Deep Dive: The Dragon in America’s Playground – China’s Counter-U.S. Foreign Policy War

Originally published May 15, 2026 for our weekly Issue of Mindful Intelligence Advisor.  Subscribe to get weekly issues.

By Paul Gordon Collier, Editor

“If you ignore the dragon, it will eat you. If you try to confront the dragon it will overpower you. If you ride the dragon, you will take advantage of its might and power.” – Chinese Proverb

OVERVIEW

China has been aggressively attempting to drive the U.S. out of regions it once dominated. The regions we are analyzing are Africa, Western Europe (the EU nations primarily), and the Americas. For each region, China has a different foreign policy approach, but it has a few tools it uses repeatedly.

The primary tool is entanglement, a strategy that is also used to procure resources at discount prices. This involves building infrastructure that is sustained by Chinese workers, or Chinese-paid workers, offering loan packages that create mounting perpetual debt, and integrating their economy into yours through trade.

The variation of its application comes through how China leverages that power to affect policy. In the case of Africa, there is little demand on policy, beyond Taiwan, but in the Americas, China wants a little more than mere profit.

The second tool is narrative. The use of this tool is much more difficult to document and track. It warrants a report on its own. For now, we will bracket off this tool and focus primarily on economic tools, which are China’s primary overt foreign policy weapons.

This report is intended to show the reader, just through the open policies of China, just how aggressive and invasive China has been in its ongoing effort to topple the U.S. as the military hegemon of the world.

It does not touch on the clandestine operations, such as the narrative tools deployed by bots and agents, some of which become California mayors.

AFRICA

China’s approach to Africa is more pragmatic than the other two regions we will analyze. They have adopted the “Anglo model,” which trades good deals on resources for infrastructure development.

Beyond resources, China wants entanglement with markets that make it difficult, if not impossible, to allow any quick African exodus from Chinese influence. Maximally, they want that entanglement to come at the expense of the West, especially the United States.

The China-Africa Cooperation (FOCAC) began in 2000; In less than three decades this institution has become the backbone of China’s Africa policy.

Through this it has trained soldiers and students, and served in UN Africa missions, where the PLA accounts for more troops than any other permanent member of the UN. It is second only to France in training African students.

China’s recently announced policy packages for Africa offering zero-tariff deals for 53 African nations.

Unlike the West, including the U.S., China makes no cultural or social policy conditions on its potential African allies outside of not acknowledging Taiwan as an independent nation.

1. RARE EARTH MINERALS – The largest reserve of cobalt reserves sits in the Democratic Republic of Congo. China’s mining firms are operating within the region, but the region itself is highly unstable.

The pushback against Chinese incursions into more rare earth mineral fields has begun, with 13 African countries now banning certain “critical” rare earth minerals from being exported, with China as the unnamed target.

China’s development of the Lithium Green Lane is attempting to monopolize the global battery supply chain. Zimbabwe, Mali, and Namibia are part of the chain. China is now developing processing or “beneficiation” plants so they can export a more finished product.

2. SAHEL – China is on most unsteady ground in the Sahel, where efforts to align with junta governments like Burkina Faso, Mali, and Guinea, have led to the juntas turning on the Chinese. What’s at state are more rare earth minerals, especially lithium.
3. AFRICA AND TAIWAN – China’s One Nation policy, enforcing the notion Taiwan is a part of China, not an independent nation, is winning the day in Africa. Only two African nations, Eswatini and São Tomé and Príncipe, recognize Taiwan and sustaining diplomatic relations with them.
4. AFRICAN ALLIES – China has three strong allies of note, Djibouti, South Africa, and Ethiopia. Djibouti is China’s most significant ally. China’s first overseas military base was built in Djibouti. It its China’s largest import point into Africa and China’s second-largest export point out from Africa.

Ethiopia is China’s “investment for bases” model. China has invested hundreds of millions of dollars building infrastructure in Ethiopia. That includes railways, communications systems, and even industrial parks. They have a tight military partnership.

The African Union Headquarters is located in Ethiopia’s Addis Ababa. It was built by China.

South Africa might be China’s most complete partner. South Africa is one of the letter countries in China’s BRICS scheme, an effort to counter the U.S. dollar’s world reserve currency status. BRICS stands for Brazile, Russia, China, and South Africa. China has bestowed on South Africa the status of “all-around strategic cooperative partnership.”

5. AFRICAN ADVERSARIES – The only direct adversary of China in Africa is Eswanti, which is also one of only two African countries to sustain diplomatic relations with Taiwan. In response, China has severed all diplomatic relations with the country.

Eswanti is located completely within South Africa. Its geopolitical location within a strong Chinese ally gives it incentive not to support China.

Zambia isn’t a direct adversary like Eswanti, but it was the first African nation to default on its sovereign debt to China. This happened during the Covid-19 pandemic. As a result, Zambia is seeking relief from western authorities, though they haven’t fully broken with China either. China’s control over the nation’s mines and power grids makes that separation difficult.

6. KENYA – Most of China’s relations with other African nations fit into some category of mixed. Kenya stands out as a bellwether of this type of relationship.

Kenya has received a lot of funding from China, which has seen a lot of infrastructure built, including their Standard Gauge Railway. But China is losing support in the country, as mounting debt to China is causing them to question their own sovereignty, a theme not uncommon with countries in this relational category.

EUROPE

China approaches Europe both as a single economic bloc and as independent nations they develop unique policies for. Underlying all their policies is efforts to tilt Europe away from America. The tension against that comes from Russia, which China has continued to support, even if not consistently aggressively.

The EU receives economic leverage in its American dealings by inviting China into their markets, and being allowed into China’s markets, but they also see China as a threat.

The long-held line is that China is an economic partner, but also a competitor, and a systemic rival. However, that last claim gets more dubious as much of Europe continues to become increasingly authoritarian.

The nations are coming closer together even as, at minimum, a plurality of people in Europe are growing increasingly hostile to these policy shifts towards Beijing’s governance model.

One wedge China has exploited recently is the “Global South” narrative, which is a narrative that a polar, or even bipolar world, created a great injustice in the global south. China uses the narrative to suggest Europe should support a multipolar world to avoid another global south injustice.

They don’t aggressively push Europe away from the U.S., they push them towards “neutrality” on the U.S.-China rivalry.

1. HUNGARY – China’s strongest ally has been lost after Viktor Orban lost his re-election bid to EU-supporting Peter Magyar. The win immediately affected China’s power as Hungary quickly shifted from resisting aid to Ukraine to now supporting it. Hungary has been blocking many CCP-disproved policies, and now that is over.

However, Hungary’s entanglement with China is such that it cannot cleanly break away, so efforts have been made to at least normalize relations, even if Hungary is no longer going to be the CCP-s EU veto.

2. LITHUANIA – The only clear adversary of China, Lithuania represents a spirit held by other Balkan states, like Estonia and Latvia.

Lithuania decided to recognize Taiwan, which led China to sever all ties with the nation. In response, Lithuania allowed Taiwan to create a “Taiwanese Representative Office” on its soil.

3. GERMANY – While Germany is China’s biggest economic trade partner, the country is becoming concerned about just how dependent they now are on Chinese supply chains while China has also become an industrial competitor.

Germany is a bellwether of the risk of the entanglement strategy, especially among the citizens themselves.

4. ITALY – China’s Belt and Road Initiative got its first home in Europe in Italy, the first G7 nation to become part of the project. However, as China moved in and projects moved forward, Italy had second thoughts. Just four years later, they would formally exit the belt and road.

While Italy still wants to trade with China, they are no longer interested in opening themselves up to the Chinese entanglement strategy.

CHINA AND THE AMERICA

Within the Americas, China is looking fundamentally to disrupt American power and shatter the mantle that the Americas are the United States’ “backyard.”

It’s approach to each nation is more wholly systemic than Europe’s policies, which are more systemic than Africa’s policies. While America is always a part of almost every relationship China forms in these three regions of the world, it’s not as prevalent as it is in the Americas.

In addition to blunting U.S. power, China also relies on Latin America for essential commodity exports. China has become the top trade partner for numerous South American countries.

In keeping with its entanglement strategy, China is also building infrastructure in Latin America, including railroads, mining operations, and energy grids.

On the Taiwan front, China has turned most of countries towards its One China policy, with holdouts in the Caribbean, including Belize, Haiti, and Saint Vincent.

Beginning in the early 2000s, China’s Belt and Road initiative started in earnest in South America, making it the number one trading partner of the whole continent. Over $140 billion in loans have been issued through the project since 2005.

As in Europe, China is also using the “Global South” narrative to push the Americas to minimally remain neutral in the U.S.-China rivalry.

However, it’s policies in the America’s took a serious hit when the United States effectively replaced a pro-Chinese regime in Venezuela with a pro-U.S. one.

1. THE VENEZUELA SHIFT – In January 2026, the U.S. pulled off a stunning operation in the middle of the night that saw the balance of power shift in Venezuela by the time the sun rose. Pro-China President Nicolas Maduro had been seized by U.S. forces and taken to a U.S. prison where he sits today, facing numerous drug trafficking related charges.

Venezuela was the strategic crown jewel of China’s foothold strategy in South America. Through Maduro, China was given great access to the continent. Not only did China lose the foothold, they also lost roughly $60 billion the Maduro regime owed them.

The collapse of the Maduro regime has led to the end of the so-called “Bolivarian axis.” Venezuela was the lynchpin of the axis, which included Nicaragua and Cuba. As a result, Beijing is shifting to an “Institutional” strategy.

They are no longer looking to back “rogue” regimes, but instead want to rely on “institutional” democracies that submit more easily to international law.

The ability of the U.S. to snatch Maduro so easily is leading China to want to develop networks outside of U.S. observation, especially financial ones. A key development is China’s digital Yuan (e-CNY), which hopes to replace the U.S. controlled SWIFT system that most of the world uses to move currency legally.

China’s policy of avoiding military conflict with the U.S. has caused it to shift from hopes of developing a military presence openly in South America to more clandestine developments, along with continued entanglement strategies.

China also took a major surveillance hit by losing access to Venezuela’s satellite tracking stations. Overnight, it also lost access to all of Venezuela’s military ports.

The general world policy expert consensus is that this action has not finished China in the Americas, but it has forced it to take a more patient approach as it bides its time before it can sufficiently challenge the U.S. militarily.

China’s entanglement strategy in the Americas appears to have avoided the excesses in Europe and Africa. It hasn’t raised widespread local concerns of Chinese dependence, but it has made these countries unable to fully disentangle from China.

While the South American countries are not likely to challenge U.S. policy in relation to China, they’re also not likely to stop doing business with China anytime soon.

One good outcome for China is the emerging notion of the “lawlessness” of the U.S., which will open doors for China. However, its inability to offer military protection to such a key ally as Maduro somewhat blunts the opportunity, since its standing as a security protector is significantly less than it was before January 2026.

2. PANAMA – The first major blow to China’s presence in the Americas came with Panama throwing China out as the operator of the Panama Canal. The move has pitted Panama against China directly, with the U.S. providing security.

Outside of the United States, it’s the only nation of the Americas to be in an adversarial role with China.

3. CHINA’S AMERICAS ALLIES – Brazil, Cuba, and Peru now stand as the jewels of China’s alliance in the Americas. Of the three, Cuba stands on the precipice of being lost to China, but, for now, it is still holding on.

Brazil is the largest agriculture exporter in the world. China is the world’s largest agriculture exporter. Between the two, their volumes are so high they can bypass western standards and set their own global “green commodities” standards. This is called the “Beijing-Brasilia” effect.

Cuba offers China a military presence, which is why, in part, the U.S. is moving so aggressively to affect regime change. Cuba’s ties to China are more ideological than any other nation in the Americas, which has made the relationship an easy fit.

Peru has become maybe the most economically entangled country with China of all the nations of the Americas. The capstone of that relationship is the $1.3 billion mega-port in Chancay. It is strategically the most valuable asset China has access to in all of the Americas.

4. COLUMBIA – Columbia is in a state of limbo when it comes to China, with 2026 elections determining the China’s fate. The country signed a belt and road agreement with China in 2025, but that deal is now in doubt. The elections happen at the end of this month, May 2026.
5. MIXED ALLIANCES – Most of the nations of the Americas fall into the Mixed Alliance category, with Canada, Mexico, and Chile, being the bellwethers of the group.

Canada had a good relationship with China until several scandals, including accusations of election interference, caused the relationship to collapse. Now, the Prime Minister of Canada, Mark Carney, has been working on mending those relations, even calling for the multipolar vision of the world China has been pitching.

Carney appears willing to use China as a blunt on President Trump’s power, but Canada’s security mistrust of China isn’t going away any time soon.

Mexico is China’s second largest regional trade partner, but one not wholly trusting of that relationship. Mexico views China as a direct goods competitor and has imposed tariffs on China to minimize its presence. Mexico’s entanglement with the U.S. insulates it from China’s full entanglement strategy.

Chile has strong economic ties to China, but it is not so keen to have China become entangled in its economy. It also favors U.S. security ties, which it also feels more ideologically aligned with. Chile remains a top 3 major partner for China in the Americas, but one kicking its heels in protest.

SUMMARY

In less than 30 years, China went from a backwater foreign policy power to one second only to the U.S. in world influence, and that claim might be disputed.

Partly on bluster and partly on real accomplishments, China has built its entanglement into multiple nations who once relied primarily on the U.S. for security and commerce. Their foreign policy is thoughtful, complex, and above all else clearly serves the best interests of China.

In 2026, China suffered two major setbacks to its foreign policy schemes, the fall of Maduro and the loss of the Panama Canal. With Iran threatening to totter, a third catastrophe could soon be on the way. Yet even if Iran were to fall, China would still have solid options to overcome the loss of Iran, and neither the Panama Canal nor Venezuela have finished them off in the Americas.

The wildcard in the China foreign policy is the state of affairs at home. No great power in the world is stable, and China is no exception. Chairman Xi’s recent purge of Generals testifies to that fact.

In some ways, it seems Xi’s foreign policy strategy is more thoughtful, more long-term in thinking, than his domestic policies are. It could be that China’s foreign policy power might be felled from within, though the next regime will hardly be left with nothing to once again resume the dream.

FURTHER RESOURCES:

China in Africa – Council on Foreign Relations

EU China Relations – European Commission

Global Implications of the U.S. military operations in Venezuela – Brookings Institute

After Maduro: Latin America reassesses the U.S.-China balance – Atlantic Council