By: Our Correspondent

Each period in history brings new terminologies and acronyms that capture the essence of the time. In late 2006, British historian Niall Ferguson and economist Moritz Schularick coined the term 'Chimerica' to describe China and America, which, they said, had effectively fused to represent a single economy. Two years later, with the financial storm gathering, the US economist Fred Bergsten said the world should be run by the 'G2' – China and the US.

Against the backdrop of the world's first Group of 20 countries meeting in Washington to deal with the financial crisis, Bergsten's coinage took a new life as the core of the expanded club. However, in spite of the excitement about the new constellation, it has become clear that G2 is less than meets the eye. Even Ferguson himself has become doubtful of the viability of his own construct and called it a chimera. The fact is that the world has become too intertwined with myriad interests to be run by a duopoly.

Recent events and statements emanating from Washington and Beijing could indeed have conveyed the sense of an emerging co-leadership of the world, if not a condominium. On her trip to China, US Secretary of State Hillary Clinton chose to downplay the country's human rights abuses. She, instead, urged it to keep buying US treasuries. Clinton was not the only one to do so. On his maiden trip to China, US Treasury Secretary Timothy Geithner said, "The world is going to be watching what we do together… to help resolve the global financial crisis." In fact, the recent high level China-US Strategic and Economic Dialogue held in Washington reinforced the notion of a G2 in action. Some even enthused about the emerging signs of cooperation, while others in Europe and Asia furrowed their brows wondering what it would mean for them.

But a closer look at the US-China relations could dampen the enthusiasm of G2 supporters and lessen the concern of the worriers. Ferguson, who saw the symbiotic relations between China and the US driving the world, now thinks their marriage may be on the rocks. But divorce is not a feasible option either. However worried China might be about the value of its dollar holdings, dumping them would risk a further collapse in their value.

The China-US symbiosis appears more like a mutual death grip from which neither side dares make a precipitous move for fear of being pulled over the cliff by the other, says Christopher Clarke, a former official with the US State Department. Such imagery may be overly dramatic, but there is no mistaking Chinese nervousness at being stuck with $800 billion in dollar-denominated debt. China welcomed Geithner's assurances about maintaining a stable currency, but it is clearly seeking to inch away from the cliff, diversify its reserve holdings and open new markets.

While at one level relishing its new status as co-manager of the world economy, China is all too aware of the costs of being bracketed with the hegemon. Not surprisingly, in May, China's Premier Wen Jiabao made a 20-hour dash to Prague to attend the 11th China-Europe summit to assure European leaders that China was not interested in G2.

More than the Europeans, China would like to calm its poorer friends. The country's fast-growing economy is too dependent on raw materials and markets all over the world (and more so as the resources get scarcer and markets shrink) to allow it to join an exclusive club at the expense of its Third World comrades. Wen has taken pains to reassure them that China will "never seek hegemony", and that to "develop friendly cooperative relationships with all countries" was a win-win strategy.

This is not merely a question of tactics. Chinese leaders have always been conscious of the deep strategic and security gulf that separates them from the US. Hence, it is unlikely that they will buy the high-minded talk on the G2. China welcomes the promise of an economic and strategic tie-up with the US. But it never fails to point out that it is barred from buying high-technology American goods with possible military application. The same suspicions about China's strategic intentions that deny it access to dual-use technology are reinforced by recent confrontations with the US Navy in the South China Sea and, at the Pentagon, by Chinese weapons programmes.

So seen, the G2 is an idea whose time has not come. Given the old suspicions and increasingly intertwining nature of today's world, it is doubtful if it ever will.

Nayan Chanda is director of publications at the Yale Center for the Study of Globalization and Editor of YaleGlobal Online. This first appeared in YaleGlobal Online.