The two nations are already competing over many geopolitically significant countries, but perhaps nowhere as starkly as in Djibouti, an impoverished and tiny former French colony and current Arab League state in the Horn of Africa.
Djibouti is already home to Camp Lemonnier, the largest US military base in the continent, used by the highly secretive Joint Special Operations Command.
Camp Lemonnier is home to around 4,000 US military personnel, and is a launching pad for drone operations in the region and across the Red Sea, including in Yemen. Djibouti was also allegedly part of the notorious CIA-run rendition programme.
Under a ten-year agreement signed in 2014, the United States will pay up to $63 million annually to Djibouti to lease the base. The base is a cornerstone of US strategy to secure its interests and counter terrorism in the region.
In addition to France, which also maintains a base in Djibouti, a number of US allies have conducted military activities out of the country, including Germany, Japan, and Spain. Their operations range from anti-piracy missions to participating in the multinational intervention against al-Shabaab in neighbouring Somalia.
It is also likely the US has used its base in the country to provide intelligence support for the Saudi-led Operation Decisive Storm in Yemen against Houthi rebels, who are accused of supporting Iran, and being supported by Iran.
Another connection Djibouti has to the conflict raging across the Strait of Bab al-Mandeb is that it has become one of the key hosts for Yemeni refugees, who sail across the Red Sea in small boats to escape the fighting.
The Western powers are drawn to Djibouti not only because of its valuable strategic location at the entrance of the Red Sea, but also because of its relative stability.
|There are concerns the foreign presence might attract jihadists to their soil.|
For its part, Djibouti, in addition to reinforcing its stability, benefits from the (much needed) hundreds of millions of dollars the West pays in fees, aid and investment, and from the jobs and economic benefits foreign personnel usually bring with them.
However, not all Djiboutians are happy. Corruption is reportedly widespread in the country, and state revenues do not necessarily trickle down to the population past the ruling classes. Furthermore, there are concerns the foreign presence might attract jihadists to their soil.
For more or less the same stated reasons as Western powers, namely to protect its interests in the region and address the threat from piracy and jihadism, China too has come to stake a claim in the country.
In May, the president of Djibouti told AFP China was negotiating with his administration for the establishment of its first official naval base overseas. China is reportedly seeking to install a permanent military base in Obock, Djibouti's northern port city, and will pay the host country $100 million in annual fees.
China is also financing several infrastructure projects - reportedly to the tune of $9 billion - including developing the country's ports, airports and railway lines.
Beijing has neither confirmed nor denied the reports but Washington is not impressed with the "worrisome" Chinese presence there. In May, ahead of Secretary of State John Kerry's visit to Djibouti, a US congressman warned Washington's interests in Africa may be jeopardised by China's expanding presence there.
Representative Randy Forbes, chairman of the seapower subcommittee of the House Armed Services Committee, said: "China's determination for permanent bases far outside their traditional area of influence should remind Washington that Beijing sees itself as a global power."
The congressman is on to something. The Chinese quest for a foothold in the horn of Africa should be seen in the context of its broader Indian Ocean strategy and efforts to rearrange the global order.
Djibouti could also be one of the terminals of its Maritime Silk Road initiative, part of President Xi Jinping's flagship project for securing maritime routes to the Middle East and beyond, corresponding with the land-based Silk Road project that aims to consolidate China's interests in Eurasia and challenge the US domination of the Pacific Rim and the Indian Ocean.
Most likely, what is happening in Djibouti will be repeated in many countries, either becaue of their strategic locations or their natural resources.
Even rich nations and close allies of the US are having to accept a more assertive China. But perhaps Djibouti offers a blueprint for a - mutually begrudged - coexistence between the interests of the world's two giants, and some hope that the competition between them will remain peaceful for the foreseeable future.