Counting China’s wins and losses among ‘swing nations’ in new era of power rivalry
As US-China race for hi-tech resources heats up across Global South, countries caught in the middle are under pressure to strike a balance
In laying bare the limits of China’s economic-centric diplomacy towards third countries in its competition with the US, the Venezuela crisis has delivered a stark reminder that spheres of influence continue to shape global politics in this new era of great power rivalry.
In the intensifying rivalry for sway among middle powers and the so-called swing states – those not fully aligned with either great power – China had expanded its presence through economic clout, infrastructure investments and strategic partnerships in regions traditionally dominated by the US, they noted.
China has also deepened technological and scientific cooperation with the region, which it views as central to its drive for a united Global South capable of countering US pressure and advancing a new multipolar international order.
But Washington’s renewed focus on its so-called backyard had exposed the gap between Beijing’s economic leverage and its capacity – or willingness – to provide meaningful political and security support to partners in moments of crisis, the analysts said.
Meanwhile in Argentina, President Javier Milei has secured a US$40 billion aid package from Washington after agreeing to freeze Chinese-backed space and telecommunications projects.
For Pang Zhongying, a professor of international affairs at Sichuan University, the message was clear. “[This is] America’s bottom line: within its sphere of influence, China’s presence can only be limited.”
There were growing concerns within China about the sustainability of its overseas investment model, and Beijing might have to reassess and adjust its policies, Pang said. “The lesson of Venezuela is that economic diplomacy without security guarantees may end up as nothing more than bad debt.”
Historian and political scientist Rana Mitter said the raid revealed that “China’s capacities in Latin America are limited when it comes to intelligence gathering”, pointing out that it happened just hours after Maduro had seen Beijing’s representative for talks.
Mitter, S.T. Lee Chair in US-Asia relations at the Harvard Kennedy School, observed that the raid had also highlighted technological vulnerabilities, despite China’s massive infrastructure investments in Venezuela.
“The US was able to use cyber capacity to hack [Venezuelan capital] Caracas’ power grid, even though much of the tech is Chinese,” he said.
Countries do not want to be wholly dependent on just one major power
While South American nations were still likely to use Chinese capacity for 5G, artificial intelligence (AI) and green energy provision, “left-leaning nations will be confirmed in their sense that China is not a major security player on their behalf”.
Mitter argued that China’s support for Maduro had also “harmed Beijing’s reputation” among the broader population and suggested it would take “huge amounts of diplomatic and soft power work” to reshape perceptions in South America.
Across Latin America and the wider Global South, the crisis has raised critical questions about the true scope of China’s influence in the absence of security commitments, despite its prominent role as a big trading partner for many countries.
“China, whose influence is mainly economic, cannot remove US influence from most regions, should it want to do so,” said Frans-Paul van der Putten, an independent China expert based in the Netherlands.
While the US was retreating from its traditional leadership roles in multilateral organisations, it maintained “an influential position” and a global military presence and “shows no intention to withdraw militarily from East and Southeast Asia”, van der Putten said.
“Whereas the US is redefining its foreign policy, for now this is not producing a major power vacuum for China to step into,” he said, while warning that American coercion also had its limits and risks.
“Countries do not want to be wholly dependent on just one major power.”
Heavy-handed coercion, he argued, could damage “the quality of US military alliances and strategic partnerships with regional swing states”, increasing the likelihood that “in many parts of the world, both the US and China will remain influential in the coming years”.
Trump’s sweeping trade war last year shattered confidence in the decades-old, US-created rules-based order, deepening global distrust and further fracturing already strained Western alliances.
That created an opportunity for China to portray itself as a beacon of stability and reliability, intensifying engagement with its Southeast Asian neighbours while seeking to repair ties with Australia, Canada and South Korea.
Beijing has also called upon developing countries, including key groupings such as Brics and the Shanghai Cooperation Organisation, to form a united front to counter US hegemony.
Yet despite progress, tensions continued to simmer. China’s rare earth controls amid its trade war with the US triggered concerns among multiple countries, while its security pacts with some Pacific island countries prompted sharp opposition from Australia.
Global US-China rivalry over key resources and minerals essential for AI and other hi-tech sectors has intensified from Africa to South America, adding pressure on countries caught in the middle to strike a delicate balance.
Yun Sun, director of the China programme and co-director of the East Asia programme at the Stimson Centre in Washington, noted that today’s world was fragmented between geographical areas and functional domains.
“We see different power structures in different domains: the US in security, China in infrastructure, and the tech space is contested,” she said.
“China’s economic dominance has a long way to go to translate into a major security role. The latter requires knowledge, relationships, influence and interests; the former is more transactional.”
Understanding and drawing swing states to one’s circle required rejecting a rigid Cold War analogy, Sun added.
“A strict bipolarity leaves the countries in the middle [with] very little space to decide their alignment choices. But in reality, they all have agency and enjoy their strategic autonomy between the two great powers, although to different degrees,” she said.
According to Sun, China’s limited role in ending the Gaza crisis and “very little influence over the ending of the Ukraine war” were “a good manifestation” of the gap between its economic weight and security clout.
Philippe Le Corre, a senior fellow at the Asia Society Policy Institute’s Centre for China Analysis, said Beijing had established “a new type of diplomatic and geoeconomic relationship”.
This new relationship leveraged infrastructure, financial aid and – to a certain extent – critical minerals as political tools, particularly in Latin America, Africa, Central Asia, Southeast Asia and the Pacific, he said.
Strategic hedging among middle powers is likely to become the new normal
Le Corre observed that “in many parts of the world, China runs the risk of becoming the new superpower – it is always better to be seen as the challenger”, adding that many countries would “try to strike a balance” between Washington and Beijing when possible.
He noted that middle powers – such as the European Union, Canada, Australia, India and Brazil – had the capacity to resist bloc pressure, whereas more vulnerable states might have “no other choice but to fall into one camp or the other.”
According to Cobus van Staden, managing editor at the China-Global South Project, “strategic hedging among middle powers is likely to become the new normal”, driven by growing demands for strategic autonomy and by memories of Cold War proxy wars.
He argued that many states would seek South–South partnerships as a buffer amid concerns about overdependence on China, prompting diversification with Global South partners like the Gulf states and India rather than simply swinging back to the West.
Zhiqun Zhu, a professor of international relations at Bucknell University in Pennsylvania, echoed van der Putten in cautioning that Trump’s “America first” agenda did not equate to a global vacuum for Beijing to fill.
The Trump administration was “only selectively cutting funding and engagements” around the world rather than turning isolationist, Zhu said.
“China’s global positioning in swing states faces tremendous pushback and challenges from the US, especially in Latin America and the Middle East – America’s traditional spheres of influence,” he added.
Van Staden noted that Trump’s unpredictability had eroded US credibility with its shifting positions on security guarantees, and Beijing was responding “to the feeling of displacement that many countries have experienced in the wake of the Trump shift”.
But US and Chinese influences were not interchangeable, he said, because they “depend on different national capacities”.
China has long championed a coordinated drive with Global South nations to reform international governance and promote alternative forums, yet progress remains slow.
According to van Staden, this “much slower and more piecemeal” approach could have “a long-term effect” of shifting global rules and institutions, even if it could not stop specific US operations in places like Venezuela.
“I think the current crisis exposes the limits of China’s economic focus but also, arguably, the reason for this focus – China is a robust economy but its rise could be complicated by entanglements far from home,” he said.
“This core domestic strategic focus sits in contrast to China’s emerging role as a Global South leader, but the latter is arguably still filtered through similar domestic security priorities.”
How China balances the two “will shape its relationship with the Global South into the future”.