As the new year got underway in China, hopes appeared to be running high that an easing of tensions with the United States could unfold in the months ahead. China’s Foreign Ministry expressed as much late last month when it said China would “welcome” a visit from US Secretary of State Antony Blinken – an expected visit that analysts say Beijing viewed as an opportunity to help strengthen its economy and repair fraught diplomatic ties. So when a high-altitude balloon from China carrying a payload the size of three coach buses equipped with what American officials have described as surveillance equipment was spotted over the continental US, visibly hovering above a state with key military assets and ultimately sparking an international incident – it naturally raised critical questions about just what had happened, and why. China maintains the vessel, which was shot down by the US over the Atlantic Ocean on Saturday, was a weather balloon thrown off course. And it has shown signs of both being caught off guard by the incident and wanting to stem the potential damage, analysts say, not only framing the situation as the result of factors beyond its control, but also offering a rare expression of “regret” over it in a statement Friday. While some crucial facts of the situation remain unclear, Beijing’s official response – and the timing of the incident, which resulted in the US’ postponement of the Blinken visit – suggest its leadership is now grappling with how to handle a diplomatic crisis that has inflamed the very tensions it had been hoping to mend. “By all accounts, the Chinese leadership was looking forward to having direct talks with Blinken … it would be very plausible that (Chinese leader Xi Jinping) would want to make sure everything was smooth in the lead up to the visit,” said Chong Ja Ian, an associate professor of political science at the National University of Singapore. “That this would happen is perplexing and strange,” he said. The possibilities Beijing has given sparse details on the origins of the balloon, which it first confirmed was from China in an explanation issued more than 12 hours after the Pentagon announced it was tracking the object. In a statement released late Friday evening local time, China’s Foreign Ministry described the balloon as a “civilian airship used for research, mainly meteorological,” which had deviated “far from its planned course” due to “limited self-steering capability” and westerly winds. In a follow-up statement Sunday, Beijing appeared to link the device to “companies,” rather than its government or military – though in China the prominence of state-owned enterprises and a robust military-industrial complex blurs the line between the two. On Monday, Beijing admitted a second balloon in recent days “seriously deviated” from its planned course and entered the skies over Latin America and the Caribbean “by mistake.” It declined, however, to provide more information on which entity manufactured the balloons. The US, meanwhile, has presented details that frame the incident as part of a surveillance effort powered by a fleet of Chinese spy balloons it says have been spotted across five continents over the past several years. Observers of elite Chinese politics say the timing of the less-than-subtle intrusion, amid a concerted Chinese effort to re-engage with the world and tone down its own combative rhetoric, suggests explanations ranging from a serious miscalculation by Beijing to a costly lack of communication within the government or with another entity. Steve Tsang, director of the SOAS China Institute at the University of London, said any surveillance operation involving US airspace would “almost certainly” have to get approval from top leadership, including Xi. That suggests, according to Tsang, there was either a “total miscalculation” in which the Chinese leader and his advisers thought the US would not respond robustly to the balloon, or the top leaders failed to “join the dots” between various activities to realize dispatching a balloon would have the potential to impact the Blinken visit. “Xi wanted Blinken to visit and discuss issues of mutual interest. Xi is trying to patch up the economy after the disaster of the zero-Covid policy and US restrictions on semiconductors. So, he could not have wanted an incident over the balloon that would derail such a meeting,” he added. Chong in Singapore raised another possibility: Like many other big bureaucracies … the right hand may not know what the left hand is doing and there may be a simple matter of the lack of coordination,” he said. The fallout While the backstory remains unclear as Chinese authorities have yet to – and may not – provide additional information, the result of the incident is a major blow for US-China diplomacy – and Beijing, experts say. “I think the Chinese leadership at the national level clearly felt upset and upstaged by this balloon,” said Dali Yang, a political scientist at the University of Chicago, noting the Chinese Foreign Ministry’s initial explanation was “unusually conciliatory” with its rare expression of “regret,” especially compared with its often aggressive rhetoric of recent years. “They were clearly hoping that this somehow could be smoothed out, especially given the context of Secretary Blinken’s planned visit at that point,” Yang said. Beijing’s rhetoric hardened significantly after the US military shot down the balloon, with China’s Foreign Ministry accusing the US of “overreacting” and “seriously violating international practice.” The Defense Ministry, meanwhile, expressed “solemn protest,” warning China “reserves the right to use necessary means to deal with similar situations.” On Monday, China’s Foreign Ministry said the debris of the balloon does not belong to the US. “The airship is China’s, not the US’,” a spokesperson for the ministry said at a regular news conference, when asked about whether the US should return the remnants of the balloon to China. “This is a delicate matter that played out in a highly public way between the two countries. Therefore, there is posturing,” Yang added. “For the Chinese leadership, they have a domestic audience they need to cater to too,” he said, citing the need for Beijing not to appear weak. Nevertheless, China has shown signs of trying to keep a lid on nationalist rhetoric around the incident, instead of fanning outrage – as Beijing previously did during events that stoked US-China tensions, such as then-House Speaker Nancy Pelosi’s visit to Taiwan last summer. Chinese state media on Saturday also announced the head of the country’s weather service was relieved of his duty, in a move seen by some analysts as an attempt to shore up Beijing’s position the high-altitude balloon was of civilian nature mainly for meteorological purposes. The official, however, had already been expected to depart after being appointed to a new post in January. But the diplomatic fallout from the incident will have serious, lasting consequences, experts say. “This balloon incident now sets us back significantly, because the calendar of US-China relations just over the next several months does not allow a whole lot of space for the two sides to reset,” said Jude Blanchette, the Freeman Chair in China Studies at the Center for Strategic and International Studies (CSIS), adding the meeting had been a chance for setting some boundaries for the relationship. China will hold its annual legislative sessions next month, when a reshuffle of leadership in the central government will be formalized. In the US, House Speaker Kevin McCarthy is reportedly planning to visit Taiwan – a move that will inevitably spark the ire of Beijing. “The relationship I think is just heading to a very, very dark place if the two sides don’t find some way to put a floor underneath,” Blanchette said.