A Changing Geopolitical Landscape
During WW2 the United States and China were allies against Japan. They were later joined by the Soviets, when the German Nazis broke their alliance with the Russian Communists, and they invaded Russia in 1941, in order to get hold of the oil of Baku (Azerbaijan). But the Nazis were defeated at Stalingrad and they never reached Baku.
After jointly destroying the Nazis in WW2, the Soviets and the Americans became enemies once more, and the Soviets supported the Chinese Communists, while the Americans supported the Chinese nationalists in the Chinese Civil War. The Communists won the war, and the Chinese nationalists fled the Chinese mainland, and they established a small Chinese state in Taiwan. For a while the United States recognised Taiwan as China.
Map USA, Soviet Union and China
But the Soviets and the Chinese were also competing with each other in Asia after WW2, and the Chinese were very unhappy with the strong Soviet military presence in the oil rich countries of Central Asia, and also in Mongolia, which they perceived as a threat. Very often the Russians and the Chinese would support rival communist parties or groups in third world countries i.e. Angola, Mozambique, Somalia, Ethiopia, and Zimbabwe. See Russia VS China, and the Sino-Soviet Split.
https://iakal.wordpress.com/2015/08/11/russia-vs-china/
The Chinese and the Soviets jointly fought the Americans in Vietnam and the Korean Wars, but the Chinese and the Americans jointly fought the Soviets in Afghanistan.
Gradually, the Americans and the Chinese managed to improve their relations. The Soviet threat was what actually brought the two countries closer. From 1979 onwards, the American companies started investing in China, transforming Communist China from a poor agricultural economy to the factory of the world.
The benefit for the Americans was that they were dragging China away from the Soviets and closer to United States. Moreover the American consumers started enjoying very cheap goods, which were made in China, from very cheap Chinese workers. However for these Chinese workers even these low salaries represented a dramatic increase in their standards of living. Extreme poverty was reduced by almost 70% in the period 1981 to 2009. But many manufacturing jobs were transferred from Western Europe and United States to China. See “The Socialist Myth of Economic Bubbles”.
https://www.smashwords.com/books/view/450662
Image Extreme Poverty Rates
While the Americans were trying to drag China closer to them and away from the Soviets, the Russians were not wasting their time either. The KGB was preparing the demolition of the Soviet Union, in order to export the vast Russian oil and natural gas reserves to the big industrial economies of Western Europe i.e. Germany, France, Italy, Netherlands, United Kingdom and Spain. These energy flows would generate billions of dollars in export revenue for Russia, while at the same time they would increase Russia’s influence in Western Europe. The Russians also expected the Europeans to invest and build their factories in Russia, in order to take advantage of the cheap Russian labour (build your factories in Russia instead of China).
Therefore the world was moving towards a new geopolitical landscape, with China moving away from the Soviet Union and closer to USA, while the European Union was moving away from the United States and closer to Russia. Ronald Reagan tried to prevent the energy connection of Europe and Russia, but the German industry was very hungry for the Russian oil and gas.
Map China moves closer to America while Europe moves closer to Russia
Map
