The Dalai Lama met with US President Barack Obama in Washington, despite anger from Beijing. China had warned in advance that the meeting would affect relations with America.
Recently tensions escalated between the two countries following trade rows and a fallout over proposed US arms sales to Taiwan.
Experts say the visit of the Dalai Lama, the spiritual leader of Tibet who is considered a separatist by Beijing, is likely to fuel another round of tit-for-tat measures.
“China is one of the leading foreign holders of US bonds. So Bejing has good leverage against Washington. It has already started selling its holdings,” Sergey Luzyanin, deputy head of the Institute of Far East Studies, told RT. “I think this trend will continue. But there are certain boundaries for China as well. I do not think it will be a mass sell-off and an attempt to orchestrate a collapse because China is tied to the dollar. But I'm sure some American companies will suffer multi-million or even multi-billon dollar losses.”
The US decision to hold the meeting with the Dalai Lama is a monumental affront to China and is a very unfriendly act, investigative journalist Webster Tarpley told RT.
“The US policy is not very easy to understand, because it seems to be very destructive with really no hope of succeeding,” Tarpley said. “It reflects this tremendous hysteria in Washington that China is overtaking the US in so many areas.”
“Look at Iran and Pakistan,” he continued. “Iran is simply the source of Chinese oil, Pakistan is the pipeline-country that will get the oil from Iran into China. We now have General Makarov, General Ivashov and Ahmadinejad himself saying they
Any straining in the economic relations between the US and China could prove harmful to both parties, says financial commentator Jim Rogers. “Trade wars have never worked. No one has ever won a trade war.”