Spoilers for the movie, obviously.
How dare the US pretend like they would be the peaceful nation and that China would be belligerent the entire time. Don't get me wrong, it didn't stop me from enjoying the movie. The atmosphere, setting, plot, editing. Everything was so fantastic. The aliens, the themes about language and culture.
And I know that it was a US made movie with US main characters, but everytime they mentioned China being hostile felt so cringe. I doubt Villanueve was being intentionally anti-China, he just needed a non US ally to be belligerent so the protagonists would have a clock to race against. But even having Russia in that role would make more sense. And even weirder that China was ruled by a general from the People's Liberation Army.
Now this isn't me coming from a "China would never do anything bad" perspective. It's just silly pretending that the US wouldn't immediately send sidewinder missiles into that thing before it landed. The US would shoot first, second, and third before thinking to ask questions. The Chinese weather balloon tells us all we need to know about that. Now for the sake of the movie I was willing to accept the premise, but when it became all of the non West countries acting hostile it stung with me.
I think I'm only ranting because it was such a good movie and the whole theme of language being the key to understanding culture was undermined by making China the Bad Guys. If this was a shlockier, worse movie I wouldn't care to complain about that detail. I haven't read the original short story, but I'm sure that it didn't have this element.
My only gripe with this is that they obviously knew that it was just a weather balloon, or at the very least that it wouldn't shoot back so I don't think this really supports your point even though I think you're right. Though I personally think the Euros would shoot first.
As much as I love Villeneuve's movies he does seem to have a ... hesitance when it comes to asian characters/people. The stuff in Arrival can obviously be waved off as just 'China bad' but I think it goes deeper. His next movie, Blade Runner 2049, has a lot of superficial asian influence but has even fewer (none iirc) asian characters than the original. Obviously Dr. Yueh is in the book so its hard to lay blame for him on Villeneuve but there's no other asian actors despite the Fremen being descended from Zensunni Wanderers. Presumably they weren't all just Middle Eastern and obviously Zendaya and Javier Bardem are neither so it seems like an odd omission.
Not really sure if its an intentional bias or not but Blade Runner especially would have benefited from having at least one named asian character. Why is everything in Japanese but there's no Japanese people?
The prevalence of Japanese stuff in Bladerunner 2049 is an artifact of cultural worries in 1983 with the first movie. It seems odd now, but in the early 80s Japan was briefly seen as the primary economic rival to the US. There was a genuine fear for a bit that the Yen would take prevalence over the dollar in some sectors, namely tech. Go look at magazine covers from the late 70s and early 80s. They couldn't shut up about how Japan would rule the world soon.
So why is there so much Japanese stuff but no Japanese people? Because at it's core it's xenophobic. It edges on being outright racist, by presenting Japan as like a cultural colonizer in the futuristic LA. I don't remember any of the Japanese stuff in the PKD story, it wasn't until the 80s did the ambient western worries start.
They'd culminate with the Plaza accords, which was a currency manipulation measure to ensure the dollar wouldn't have to compete as heavily with the yen. And that lead to Japan's asset bubble era and subsequent recession.