Sino-American relations have been strained since the US and the Republic of Korea (ROK) announced they would hold a joint military exercise in the Sea of Japan and the Yellow Sea. To top it, the US Secretary of State Hillary Clinton has suggested setting up an international mechanism to settle the South China Sea territorial dispute.

But the chances of a military conflict between the US and China are slim because the two countries' ties are no longer guided by security concerns alone. The US and China have entered an era of interdependence, and economics, military and politics are the three main areas of their concern.

On the economics front, the two sides are more complementary than competitive, which signifies close interdependence. China has long been enjoying a huge trade surplus against America and used it to buy US Treasuries, which in turn has greatly helped stimulate consumption on both sides.