The Conservative MP told Sky News that we are heading for a "bi-polar world" amid China's increasing tension and opposition with the west. Mr Ellwood added that China will continue to take advantage of hope that the nation might mature into a western democracy.
Mr Ellwood said: "We have seen a phenomenal rise in the economic power of China.
"At the same time that has been parallel with the demise of the West.
"There is a failure in the West to recognise what we stand for and what we fight for and China has taken advantage of that."
He added: "I really do believe that we have another superpower to contender with that has got a very different outlook that will challenge the way of the west.
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Mr Ellwood warned of China's economic power
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"We are already heading towards a bi-polar world.
"Unless we actually get more assertive in what we believe I am afraid China will continue to take advantage of us hoping it might mature into a Western open democracy that we once transpired it might would."
Last month George Osborne warned that tensions between China and the West could spell "unthinkable tragedy".
The former Chancellor told Amol Rajan's 'Rethink: The Edge of Change' that Western countries and America must decide whether to implement a containment policy against China or give them the seat at the world table their status deserves.
Mr Osborne warned that choosing to attempt to contain China could result in a new Cold War.
Mr Osborne said: "Either the West and America decide it is going to run a containment policy like a new Cold War which I don’t think we have got the collective effort or appetite for and by the way it might end up in complete tragedy and disaster.
"You look at the tearing up of the TPP and Brexit, it is not as if the western alliances are all holding.
"Or you say let's work with China.
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"You call them out when they are wrong such as on Hong Kong but also understand their legitimate desire and right for a place at the world table that reflects their size and importance in the world.
"That cooperation strategy seems to be the best way to deal with this rising power.
"The alternative is really unthinkable.
"Arguably with all these challenges we have got about, coronavirus, climate change, if we are heading into another Cold War between the United States and China that is going to dominate our lives and make solutions to these other problems simply impossible."