrine, which is associated originally with President George Washington’s Farewell Address and, more recently, with President Ronald Reagan.
Ironically, however, China’s words contradict its actions. Mere days after Taiwan’s inauguration of its democratically elected president on May 20, 2024, Beijing staged aggressive military exercises encircling the island with Chinese vessels and aircraft.
Coincidentally, history is repeating itself — and not for the first time. For example, when President Barack Obama expressed concerns about the Chinese militarisation of artificial islands in the South China Sea (SCS) in 2015, President Xi assured him that China did not have such intentions. A year later, however, Beijing admitted that it was building “necessary military facilities” in the South China Sea (SCS), thus, breaking its promise to the US president of peaceful “Chimerican” leadership.
Dragon and phoenix in action
Since then, China has masterfully been carrying out its long-term, multi-layered, and multi-vector strategy of the red thread of the dragon and the phoenix. Similar to its incursions into Taiwan’s waters and airspace, Beijing has incrementally been expanding its displays of force through vessels and aircraft in the SCS and the Indian Ocean, i.e., China’s “Western Ocean.” Chinese vessels and aircraft have been widely reported patrolling and making aggressive manoeuvers against Japan around the Senkaku Islands in the East China Sea (ECS), and the Philippines and Vietnam in the SCS. Similarly, China has sent spy balloons to the United States.
China has a seemingly disjointed yet stealthily unified global strategy, threaded carefully through the ECS, the SCS, the Indian Ocean, the Red Sea, and the Mediterranean Sea up to the Baltic Sea. The strategy encompasses the Eurasian hinterlands and islands that are associated with the Middle Kingdom’s two pivotal ancient Silk Road eras: the Tang and Ming Dynasties. President Xi’s “China Dream,” which is aimed at realizing the national rejuvenation of Chinese culture through the Belt and Road Initiative (BRI), reincarnates the Tang Dynasty’s cosmopolitan China and the Ming Dynasty’s maritime supremacy. The BRI’s defining sectors of politics, economics, and technology are crucial for projecting power onto its main global competitor while winning over Washington’s friends and enemies alike.
Thus, China’s red thread strategy does not involve firing a single bullet—at least not directly—at the United States to win this war peacefully. After the United States’ three debacles in Afghanistan, Iraq, and Vietnam, China has evidently calculated how to benefit — especially in commercial diplomacy — from costly U.S. military entanglements in Ukraine, Israel, and possibly in the Philippines or Taiwan.
Winning battles without war
For China, history is everything. Boosting national rejuvenation and its mission for “reunification” of Taiwan, Beijing has been modernizing itself to overcome the trauma of the Century of Humiliation and regain the respectful dominion that it is entitled to — at least from the point of view of the Communist Party of China.
To that end, China’s dragon and phoenix strategy encompasses seven operational elements, which might be described as a modified “MIDLIFE” (i.e., military, intelligence, diplomacy, legal, identity, financial, and economic) to battle with the United States without resorting to direct war-like conflicts:
Military
By employing dual-use technologies for military and civilian purposes, Beijing has built three aircraft carriers — Liaoning, Shandong, and Fujian — to signal its coming-of-age supremacy, followed by advancements in supersonic aircraft technologies. China continues to collaborate with the United States and other technologically advanced countries to attract their know-how, including its recent efforts to recruit fighter pilots from the United States and NATO to train China’s military.
Intelligence
In addition to using the Chinese diaspora for espionage — including scientific espionage and intellectual property theft — China exploits its global influence to gather information and lobby for policies favorable to Beijing, as demonstrated in Australia and Thailand. The United States has also accused China of promoting cyber espionage on American military infrastructure, sponsoring misinformation and disinformation campaigns, and concealing interference in political elections.
Diplomacy
Apart from China’s assertive “wolf warrior diplomacy,” Beijing also quietly poses as a green investor, commercial contractor, and peaceful mediator. For example, Beijing has positioned itself as a mediator in the Middle East crisis and the Russian-Ukrainian conflict. Interestingly, in such cases, China purposefully avoids multilateral platforms — as demonstrated by Beijing’s refusal to join the planned Russia-Ukraine peace summit in Switzerland. In an effort to undermine U.S. alliances, China has already used its power of commercial diplomacy to sign a trilateral partnership with Japan and South Korea, developed a range of bilateral economic and cultural relationships with countries in the European Union and NATO, and attempted to promote China-made electric vehicles and batteries in European countries.
Legal
Beijing strategically places Chinese nationals and those from friendly countries in key positions in the United Nations system. This tactic allows Beijing to influence and shape UN policies and decisions from within. These changes include setting the global agenda on areas critical to digital and AI governance in world affairs and revising the language of UN documents.
Identity
China wields its scientific and technological prowess as a form of currency, affording it purchasing power in global leadership. A recent example is its space exploration efforts to reach the mysterious “far side of the moon.”
Financial
China is spearheading efforts to reduce the dollar’s power by internationalizing the Yuan as the currency of global transactions in BRI countries, such as Iran, Russia, and Saudi Arabia. This de-dollarisation is part of the red thread strategy to weaken the effects of economic sanctions levied against Cuba, China, Iran, North Korea, Russia, and Venezuela.
Economic
Having signed BRI agreements with over 150 countries and international organizations, China has connections to crucial supply chains and key trading ports and airports in geopolitically strategic locations. Investing in massive harbors and airports and gaining access to these ports carries strategic implications beyond mere economic significance. The port city of Gdynia in Poland, for example, is reportedly being used by China as a military monitoring post for American weapons shipments to Ukraine and possibly providing intelligence support to Russia.
Beijing’s peaceful war’
These MIDLIFE operations sometimes blur the lines between and among economic, military, scientific, and intelligence domains, often serving multiple purposes concurrently. Following Hamas’ attacks on Israel, Iran-backed Houthi rebels in Yemen targeted American cargo and military ships in the Red Sea. Chinese cargo ships, by contrast, have enjoyed selective safety in their passage.
As a result, European and American ships have been diverted through the coast of South Africa with greater delays and higher costs than Chinese shipments. Favorable price advantages have allowed China to compete easily with its market access, while American and European consumers suffer from inflated prices and the drainage of national resources.
The evolving economic situation with Chinese subsidies and cheaper green technologies — like solar energy, electric vehicles, and revolutionary batteries — is a tectonic shift, especially when the United States and NATO are entangled with two simultaneous wars in the Middle East and Ukraine. Meanwhile, China is standing on the sidelines, benefitting economically and promoting its image as a peaceful mediator and benevolent investor — particularly in the Middle East and Africa — as opposed to the West being entrenched in military conflicts and right-wing political extremism.
In all this, these MIDLIFE operations are strategically amalgamated into an expansive yet subtle “cognitive warfare” to win the hearts and minds of the global citizenry — especially as public trust in American democracy shifts amid the prospect of another Donald Trump presidency and the continued war in the Middle East. China needs Trump’s victory to convince the world about the supremacy of Beijing’s “centralized democracy” and seemingly more stable governance over the allegedly weak, chaotic, and unpredictable democracy within the American political system.
Authors:
Dr. Patrick Mendis, a presidential advisor to the U.S. National Security Education Board, is the inaugural Taiwan chair and distinguished visiting professor of international relations at the Jagiellonian University in Krakow and a distinguished visiting professor of transatlantic relations at the University of Warsaw, Poland.
Dr. Antonina Łuszczykiewicz-Mendis, a former Fulbright senior scholar at Indiana University in the United States, is an assistant professor at the Jagiellonian University in Krakow and a research fellow at the Central European Institute of Asian Studies in Bratislava, Slovakia. They are former Taiwanese fellows of the Ministry of Foreign Affairs in Taipei. The views expressed in this article are those of the authors and do not reflect the official policy or position of their affiliated institutions or governments.
The article was originally published under the title The Dragon and Phoenix: How Beijing is Winning Battles in Its ‘Peaceful War’ with the United States by the Australian Institute of International Affairs.
Follow us on X, Facebook, or Pinterest
