Competitive Co-Governance: Rethinking U.S.–China Climate Cooperation Amid Strategic Rivalry

Essay Contest Honorable Mention

Graham Allison famously argues in his 2017 book Destined for War that relations between a rising power and an established one are often shaped by the structural tensions of what he calls the “Thucydides Trap,” a dynamic in which fear and strategic rivalry make conflict increasingly likely. [1] In the context of U.S.–China relations, this framework has been widely used to explain intensifying competition across different domains, ranging from technology to security. Yet an exclusive focus on rivalry might end up obscuring an equally important reality: Even under conditions of deep strategic competition, the two powers remain bound by shared exposure to transnational risks that transcend borders. 

This essay argues that U.S.–China cooperation is not being erased by competition but transformed. Rather than emerging from trust or alignment, [2][3] as most collaborations in international relations do, cooperation between the two countries is increasingly being shaped by what can be understood as competitive co-governance, a form of coordination that arises not despite rivalry, but precisely because of it. In areas such as climate change and critical supply chains, the long-term costs of unilateral action or full decoupling generate structural incentives for selective, issue-specific cooperation.

Building on this framework, the essay examines how collaboration is happening in practice. We identify concrete pathways focusing on climate governance and AI-enabled climate applications that allow both countries to pursue national interests while contributing to global public goods. These mechanisms, including methane mitigation frameworks, emissions accounting alignment, exploratory carbon market linkages, and federated AI systems for climate risk modeling, illustrate how cooperation can be structured to remain politically feasible under conditions of sustained competition.

Beyond the Competition–Cooperation Binary

Leading scholarship on U.S.–China relations is characterized by a strong emphasis on intensifying strategic competition between the two countries. This body of work highlights trends such as geopolitical rivalry, trade disputes, technological decoupling, and the gradual erosion of people-to-people exchanges, portraying bilateral relations as increasingly defined by zero-sum dynamics. From this perspective, even initiatives framed as global public goods are often interpreted through a competitive lens.

For instance, many Western analysts warn of the threats to the U.S.-led global order posed by China’s Belt and Road Initiative, which has invested over $837 billion in infrastructure projects worldwide, arguing that the BRI poses tangible challenges to American dominance across domains including technological standards, security, and international development. [4] Some Chinese scholars believe that this wary reception stems from Western comparison of the BRI to the United States’ post-WWII Marshall Plan, which also sent billions in foreign aid to Western Europe and utilized the superpowers’ economic heft in service of its broader geopolitical objectives. [5]

A second body of work, often grounded in theories of interdependence and global governance, highlights the continued necessity of cooperation between the United States and China. Despite efforts to “de-risk,” the exposure of the U.S. and Chinese economies to each other and global supply chains reflect the profoundly entrenched nature of economic interdependence between the two countries. [6] 

There are far-reaching consequences that affect more than just the two countries, with the wider economy impacted. Tensions between the world’s two largest economies have led to uncertainty in global markets, with the IMF estimating that the trade war reduced global economic growth by 0.8 percent in 2019. [7] Though there are scholars who argue that China, having accumulated significant relative power, often “weaponizes” its central role in global supply chains to influence foreign political actions, there are broad concerns that large-scale decoupling would generate substantial inefficiencies and systemic risks for the global economy. [8] 

The necessity of U.S.–China cooperation extends beyond economic interdependence to encompass a range of transnational challenges that require sustained governance coordination. A growing body of recent scholarship emphasizes that unilateral approaches are increasingly ineffective in managing global externalities, particularly in domains such as climate change, technological governance, and scientific research. 

Analysts at the Brookings Institution argue that, given their central contributions to global emissions, U.S.–China engagement is critical to effective climate mitigation, with “no way to contain climate change worldwide without full-throttle cooperation” between the two countries. [9] This argument is reinforced by recent climate policy research, which finds that coordination between the United States and China can accelerate decarbonization by aligning technological pathways, reducing policy fragmentation, and lowering the overall cost of emissions reduction. [10] 

Beyond climate, studies of global scientific collaboration suggest that U.S.–China cooperation remains structurally embedded in knowledge production systems, with joint research persisting even amid geopolitical tensions due to its mutual benefits and the high costs of decoupling. [11] Similar dynamics are emerging in the governance of frontier technologies such as artificial intelligence, where shared systemic risks, from climate modeling to extreme AI safety, have prompted calls for targeted cooperation despite broader strategic competition. [12]

While these strands of scholarship offer valuable insights, they share a common limitation: the tendency to treat competition and cooperation as analytically distinct. This binary framing fails to capture the evolving reality of U.S.–China relations, where rivalry and coordination increasingly coexist within the same issues. Approaches centered on decoupling risk generating new systemic vulnerabilities, while those grounded in interdependence often assume levels of alignment that no longer exist.

This essay seeks to bridge this gap by proposing the concept of competitive co-governance. Competitive co-governance reconceptualizes cooperation as an outcome shaped, rather than undermined, by strategic competition. Instead of asking whether cooperation can survive rivalry, the analysis shifts to how collaboration is reconfigured under conditions of persistent geopolitical tension—especially in areas where the costs of non-cooperation are both global and irreversible.

Competitive Co-Governance in Climate Policy

Among all issue areas, climate change offers the most immediate and necessary space for U.S.–China cooperation. As the top two carbon-emitting nations, which together account for over 40 percent of annual global carbon dioxide (CO₂) emissions, their actions are globally determinative. [13] Yet climate risks unfold over long time horizons and across borders, making them largely insensitive to short-term political cycles. This creates a structural imperative for cooperation that persists even as broader relations fluctuate.

Historically, bilateral engagement between the United States and China has played a decisive role in shaping global climate outcomes, including by paving the way for the Paris Agreement. [14] The 2023 Sunnylands Statement reaffirmed this pattern, outlining cooperation on the energy transition, forest conservation, and non-CO₂ greenhouse gases such as methane, while reviving a bilateral climate working group. [15] Such institutional frameworks, along with long-standing people-to-people and scientific exchanges, have historically enabled climate engagement to persist even under strained political conditions. At the same time, the United States and China continue to compete in clean technology and industrial capacity, even as they engage in selective collaboration. Therefore, the real challenge is how to structure cooperation in ways that are politically feasible in a geopolitical climate defined by competition.

One promising approach is the development of “green trade corridors,” mutually recognized zones where key decarbonization goods, such as solar panels, batteries, and critical minerals, can move with reduced tariffs and non-tariff barriers under shared transparency and sustainability standards. Such targeted arrangements would allow both countries to maintain strategic competition while reducing frictions in sectors essential to the global energy transition. [16] These corridors represent a form of selective coordination that aligns national interests with global climate goals.

A second pathway lies in technical coordination, which is often more durable because it is grounded in shared implementation challenges rather than political alignment. For example,both countries have prioritized methane emissions reductions due to its high short-term mitigation potential, yet face common challenges in measurement, reporting, and verification (MRV). While recent U.S. rules have focused on leak detection and reporting in the oil and gas sector,  China’s 2023 Methane Action Plan outlines broader sectoral strategies and improved MRV systems. These different approaches create opportunities for targeted exchange on methodologies, data accuracy, and mitigation technologies, as reflected in joint commitments such as the 2021 Glasgow Declaration and the Sunnylands Statement.

Closely related is the need for greater alignment in emissions accounting, which underpins credible climate governance. Both countries rely on internationally recognized frameworks such as Intergovernmental Panel on Climate Change (IPCC) guidelines. Yet differences in implementation can create friction, particularly as climate policy becomes increasingly linked to trade and industrial competitiveness. Incremental alignment in MRV practices, reporting templates, and sectoral classifications can therefore reduce disputes over carbon intensity and improve transparency without requiring full policy convergence.

A third, more exploratory area of coordination is the potential linking of carbon markets. Full integration between U.S. and Chinese emissions trading systems (ETS) remains unlikely in the near term, given significant differences in market design, sectoral coverage, regulatory frameworks, and levels of economic development. However, studies on international carbon market cooperation highlight that connecting specific industries rather than entire economies can serve as a transitional model that encourages participation while maintaining policy flexibility. [17] 

Recent research suggests that ETS linkage can reduce the overall economic burden of achieving climate targets by allowing emissions reductions to occur where they are most cost-effective. [18] In such scenarios, higher-cost jurisdictions like the United States can benefit from access to lower-cost abatement opportunities, while China can accelerate domestic decarbonization and expand its low-carbon industries through increased demand for emissions reductions.

In practice, cooperation could begin with aligning technical elements rather than merging systems outright. This includes developing compatible standards for emissions accounting, harmonizing monitoring and reporting frameworks, and coordinating mechanisms to manage price volatility and prevent market distortions. Such incremental steps would allow both countries to retain policy autonomy while building the foundations for deeper coordination over time. Linked carbon markets represent a pragmatic extension of competitive co-governance: They preserve national differences but create structured channels for cooperation where mutual economic and environmental gains are clear.

While strategic competition limits the scope for deep political alignment, it does not preclude collaboration in areas where interests overlap and global benefits are significant. In this sense, technical coordination serves not only as a practical tool for emissions reduction, but also as an institutional buffer that allows cooperation to persist within strategic rivalry.

AI Applications for Climate Cooperation

Artificial intelligence illustrates both the promise and the limits of U.S.–China cooperation under strategic competition. At the systemic level, cooperation in AI governance remains limited. Regulatory frameworks, technical standards, and safety norms are still evolving, while both countries increasingly treat AI as a strategic asset tied to industrial policy and national security. [19] As a result, engagement is likely to remain narrow, conditional, and issue-specific in the near term, reflecting a broader “wait-and-see” dynamic rather than deep institutional coordination.

A more realistic pathway for collaboration therefore lies in applied domains where mutual benefits are immediate and political risks are lower. Climate change is one of the most promising areas. AI is already improving the accuracy and speed of extreme weather prediction, including floods, wildfires, and heatwaves, which are often transboundary in nature. [20] By integrating meteorological, geospatial, and socio-economic data, AI systems enhance multi-hazard early warning and support anticipatory action. These applications are already being deployed globally, making them a practical foundation for cooperation grounded in shared climate risks rather than abstract governance alignment. [21]

Data sovereignty concerns remain a central barrier, but emerging technical approaches help mitigate these risks. Federated learning is an approach that enables countries to collaboratively train AI models while keeping sensitive datasets within national borders, exchanging only model parameters rather than raw data. This architecture directly addresses data sovereignty concerns that have historically constrained cross-border data sharing in climate science. 

The positive effects are already evident across multiple environmental applications. In air-quality monitoring, federated models allow geographically dispersed sensor networks to jointly improve pollution prediction without sharing underlying data. [22] Similarly, in climate and meteorological forecasting, distributed training across national weather centers allows models to integrate regional datasets without violating data-sovereignty rules, improving localized predictions while maintaining global coherence. [23] Federated AI training enables a form of coordination that is both analytically effective and politically feasible, making it particularly well-suited for U.S.–China engagement in climate-related AI applications.

In this sense, AI-for-climate cooperation represents a model of competitive co-governance in practice. It does not depend on resolving broader geopolitical tensions or achieving consensus on AI governance frameworks. Instead, it focuses on specific use cases like early warning systems and climate-risk modeling, where cooperation can deliver tangible global benefits. By lowering the need for direct data sharing and embedding collaboration in technical systems, AI enables a form of cooperation that is more resilient to political fluctuations.

Conclusion

In an era increasingly defined by strategic rivalry, U.S.–China relations are often framed through the lens of conflict. Yet this essay has argued that through the lens of competitive co-governance, cooperation emerges as a structural response to shared vulnerabilities that neither country can manage alone.

Across climate governance, clean energy supply chains, and AI-enabled climate applications, it is clear that cooperation is no longer constrained by ideological alignment. Rather, it can be selective and technical, embedded within systems that allow both coordination and competition to coexist. Mechanisms such as green trade corridors, emissions accounting alignment, federated learning, and carbon market linkages demonstrate that even under conditions of geopolitical tension, there remain domains where mutual benefits are sufficiently clear to sustain engagement. These forms of cooperation do not resolve underlying rivalry, but they prevent it from undermining the provision of critical global public goods.

This shift carries broader implications for global governance. As great power competition becomes a persistent feature of the international system, the future of cooperation will likely depend less on diplomatic consensus and more on the design of institutions, technologies, and market mechanisms that can operate under conditions of mistrust. In this context, competitive co-governance offers a pragmatic pathway forward, one that accepts rivalry as a structural condition, while preserving space for coordination where the costs of non-cooperation are too high to ignore. Ultimately, the question is no longer whether the United States and China can overcome competition to cooperate, but whether they can structure their competition in ways that still allow cooperation to endure.

References

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[5] 马建英：《美国对中国“一带一路”倡议的认知与反应》(U.S. Perception and Reaction to China’s Belt and Road Initiative)，载《世界经济与政治》，2015年第10期，第108页

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Image Credit: Oregon Department of Transportation via Flickr. (2008). CC BY 2.0.